Wednesday, July 1, 2009

How To Choose An MLM Company

Jeff Flow

If you are looking into starting a home based business, on either a full or part-time basis, and are good at working with people, but have little business knowledge and minimal capital, then Multilevel marketing may be for you. Before you jump into a MLM company, you should consider the positives and the negatives of an MLM company.

This article will show you the positives to look for in an MLM company and some of the downsides of MLM companies.

An MLM company provides a product or service to the consumer through a network of distributors. The distributors make their money through a percentage of the products they sell. They also make a percentage of revenues from the customers of the distributors that they recruit and a percentage of the distributors that their distributors they recruit. This is why it is called multi level marketing.

Reputable MLM companies also provide a low start-up cost, all the training you need, advertising in one form or another, and supply you with a product line-up or service to sell.

The United States Federal Trade Commission, however, cautions anyone from joining a MLM company that pays you for each distributor you recruit, as opposed to only paying a commission on the total sales they generate. This is called ‘Pyramiding' and is illegal.

Before you join an MLM company you should take the time to really looking into the company beforehand. Do your due diligence. Here are the positive and negative factors to consider when choosing an MLM company.


-Established and marketable product line or service. -Striving to improve or add to the existing line-up -Easy to sign up new distributors online. -Solid track record and good work ethic. -No experience required. -Training provided. -Excellent bonus plan with incentives. -Minimal start up fees. -Strong support system. -Successful business and marketing plan -Can work full time or part time.

These attributes would definitely belong to an ideal multilevel marketing company, however not all reputable companies excel in all these areas. Some companies will be better in certain areas than others. Do research on the company. Don't just accept the motivational hype used by most MLM companies in order to recruit.

Some MLM distributors are so highly trained that they have a "come-back" for almost every statement you make or concern you have. This would be considered a ‘high-pressure' invitation to join. Always take time away to cool off - especially if you're excited by what you heard. Sit on your decision for a while and do research. If the company is good, they will still be there when you wake up tomorrow; and yes, you will get a follow-up phone call.


While the MLM model can be a great tool to achieve what you want in life, it would be remiss not to mention the negatives of MLM companies.

-Watch out for disreputable MLM companies. -Building a downline will take longer than and cost you more than you think. -There are costs to running an MLM that you need to consider: gas for your car, staying in hotels, and taking people out to eat. -It usually takes a minimum monthly order to maintain your distributorship. -Watch out for getting paid to just recruit distributors and not on sales volume. -Even though the companies insist the products sell themselves, it is still going to take hard work to make money. -In MLM you have to deal with rejection. -Getting involved with certain MLM companies can cause you to focus all your attention on your business. Some distributors stop attending important family events because the family event falls on the same date as one of their MLM seminars.

When considering getting involved in an MLM company take the time to choose the right company. There are many different companies to choose from. Resist the temptation to just join any company, but do your due diligence. Also, count the costs involved in getting involved in MLM. Realize that there are hidden costs to starting an MLM company that you may not see on the surface.

Starting an MLM business can make you a fortune, but it can also cost you a fortune. It is going to take consistent and diligent work to succeed. Make sure that the company that you choose to work with has all the positives mentioned above and also take the time to consider if you are willing to put in the work that is necessary to make MLM work. And remember, God loves you.

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