Many MLM-based companies promise that anyone who gets involved will almost immediately begin to earn outrageous profits. This is certainly possible for some people; you will see quite a few “Avon Ladies” who make quite a nice secondary income selling their products. However, statistics show that less than 1% of MLM participants ever see a cent of profit. Sometimes this can be attributed to a sheer lack of effort on the part of the associate, but more often than not it is simply due to the impracticality of the MLM company. They may expect a certain amount of sales, but offer a product that is not very popular. MLM associates usually sell to family and friends or door-to-door, creating potentially awkward situations.

Many people also believe that being an MLM associate is something that can be done in ones spare time. The companies also play on this belief, advertising a flexible schedule and just a few work hours. However, in order to turn over any sort of profit, the associate will have to work for huge amounts of time and put in a huge amount of effort to make sales. Great persistence is required to continue on selling the products, and this cuts a huge chunk out of the personal life of the associate since they begin to look to make sales to every person who walks by. Some associates become completely obsessive, trying to make a sale whenever the opportunity arises. However, as long as you can remain tactful, you should be fine.

MLM companies often try to make their distributors feel that they own their own business, or that they are becoming self-employed by becoming involved with the company. However, MLM distributors very rarely ever become self-supporting with their sales. If you are looking to own your own business and be self-employed, you will have better luck formulating a real business plan and getting a startup loan. It takes more work to get involved with, but the chance of a payoff is much higher than getting involved with a multi-level marketing business. If you have to, get a book on starting your own business.

There is another good rule of thumb to follow when deciding whether or not to get involved with an MLM company. If less than 80% of their sales are made to non-distributors, then it is probably not a good idea to get involved. You would be surprised at how many of these businesses are technically illegal, but continue operating simply because nobody has lodged a complaint against them. Therefore it is up to you to do your research and make sure that enough of the products are sold to actual customers to make it worth joining. Examine all of the things that have been mentioned so far, and compare them with your personality to decide whether you are a good fit for an MLM company. Do all of this before you make any commitment, and you will be glad that you did.

Brian Hackett, CEO
MLMNetworker