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Heartbar - A Network Marketing Horror Story!

Aug 17, 2007
We do a training called the "5 Pillars for Success". These are the pillars that YOU as an MLM distributor need to have in place for success. It's not what a network marketing company needs. It's you, the distributor, and that is an important difference to understand.

The top company in the network marketing industry does $10 BILLION in sales every year. Company #2 does 1 Billion a year. And what's amazing is, Company #1 pays only about 10% of the commission that Company #2 pays!

Company #1 is very profitable. But, aside from the old-timers, the distributors are not profitable at all.

***Do They Even Know How To Spell MLM?***

So company management experience with integrity is Pillar #1. Has that CEO or management team ever built a network marketing organization?

A lot of these network marketing company owners come from a Fortune 500 background. They've never driven 4 hours one-way to do an opportunity meeting for 20 people, only 2 show up, do the meeting, do the training, drive home, fall asleep at the wheel, pull into a rest area and sleep for a couple hours so they can get home, get a shower, and go to work that day as a secretary, a nurse, a carpenter, a doctor ...

THAT is the truth about MLM that these pretty-boy hotshots will never know. Let me tell you a story.

My good friend Dave Cones came to Florida from Oklahoma, in 2002. We were invited as guests to an opportunity convention, because we were doing some consulting with these people. We sat in the audience. It was a 2-day event. We watched the presentations & watched the people there.

The company - and I can mention their name, for reasons which will soon be obvious - was Heartbar, a publicly-traded network marketing company. They were about 18 months old at the time.

***President of the Company - Great, Fabulous Guy!***

You couldn't have found a nicer guy ... but he didn't know anything about MLM. His background was Fortune 500.

So he's onstage doing a presentation, and he said, "You know, I've just so enjoyed travelling the world, travelling across the U.S., going to the meetings, meeting such great, great awesome people. What amazing people that we've met!"

"And that's going to have a big impact on our decision, if we ever decide to do away with the compensation plan and go to direct sales."

Dave & I looked at each other. We had the same thought: "Whoa! Hard to believe that guy said that from the stage!"

***The Reps Must've Been on LSD!***

When they took a break, Dave & I chatted with some of the reps. We asked what they thought about what the President said about doing away with the compensation plan.

Nobody heard it!

It was amazing. It was like they were on some euphoria drug. We didn't talk to one single person who heard him say that!

Something else those reps didn't know: Heartbar created a product and was selling it to athletes. They didn't think their reps would ever find out. Of course, the reps did find out. And when they realized their own company was competing against them, they raised a howl.

***The "Dear John" Letter Arrives***

And right after this ruckus, the company sent out a letter of termination to every single Heartbar rep.

How could they do it? Because a clause in the Heartbar Policies & Procedures said "Company may terminate the status of any distributor at its sole discretion, without cause, by giving 30 days written notice to the distributor."

And if you were unclear what they meant there, you just had to read down another couple paragraphs. It said, "Termination results in the distributor's loss of his or her sponsored downline organization."

So distributors built the organization, built the group volume, & built the product sales. And the company cut the reps out of the profit picture and went direct sales with it.

This is EXACTLY what you can expect with a management team of Fortune 500 guys who never built an MLM downline. They have no understanding, no empathy for you. Their only concern is bottom line profitability.

So if you built their business for them, but it's in their financial interest to get rid of you - and they can legally do so - you will be history.

Have you read YOUR network marketing company's Policies & Procedures lately?
About the Author
In the early 1990s, Michael Dlouhy (http://www.AskMichaelDlouhy.com) joined 100 different MLM companies, in order to compare them all. At his website, you'll learn what Michael has learned, the good & bad about all these companies.
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