Earning additional money has become a necessity for most people in these tough financial times. Gone are the days when persons could feel comfortable with a single source of income – for some people, a nine-to-five job has almost become an endangered species.
As people look for ways to supplement or replace their salaries, one business opportunity has risen to the forefront as a viable option. Network marketing, also called multi-level marketing (MLM), is now being seriously considered by many people as a route to starting their own business.
This alternative method of marketing products has been underutilised by many people due to their ignorance of how it operates. Direct selling simply allows consumers to benefit from buying or selling products straight from the manufacturers or large distributors. The money that would normally be paid to wholesalers, retail outlets and advertisers can now be passed on as commissions to the end users.
Over the years, the network marketing model has received a bad reputation due to the actions of pyramid scheme operators claiming to offer legitimate MLM opportunities. Pyramid schemes entice people to join them by offering a monetary reward for enrolling others into the programme, without any product or service being consumed.
To distinguish a viable network business opportunity from a pyramid scam, you have to ensure that the main source of the commissions is coming from the sales of the company’s offerings. If the plan offers impossibly high compensation payouts that are tied to pricey entry fees from new recruits, it may be a sign that the business is likely to be a non-sustainable operation.
The reality is that the multi-level rewards concept already exists in many organisations. Sales people earn commissions on their individual efforts, while their sales managers and their bosses also earn bonuses from the combined efforts of their teams.
Photo by DerrickT
Marcy on July 30th, 2009 at 1:08 am
This is awesome! It guides people on choosing the right MLM to engage in and be familiar with the scam one. This is helpful for those looking for a homebased business to run.
Thanks for this Angela! Keep posting more informative article like this. (”,)
ricky on August 3rd, 2009 at 5:41 pm
in the past years,network marketing has been prove to be a good method to do MLM works.
postcard marketing on September 23rd, 2009 at 1:28 pm
I agree that this industry has suffered some black eyes, however it still has some benefits that no other business model has. A chance for anyone to start a business on a small budget, and build up a huge residual network is a great opportunity. Nice post.