# Archive > Open content archive > MLM Industry Forum >  MLM - Very Possibly the perfect Business

## thebanman

I have read a lot of Robert Kiyosaki's books including his latest one with Donald Trump. I was very surprised to see them both advocate MLM / Network Marketing. 

I think that Robert Kiyosaki has a great way of looking at a business opportunity through this B/I Triangle diagram. 

I'd love to knock things back and forth with agruments for and against as to why Network Marketing very possibly is _the perfect business_.

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## stephanfx

I recently attended a Network 21 gathering, which is advocated by Robert Kiyosaki. It all seems very nice, but the thing is you only get great return if you get people in your downline. You do make money and you sell items, as you make points on the items you sell, but the big bucks lie with people beneath you, the more they sell, the more you earn.

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## thebanman

Exactly correct, the money is in the the people in your system and also the amount of goods being sold and flowing through your business. 

I find it funny when I come across people who ONLY feel that Network Marketing is a "get rich quick" scheme. Most of the successful Network Marketers that I have come in contact with (In SA and the States) have only really seen the success come in 3 - 4 years. 

When I first was introduced to Network Marketing I got all the horror stories from everyone as to how BAD this industry is. I decided to do my own research. I went to all the meetings, trainings, I signed up with a few and got to see the nuts and bolts. 

My feelings after my personal quest were very simple. This industry IS for some people and IS NOT for others. 

Unfortunately it's the "IS NOT"s that are the ones throwing the pies around and not the "IS"s. 

I think that they should just go back to their TRUE pyramid scheme of working hard all day at the job they hate and having _management_ make all the money!

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## stephanfx

I tend to agree that most companies are structured like a pyramid, that is why it is the guys at the top that get the money. 

Network Marketing is a great way to advance, but some people are just much better at it than others, and it is true that most of those who do not succeed, are the ones meant to be at the bottom for a long time. People should start to see that working for a boss is not always going to be the best answer.

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## Ann Williams

I believe in MLM, particularly as a solid sales network - as long as those who enter it do so after having made a solid business decision rather than an emotional one based on pitches to become a member.

One of the things that bugs me about the Network 21 is that although my hubby has been approached, been to the introduction evenings (yes, plural), been given 'info' on the products, and gone through their materials - I still haven't managed to find someone in my area that is *just* willing to sell me the products that I want!

 :Cool: I don't want any sales speeches, invites to attend any get togethers to get to 'know more about our products' or 'to learn more about the best business opportunity on the planet'. I just want to know how much the washing powder is going to cost, how long it will be for my order to be delivered, and someone who can answer my specific questions without giving me the business equivalent of a religious revival meeting sermon... (And don't try to sell me their toothpaste, especially when I have already said "no".)

I also don't have the inclination, time or contact network in my area to become a member, so don't even ask me (let alone pester me).

A few months ago I asked again for a catalogue or at least just a price list. I was sent a humumgous (many MB sized) file - still without any prices or order form! 

Why must I have to run around just to get the basics of service when I can go down to my local supermarket and buy similar products (and, yes, I know some of their products are great, which is why I was interested in the first place) at SA, rather than US, prices. 

The end result: Still no purchase to date!

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## Dave A

> I still haven't managed to find someone in my area that is *just* willing to sell me the products that I want!


Ditto! And for me it shows a weakness in the model. We see "business owners" who are not interested in customers, only "franchisees*". _Somebody_ has got to be prepared to supply product to customers, and if no-one is, you have to assume the retail part of the model simply isn't viable. If there is no value in the retail add-on, wholesale purchase "savings" claims are more theory than reality.

* OK - I know that downline aren't franchisees, but that's what is going to happen when you use franchising as an analogy in your "pitch."

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## thebanman

Ouch, sounds like we have all had a fwe nightmare stories. I think on a whole that due to experiences like this, SA has developed a bad taste in the mouth for MLM. 

One thing I see is that there are great MLM'ers and not so great MLM'ers. and we seem to run into a few of them all the time. Maybe its because there are more not so good ones than there are good ones. 

I have joined a few MLM's mostly from and interest point of view. And have had a few interesting experiences. I have felt like I have been taken for my sign up fee and my "sales volume" alone. 

Recently I have joined an MLM company that has just open in SA. It's early days here so you can understand that there are a few hic-ups getting this rolling. The one thing that has impressed me is that amount of authenticity. that is displayed. I have spent the last week with my upline from the States and he has been so amazing. Everytime he talks about the business model its about "the people you have helped" rather than about "the money you have made" and it's not just a pitch.

When I was approached with this opportunity I was asked if i was interested in a new MLM company in SA. I was not asked the steriotypical "come to a meeting" question and then when you ask more they talk in circles never letting you know. Then you get there are you realize you have waisted your time coz you have already been to 5 of these presentations. Thats the authenticity that I'm talking about. 

In short... The most important part about MLM is your direct up line and the team you join. 

I have an awesome up line and the most amazing team and because of that I have had a great experience. 

Bryan

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## Dave A

For the record - I wasn't "burnt." No nightmares here but I'll save that story for another day.

Part of the original N21 model was "Get 10 customers." That seems to have been dropped locally. I just question why?

Because the _big_ money is in building a downline? (The preferred explanation), or
The retail model isn't viable.

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## Ann Williams

Hi Bryan

It's great to see a MLM company where integrity seems to be key. 

MLMs all started off with the idea of being able to distribute product through a series of individuals working for themselves, rather than having employed sales people / shops / franchising etc.

It's a great idea in helping to spread the money around and it really is a super model for distribution... It is also good to give your people training in sales as most of them are unlikely to be professional sales representatives in their own right. Altogether I think MLM is a really good marketing model.

But I feel it started to break down when more and more emphasis was placed on the business model and what I call negative marketing (almost religious zeal, painting only the rosy picture to outright lying etc).

What a pity. Let's hope something like the company you were talking about helps to change that image in SA.

Cheers
A

PS. Who are they and what do they do?

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## thebanman

Hey Ann, 

The MLM I'm involved with is Pharmanex. They are part of Nu Skin Enterprises. Check out http://www.pharmanex.com. What I was impressed with is the fact that of all the people I have spoken to they all have the Mission of being a "Force for good in the world."

Take a look at http://www.forceforgood.org. 

It's great to see a group of people dedicated to one vision. I feel this is the vision that keeps out the bull dusting. 

http://www.pharmanex.com/corp/pharmanews/index.shtml - This is another good read. 

In short I'm VERY impressed. 

This is a solid company with a solid vision. I have just read Robert Kiyosaki's book Before you quit your job (Which I read after I quit my job - Ha Ha Ha) And in there he talks about the power of a mission. 

These guys are looking to be a force for good in the world and to consolidate the health and nutrition industry with their award winning "Pharmanex BioPhotonic Scanner" 

They offered me a fresh look at the MLM industry. Not to mention that the MLM industry is one of the fastest growing industries world wide. 

Bryan

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## dianezenga

I am very new here, only my second post, but I can tell I am really going to like it here and learn a lot too in the process.  As I said in my earlier post it is great to communicate and get ideas from other MLM'ers.  Not everyone understands this sometimes crazy profession we love. 

My advice to those new to MLM is research the business you are thinking of joining thoroughly.  It helps too if you have a passion for it or really want to change your life.  I really did not know I had a passion for it until I found my business I am doing now.  Now I am in love with network marketing.  I find it so much fun and I meet so many great people and all the knowledge is amazing.  

Anyone else on here from RI?

Have a great day and Much Success to you all!  Diane :Smile:

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## Dave A

> Anyone else on here from RI?


Be that this Rhode Island, USA?

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## dianezenga

Yes Dave A it be "that Rhode Island"..lol

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## dianezenga

Bryan,  I agree with you completely about the "team" and how important it is to have a good upline.  When you get right down to it a great business is only as good as the people you have on your team.  I know I personally love talking and learning from my upline while passing on my newfound knowledge to my downline.  I teach them all that I can for that is the only way to succeed.  Go Team!

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## Kevm

Hi, 

Just a comment on the 10 customers query Dave A. I think it all goes together with Bryan's comment with regards to the team. 
I know from network 21 that its about duplication and combined spend. Customers are great. Its also a mutliplier effect. If 10 people found 10 customers. then thats the spend of 100 households. It builds stronger more profitable networks!
The key to building a great business in network 21 is people and relationships. The ones that do it the dodgy way dont have sustainable businesses. Which in a sense goes against what an MLM is all about.

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## Dave A

With all due respect, KevM, that's ducking the issue. If your business is supplying 100 households you're well on your way to some reasonable commissions.

My question on the retail aspect is: Are customers a viable profit centre for the individual distributor? 

No leverage, no commissions, just straight markup - Is it a profit centre that could put food on the table on its own?

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## Kevm

Hi Dave A,

Yes supplier more households as customers can help add to profit. It will help increase your turnover then providing you with a greater rebate.
However as the only source of income. You could do it if you really wanted to. I dont think it would be able to fully support you. If you want to do all that running around just for the retail then I would suggest rather joining a Direct Sales venture. The main reason for a Network Marketing venture is passive income.

So to answere your question, no. Customers are not a viable profit centre for a distributor. The product and the structure is designed for a Network.

So you cant really blame a Networker for wanting to build a Network. Thats the point of it.

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## Dave A

> Customers are not a viable profit centre for a distributor. The product and the structure is designed for a Network.


Hooray - an honest answer.



> So you cant really blame a Networker for wanting to build a Network. Thats the point of it.


Aha! Now that's where the problem starts. 

The original MLM concept *did* involve a viable retail markup for profitable (and competitively priced) retail selling. Unfortunately with most of the international MLM schemes this element is lost due to the Big Mac index factor.

What we see here is the result of perverting the purpose to suit penetration of markets despite the weaker buying power of their currencies. The concept has lost a leg, and is the poorer for it.

Consider this - Is Mary Kay a direct selling operation because it has a viable retail margin?
And if so how different is it to the Amway reward structure?

Sidenote - for Amway and Mary Kay distributors in first world countries who happen to read this, you won't understand this question.

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## Jaq

> I believe in MLM, particularly as a solid sales network - as long as those who enter it do so after having made a solid business decision rather than an emotional one based on pitches to become a member.
> 
> One of the things that bugs me about the Network 21 is that although my hubby has been approached, been to the introduction evenings (yes, plural), been given 'info' on the products, and gone through their materials - I still haven't managed to find someone in my area that is *just* willing to sell me the products that I want!
> 
> I don't want any sales speeches, invites to attend any get togethers to get to 'know more about our products' or 'to learn more about the best business opportunity on the planet'. I just want to know how much the washing powder is going to cost, how long it will be for my order to be delivered, and someone who can answer my specific questions without giving me the business equivalent of a religious revival meeting sermon... (And don't try to sell me their toothpaste, especially when I have already said "no".)
> 
> I also don't have the inclination, time or contact network in my area to become a member, so don't even ask me (let alone pester me).
> 
> A few months ago I asked again for a catalogue or at least just a price list. I was sent a humumgous (many MB sized) file - still without any prices or order form! 
> ...


In my opinion the MLM business model is all about the network-building and the income from that. The products for sale seems to be a side issue.

In as far as it's someone's chosen way of maiking money, it's fine, but I feel that in difficult economic times (like we are experiencing now), many will be drawn with promises of easy riches, and end up spending a lot of their time making money for those higher up the pyramid without seeing income equal to time spent.

What I dislike most about MLM businesses is how it can potentially ruin relationships, where people are so driven to build their network that everyone they know it a new prospect... and a new prospect for extending the network.  People who miss-use firendships or family relationships to recruit new people to their network.




> Hi Dave A,
> 
> Yes supplier more households as customers can help add to profit. It will help increase your turnover then providing you with a greater rebate.
> However as the only source of income. You could do it if you really wanted to. I dont think it would be able to fully support you. If you want to do all that running around just for the retail then I would suggest rather joining a Direct Sales venture. *The main reason for a Network Marketing venture is passive income.*
> So to answere your question, no. Customers are not a viable profit centre for a distributor. The product and the structure is designed for a Network.
> 
> So you cant really blame a Networker for wanting to build a Network. Thats the point of it.


To say that the main reason for Network Marketing (or MLM) is for passive income, does not seem to be linked to reality.

Network marketing is anything but passive... even for those higher up the pyramid. 

Those at the bottom have to constantly find new network members, and those at the top have to keep on convincing their downline that they will also one day get to that level.

Why, if a product is so good, would regular stores not want to stock it?
Why, if it's such good value, is there at least four levels of commission built into the price?
Why are people mostly approached about the income prospect and not the product itself? 

While typing this I'm using a VOX wireless router (and phone) that is also sold through Network Marketing, and I'm even a passive part of the network, but I do have to wonder how much cheaper this product could be without the MLM element? 

Does Network marketing simply feed off our need to "get rich quick" while only really financially benefitting a few at the top?

One can of course argue that the shelf-packer at Pick n Pay works very hard to make those at the top of that empire very rich, but the difference is that the shelf-packer does not try to recruit his friends and family as fellow shelf-packers with promises of riches. 

Or perhaps a more fair comparison: The sales person at Hifi Corp normally does not try to recruit those around him to also work for the company. He might tell them though if there's a good deal.


....sorry for the wordy post!  :Smile:

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Dave A (13-Jun-09)

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## IanF

> In my opinion the MLM business model is all about the network-building and the income from that. The products for sale seems to be a side issue.
> .....
> Why are people mostly approached about the income prospect and not the product itself? 
> .....
> Does Network marketing simply feed off our need to "get rich quick" while only really financially benefitting a few at the top?
> 
> ....sorry for the wordy post!


Jaq
This is a must read for anyone trying MLM. That old saying "If it seems to good to be true it is!" Anyway anyone here with a regular passive income selling reasonable products.

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