The Most Important
Network Marketing Tip You Will Ever Receive
The most important network marketing
tip you get probably won't come from friends or associates. They
are all well-meaning. They are mostly wrong.
The most important network marketing
tip you’ll ever receive is:
| Carefully read the terms and
conditions of any network marketing program, particularly
related to earnings. |
This sounds easy, but it's not.
So many people get caught up in the hype of potential earnings that they
totally lose track of basic business essentials. One of the very
basic business essentials is: Read the contract. This is
particularly important in Network Marketing and MLM businesses.
The "Falling Off the
Cliff" Clause
Many people are unaware that if they
don’t personally meet certain sales targets every month they won’t be
paid commission on any of the sales their down-line has made.
Nothing. Nada. Zilch. Zero.
For some companies this simply means
you have to make sales every month as well as the required personal
purchases of products. For others the requirement is to meet a
specific sales target or sponsoring new people.
One dollar less than what is required,
and you've fallen off the cliff.
I wasn't kidding about this being an
important Network Marketing tip. A very important one. This
is something you need to be very clear about before you sign up and
invest a lot of your time in building a down-line. The time it takes to
train and develop a down-line is valuable. It is important that you are
compensated for it irrespective of whether or not you personally make
sales in a single month.
Other Common
Contract Qualifiers
Some even more stringent rules require
that you meet set sales and purchasing targets to qualify to earn income
on your own monthly sales. For example, if your quota is $2,000 in
sales in month, and you make only $1,900 then you NO COMMISSION AT ALL.
Not from your sales, and not from your downline sales.
These guidelines are entirely to the
benefit of the network marketing companies and are to the disadvantage
their distributors. Such rules make it difficult to profit from network
marketing. It is therefore important to take note of this network
marketing tip and avoid companies that disadvantage their distributors.
"Stair Step
Breakaway Compensation Plans"
These payment restrictions are known as
“stair step breakaway compensation plans.” Different companies will use
different versions of the same basic idea. Some companies specifically
require that you sponsor a manager in your down-line in order to earn
income from it. Others only pay compensation to a specified level in the
down-line while others require a minimum total sales figure in the
down-line before they will pay you compensation.
Unfortunately, some network marketing
companies actually combine a number of these requirements making it very
hard for their distributors to succeed.
The best network marketing tip you will
ever receive is to avoid such companies like the plague.
Unfortunately, this network marketing
tip is rarely mentioned and consequently many new network marketers
receive a rude shock when their check is stolen from them unexpectedly.
(And, YES! I do consider this STEALING!)
While network marketing companies
include this payment rule to pressure their distributors to continually
work for the benefit of the company (because it is in their own best
interest to do so), it can and does backfire badly on them. The
attrition rate among new network marketers is very high and these sorts
of financial losses figure high on the list of reasons.
So here's this network marketing tip:
Evaluate the network marketing opportunities you may be considering
based on the most beneficial terms for members.
Avoid signing up with network marketing
companies that limit your capacity to earn from your down-line based on
your own production. The primary incentive for building a down-line is
the promise of earning residual income from their sales. This should not
be conditional upon your personal earnings for a given month. If you
become ill and cannot work or wish to take a vacation, you need to know
that your down-line is still benefiting you.
If you ignore this network marketing
tip and sign up to a program that will penalize you if you don’t meet
personal monthly sales targets, sponsor new people in a given month,
sponsor a manager or run training programs for your down-line during
that month, you may find yourself unable to even take a vacation without
taking a massive income hit.
No Vacation, No
Retirement, No Nothing
These types of compensation plans mean
that you cannot retire on network marketing earnings. For many people,
the promise of creating a residual retirement income is why they are
interested in a network marketing business in the first place. It is
therefore very important to choose a network marketing opportunity
wisely.
Can They Boot You
Out the Door?
The compensation plan should not be
your only concern when reading the contract. Be aware that if the
company can cancel your distributorship with or without a reason, your
business can disappear in a month. Even if the compensation plan allows
you to continue receiving income from distributors after you retire from
selling yourself, a company that has the ability to terminate your
distributorship on a whim can effectively steal that income.
Relying on a company that has this
clause in its agreement means you are relying on integrity that may not
exist. It is very important to limit your risk of losing your business
by taking note of this important marketing tip and choose your company
and opportunity very wisely.
However, if we don’t act on good,
reliable information all we’ve done is waste our time. Don’t ignore this
network marketing tip. Read contracts carefully before signing up and
make sure you are not disadvantaged by a network marketing company’s
payment criteria. Their goal is to maximize their profits. Your goal
needs to be to maximize yours.
Cover Your Backside
The easiest way -- and the best way --
to make sure you are not going to lose the business you have built is to
have multiple streams of income and not to be dependent on any one
Network Marketing MLM business opportunity. After all, no matter how
careful you are in evaluating a network marketing business, things can
go wrong. Having your eggs in more than one basket just makes sense.
