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What is A Legitimate Multi-Level Marketing and How to Avail Its Compensation Plans?

Apr 2, 2008
Multi-level marketing (MLM), or also known as network marketing is a form of business distribution allowing a company with a parent multi-level marketing to promote its products and services immediately to the customers through direct selling and by means of self-employed independent salespeople known as the distributors. Simply, it is considered to be one of the business compensation plans one could find in the success of a home business industry. Though some may link MLM with the pyramid scams that have spread all over the Internet, legitimate MLM companies are only earning from the sales of their products and services.

How do you earn as part of MLM?

If you are a networker or an independent distributor, you obtain commissions through:

1. your sales of the products and services of the company you are working for

2. sales of other people you were able to recruit and became distributors as well. When these people are able to sell the company's goods and services, a percentage of the sales will be given to you.

MLM plans generally give commissions by more than two levels of recruits, commonly known as the downline of the distributor.

A downline is a distributor who you were able to recruit, thus you are given commissions on his/her sales and the sales of another set of distributors who were rectruited by the same person you recruited as well. The upline is considered as that of a distributor which is above you and who recruited you. Thus he/she may also receive commissions from the products you have sold.

What to do before you become part of the MLM plan?

New recruits who will be part of the whole MLM plan in the future are sometimes obliged to pay for the training they have to undergo, the materials they would be needing, and the products they have to sell as part of their own inventory. The reason why recruits are obliged to pay for their inventory is to ensure that their distributors are prevented in doing the so-called inventory loading so that these people may be qualified to receive more bonuses. This rule then ensures the at least 70% of their inventory are sold before they could acquire a new set of orders.

How to become a successful member of the MLM plan?

1. Educate yourself on the type of MLM system the company is running. Join the company's educational programs which are certainly a big help for you. These programs are mainly focusing on customer relationship, money management, leadership, etc.

2. Know the products you sell to your customers and always be ready to entertain the questions with regards to the products you sell or the services you offer.

3. Ask guidance from family, friends and a legal officer so that you may be guided as a member of the plan. Never go too far and take each step to success step by step.

While on the first few months of being a part of a legitimate multi-level marketing plan, you really don't earn that much, however, you may also find it an enjoying and satisfying job. With this type of job, the more you work, the more you are likely to receive higher commissions. You can be your own boss and you can be a part of an excellent social network.
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