Choosing an MLM Company -- Some Eye-Opening Insights

By: John Counsel

The Law of Success is the same in network marketing as in everything else in life...

"Do ONLY the right things, for ONLY the right reasons."

This is the classic, co-operative Win-Win approach that protects and nurtures the all-important relationships that lie at the heart of network marketing success, especially long-term. This is a business model that depends entirely on the quality and durability of the personal relationships involved.

The problem is that 98%* of network marketers DON'T KNOW what the right things to do are or, even if they know the right things to do, they don't have a clue about the right reasons for doing them.

[* How do we know that 98% is accurate? Because, across the world, MLM companies report that only 2% of their people earn more than 90% of the total income paid out by those companies.]

So they either take a guess, or they do what they see everyone else doing.

That's their first mistake. Big mistake. H-U-G-E!

NEITHER of these courses of action makes any sense. Here's why:

1. The fact that 90% of people FAIL in network marketing should tell us that doing what everyone else does is a surefire recipe for FAILURE.

2. You either KNOW the right things to do, and the right reasons for doing them or you DON'T... guesswork is only an option when chances are 50/50. That is, when there are only TWO choices. That's rarely the case in business. If you think there are only two options, it's because the others are hiding in that forest you can't see because of all those @#$%^&* trees!

3. All those people who do what everyone else is doing are usually following SOMEONE WHO TOOK A GUESS! (This is called the "Lemming Approach" to MLM. It's not hard to see why.)

Is it any wonder, then, that 90% fail?

The Law of Success delivers exactly what it promises -- SUCCESS! -- 100% of the time. But you have to actually OBEY that Law to be successful.

There's another Law that also delivers what it promises, 100% of the time. That's the Law of FAILURE. It's the Law you're obeying whenever you're NOT obeying the Law of Success... and that's most of the time for most people, because it's our DEFAULT setting! Unlike the Law of Success, it requires no actual KNOWLEDGE.

It's the Law that says...

1. Do the RIGHT things for the WRONG reasons.

This is the classic, competitive Win-Lose* approach "the end justifies the means". It's selfish, manipulative and deceptive. It undermines and destroys relationships -- the very basis of all true, long-term network marketing success!

2. Do the WRONG things for the RIGHT reasons.

This is the classic, self-defeating Lose-Win* approach "the means justify the end". Huh? Explain that again? It's absurd nonsense. It's just plain stupid.

3. Do the WRONG things for the WRONG reasons.

This is the classic, suicidal Lose-Lose approach "Listen, don't tell me what do do... let me make my own mistakes, okay?" It's a death-wish for your business that WILL come true. All it takes is time.

It never ceases to amaze me how few people are willing to obey the Law of Success. But what amazes me even more is how many people in network marketing expect to SUCCEED by obeying the Law of FAILURE!

[* Win-Lose and Lose-Win are actually counterfeits... fakes. They're nothing more than Lose-Lose posing as a win to fool you. But, sooner or later, the loser is going to wake up to reality and terminate the abusive relationship. Then it becomes exactly what it always was -- a loss for BOTH of you.]

Here's the bottom line for 90% or more of ALL network marketers:

IGNORANCE is the #1 killer of part-time network marketers.

So let me give you some practical tips on the right things to do, for the right reasons.

1. Use your BRAIN and your CALCULATOR, not your emotions. This is BUSINESS. You'll be eaten alive by scam artists and predators with sophisticated and highly deceptive emotional appeals -- that, in the bright light of reason, make no rational sense at all -- if you don't evaluate intelligently.

2. Evaluate ANY network marketing opportunity according to these five criteria, in this STRICT order of priority:

a. The company and its owners/management

This is the #1 risk area, since the next 2 criteria are driven by it. Inexperienced management -- or ulterior motives because they're rip-off merchants -- are the cause of most MLM company failures, and it happens a LOT more than most people realise. In fact, most company failures involve people with histories of fraud, including breach of court orders from previous scams.

b. The Compensation Plan

Don't consider ANY plans that don't give the part-timer a fair chance to get into positive cash flow quickly -- and stay there, with high activity and high retention.

Here's the simple, brutal reality that affects EVERY kind of compensation plan in network marketing:

Real income growth comes from building wide, not deep. What you gain from building deep is stability and security of income.

The reason's simple: all compensation has to come from the wholesale price the company charges for its products. That price isn't open-ended. It's limited. So the amount payable to the network is limited, too.

Payout on depth MUST be blocked at some point, because the money runs out! (Even so-called "infinity" bonuses get blocked eventually.)

But on width, the money never runs out. It introduces new customers and distributors close to your position in the plan... so you get the benefits you'll never enjoy from depth.

If a plan limits width, it also limits your income potential.

Avoid binary plans like the plague. They do NOT work for part-timers. Nor do most* stair-step breakaway plans. These tend to be geared for "heavy hitters"... the EXCEPTIONS to the rule that most companies always hold up as role models for everyone to emulate. And the "new" (they're old!) single-leg "power line" plans are just plain crazy, once you get past the razzle-dazzle of nonsense like "spillover".

Remember the old adage in network marketing? It still holds true (more than ever, in fact)...

1 leg = a walking stick. Highly unstable.

2 legs = a ladder. A bit more stable, but you need to lean on something or someone. No true independence.

3 legs = a stool. More stable than the first two, but not completely reliable.

4 legs = a table. Stable, secure.

[* Note: Not all stair-step breakaway plans are duds. And don't let anyone fool you -- EVERY kind of plan is ultimately a breakaway plan because the money runs out on depth. They have to be, or the company will go broke -- fast!]

Don't be seduced -- suckered! -- by your own fear of loss. It will have you doing the wrong things for the wrong reasons faster than anything else!

This is a highly complex area of network marketing and you need to understand the pros and cons or it's easy to fall for the wrong kind of appeal.

c. The Products

It's important to have outstanding products that will effectively sell themselves. Most people aren't sellers and don't want to be. The products should be safe, effective and outstanding value for money. (Many companies fall down right there.)

When the first two criteria can't be adequately met, the product is usually hyped to the limit, with H-U-G-E emotional appeal that rarely lets the FACTS get in the way of a great story! The "faithful" are emotionally bonded to the products, almost to the point of fanaticism. When challenged about their company or reward plan, they retreat immediately into an emotional defense of their product, even though the discussion has nothing to do with their products.

Here's the simple truth:

Network marketing is NOT driven by products! It's driven by INCOME.

Your business is NOT your products. They're the COMPANY's business. YOUR business is a vehicle that delivers the company's products to its target market. The products are nothing more than the PAYLOAD you carry in your vehicle. What fuels your vehicle is MONEY. (Cashflow is the lifeblood or fuel for every kind of business.)

Don't confuse the two -- no matter what your company or upline leaders tell you!

If products were the #1 motivator, why do FEWER THAN ONE THIRD of all network marketers use their own products?

In most cases, it's because they can't afford them, because the products are over-priced to reward the heavy hitters and companies, and the part-timers can't even make enough money to cover their product usage because of punitive pay plans.

At every industry seminar or workshop I present, I can count on being approached privately by people wanting to know if I can recommend an MLM opportunity that will make them enough money to pay for their product consumption with their present company!

(But they're so emotionally hooked on those products that they won't even consider the reality of their situation.)

d. The Upline Team

This one should almost be third in priority in my own mind. The right upline team will actively and enthusiastically train and support you, won't exploit you or see you only as a means to an end. And they do NOT make most of their money from selling you training seminars, books and tapes!

To get an accurate indicator of an upline team's real level of support and commitment, try talking to members of their downline who've been with that company at least a year or more... what are they like over the long haul? Consistent? Avoid would-be sponsors who are long on hype and short on fact, high on promises and low on delivery.

e. Training, Support and Business Building Systems

If your company and upline team can't offer you a powerful, integrated, results-driven system that actually WORKS (and doesn't cost much or, better still, is free) both on line and off line, DON'T get involved with them.

Success in this business is all about DUPLICATION. The problem is that PEOPLE are NOT duplicable. SYSTEMS ARE.

No proven system = no duplication = no success.

Insist on talking to people who are products of the system. That way, you KNOW it works. (Talk to lots of them, too.)

You can learn more about what you need to know to properly evaluate network marketing opportunities at the links below.

(c)John Counsel is CEO of The Profit Clinic MLM Success Centre, a leading on-line resource for network marketers, and author of two best-selling books on network marketing. Visit www.profitclinic.net to learn more. John presents regular free webinars at www.FREEcoachingonline.com, as well as bulletins and special reports by email. Subscribe at www.profitclinic.net/reports/register.php. Learn to evaluate opportunities at www.EvaluateMLM.com.

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