Home » Business » Entrepreneurship

Is Network Marketing Residual Income A Myth?

Mar 14, 2008
For those who gained negative experiences from network marketing, the very first idea that comes to their mind whenever they hear the word is "scam." This is for those who find it a fraudulent activity; something that other people uses in order to gain money from them without even returning something good in return.

But for those who earned a hefty amount of advantages, network marketing is a new way of earning a living. They see it as an invigorating change from the typical way of marketing, wherein they can earn more without even doing more.

We know it better as residual income. And this is where network marketing aficionados contend that they alleviate people's lives more than anything else.

But the question is, especially for those who cannot grasp yet the meaning and the process of gaining residual income; does network marketing provide residual income? Is it really true or just some fancy advertising strategies so as to attract people to join their marketing scheme?

To answer that, let us first define what residual income means.

In simple terms, residual income refers to the continuous payment or compensation that you get even if you stopped working. That is on a monthly basis. For example, once you entered and joined network marketing, the company or the organization will give you a portion of the profits every time the customer you have referred to them buys a monthly quantity of their product. This means that even if you are not selling anymore or even recruiting somebody into the company, you still get to earn some money.

Sounds too good to be true? Guess again.

Most network marketing companies contend that residual income is, indeed, downright achievable based on the premise that what their member earns is just the benefits he or she gets from providing the company a greater source of income that is, referring some customers. And the residual income that they get is the compensation they get from their downline.

Moreover, most network marketing people insist that when you enter into a network marketing scheme, the very premise that you get paid is because you also help other people grow their business that is why you get the profit from whatever income your referrals achieve.

If this is the case, then why the fuss about this matter? What is wrong with getting a residual income?

Actually, there is nothing wrong about it. If you earn, then, that is good for you. But the fact that network marketing asserts a continuous flow of compensation even if you don't do anything is illogical in the sense that everything you earn in this world has its price. You sow what you reap.

Consequently, in order to enlighten those who wish to know if the residual income in network marketing is true or not, here are some facts that you must know first:

1. A business is a risk.

This means that nobody can be sure that their business will grow or not. Therefore, any company existing today may not be so twenty years after.

If you are to look into the reality, you can clearly see that there were companies that were previously strong and seem to be in perfect business but have already closed down.

2. Everything is a fashion.

Since most network marketing, or any company for that matter, involves a certain product, we can always say that what may seem fashionable today may not be acceptable in a month's time. Most products that exist today are sometimes in demand because of their newness. But after sometime, the trend dies down and the product is left behind.

3. The concept of "attrition"

Let's face it. Nothing is, indeed, permanent in this world. People come and people go. When your customers have finally decided that they no longer want your product because they are not satisfied anymore, they would go and leave your services. That is what attrition is all about. It is how your wages deteriorates due to the drop off scale of your client base.

So, now to answer the question whether the residual income most network marketing asserts is true or not - it depends. Like any business or venture, we should always bear in mind that it is not permanent.

The bottom line is that whether a person gets a residual income or not, the best thing to do while still earning money is to save for the future. Never depend on it as if it is a bottomless pit where money comes incessantly.
About the Author
Daegan Smith is an Expert Internet Network Marketer. "Learn How To
Make $10,717 In Less Than a Week While Quickly And Easily EXPLODING
Your Network Marketing Organization Without EVER Buying a Single
Lead?" http://www.internetmlmsuccess.com
Please Rate:
(Average: Not rated)
Views: 135
Print Email Report Share
Article Categories