Multilevel Marketing: A Viable Option for Busy Moms and Dads

Multilevel Marketing: A Viable Option for Busy Moms and Dads by Fabienne Swartz

{3:29 minutes to read} Network marketing, or multilevel marketing (MLM), is a type of direct-to-consumer business that relies on a decentralized network of sales representatives to market a product. MLM companies generally have no fixed hours like a traditional 9-5 job, which presents a viable income source for families with young children—as well as retirees living on a fixed income.

Unfortunately, when some people hear about MLM they immediately think of so-called “pyramid schemes,” wherein the main goal is not to sell products, but recruit distributors who work under you in the “pyramid.” Another concern many people have is that they will be forced to sell products to their friends and family—something that I have seen first hand is not true.

So how do you tell the difference between a sustainable MLM company and a short-lived pyramid scheme?  

  • Selling vs. Recruiting: The Federal Trade Commission defines a pyramid scheme as one in which the individual concentrates solely on recruiting more representatives, not selling products. Reputable MLM companies employ representatives who sell the product primarily, with only some of the concentration on recruiting others.  
  • Know what you sell: Try the product you are considering selling. Is it more gentle on the environment than products available in stores? Many MLM companies market products that are less irritating than traditional products. Do your research!
  • Research the company: Find out how long the company has been in business and whether there are ratings for it on consumer websites such as the Better Business Bureau.
  • Check the management: Who is the owner? What is the creation story of the company?
  • Compensation: How and when do you get paid? What perks are available? Does the company have a minimum of products that you must sell?
  • Marketing systems and tools: Does the company provide you with marketing materials such as a website or business cards? What sort of training do they offer?
  • Marketability of products: Is there a demand for the products? Does the product fill a niche that is otherwise neglected?
  • Company culture: What does the company stand for? Many MLM companies are committed to making environmentally sustainable products, while others have foundations that address social issues in society.
  • Promises to get rich quick: Does the company make unrealistic claims about how much and when you get paid? As Ralph Kramden learned many times in The Honeymooners, get rich quick schemes are almost always scams.   

MLM is not for everyone. Take for instance this quote from a former distributor in British Columbia:

I was once the top seller in all of Canada, but it was hard for me to make money because I would constantly feel bad for people and offer discounts that I really couldn’t afford. I know someone, though, who is wildly successful at it, probably because she has a better business sense than me.

The important thing to remember about MLM is that, like any other job, you are using your employer as much as they are using you. If you go into a situation well informed and looking out for your own bottom line—and you are ready to work hard—you can turn the tables of any situation in your favor.

If you would like more information or strategies that can help you incorporate MLM into your post-divorce or retirement spending plan, contact me to go over the numbers.

Fabienne Swartz JD (Belgium) CDFATM
Certified Divorce Financial AnalystTM
www.financially-strong.com
500 Mamaroneck Av.
Suite 320
Harrison, NY 10528
(914) 798-6940

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