10 Important Factors To Consider When Choosing A Solid MLM Or Network Marketing Company
With so many MLM and Network Marketing companies to choose from, what criteria should one use when picking?
I have compiled a list of 10 factors that I use when choosing a company.
#1 – Can the companies profitability be verified? Is the company public or private?
A public company is (usually) going to be more stable and (real) information is more accessible.
Know what the company’s profitability is. 100 million in sales doesn’t tell the whole story. What were the expenses?
#2 – Age of the company - If it’s a private company, you can’t verify it except tax filings.
(This is not suggesting that private companies are bad business. It’s just a point to consider in the grand scheme of things.)
Age of the company is critical when choosing a networking/mlm company for long term residual income. If a company is less than 7 years old, I won’t even look at it. I don’t like being involved in experiments and until it has been around for at least 7 years and gone through it’s ups and downs, that’s all it is.
Huge promises of a free down line in the pre-launch is just hype. If it was true, why do they need you or I? Usually the hype is bringing in a lot of pre-sign ups but when it comes down to actually buying in, the majority will disappear into thin air.
#3 – Exclusivity Of Product – Very powerful qualifier. Exclusivity doesn’t exactly mean being the first ever on the market. There can be a lot of risk by being the first ever because there is no familiarity with the idea. However, it’s about finding something with a new twist.
A gumball machine isn’t new, but a machine that makes the gumball and gives it your favorite chosen color right before your eyes is.
Patented technology or patent pending technology is an awesome qualifier.
#4 – Love, health or wealth - Does your product or service provide for a core desire or need for mankind?
Marketing a product that is primarily focused on the moneymaking aspect or wealth will result in a much greater struggle building a long-term organization. On the other hand, if you are satisfying the love and or health needs/desires of your prospect, your road will be much easier.
Here’s an example: If your prospect has cancer, his health is a high priority right now, plus his love for his family and being around for them is a very high desire as well.
Think about the drug company and the little blue pill. Mucho denero!
You may not want to agree with this one but if you look closely, you will have to agree, love and health are where the long term money is.
#5 – Can you be passionate about the product?- Are you passionate about the product or the opportunity? In other words, this product is the best thing since sliced bread and oh by the way, I can make a lot of money marketing it.
If you will use the product or service with or without the opportunity, then you have a winner!
#6 – Compensation Plan – Not a make or break, but a consideration point. Residual payout should be at least 40% on the dollar with a maximum of 45-50%.
I didn’t say up front commissions, I said residual walk away income.
A comp plan paying 60-70% is a red flag for me.
A stable company with a real product and a patent or patent pending, won’t be able to pay out that high of a residual commission (usually). Most of the time, it’s the start up companies that will offer pie in the sky start up commissions and or residual income, then as the company learns lessons and adjusts to reality, the commissions will change and the down side is, the associate base won’t adjust very well. (I wouldn’t, would you?) A company that is going to make it long term, 5-10-20 years or more won’t be able to pull that off very well.
#7 – Credibility of the company – Real product with credibility, and physical proof, (science). Does the company have a strong management track record behind the company?
What is the company’s reputation? Have they changed their name? A company with a good name will not have to change its name 10 years or more down the line.
#8 – Company integrity – company’s compliance in the industry. This is usually related to health companies. Your company should be extremely cautious about testimonies and how they are used.
Companies have been shut down because this envelope has been pushed too far, one too many times.
Does the company under promise, over deliver. Are you using the products and getting the results that are being touted by the company?
#9 – Market Saturation And Availability - Can everyone get that product?
How do you tell if your market is saturated or not? This is a tough one, but are you sick and tired of hearing about this product?
#10 – Terms, conditions, policies and procedures - How restrictive is the contract? You want protection from the idiots out there that will ruin business for everyone, but you don’t need two hands tied behind your back.
If a company told me I couldn’t market any other product, even if it was unrelated, or not in direct competition, or I could only market the product one particular way, I’m not interested and you shouldn’t be either.
Remember, lawyers wrote those contracts for the companies benefit, not yours. You should read it carefully to protect yourself and your business.