Since becoming a stay at home mom, I have been approached and received emails about becoming some sort of rep for a Multi-Level Company. Many have asked me if this is the best way to take care of their financial issues. Others want to know if MLM is the smart way to become debt free.
For those not aware of what a Multi-Level Marketing (MLM) company is, let's begin from there. I know almost everyone has heard about one or two of these companies when growing up. Companies like Avon, Thirty-One Gifts, Mary Kay, LuLaRoe are popular MLM companies around.
So what is a Multi-Level Marketing company?
A Multi-Level Marketing (MLM) is a marketing strategy in which the company gives compensation not just for sales, but for having other salespeople under you. Meaning you get paid for sales while also getting compensated for referring others. Their advertisement comes in the form of their sales people, through the sales, and referrals as well.
MLM companies are often compared to pyramid schemes because of the way they run their business and their set up. To begin your business with an MLM, you must pay for your marketing kit and products to go with your business. Since you are paying to start a business, this will pay for itself after a few sales and referral of others.
Some MLM will start you on an auto shipment, so I will remind you to please make sure you are aware of this. You don't want to have a surprise on your bank account statement because you were billed for a monthly auto shipment.
The majority of these companies do not advertise the way other companies do. They advertise directly to customers and through word of mouth. Recently many companies are using social media, like Facebook and Instagram. Multi-Level Companies are now available in all 50 states and Puerto Rico and are everywhere.
Every year you hear about the latest Multi-Level Company out there from wraps, beauty supplies, essential oil, and leggings. Many of these businesses have been around for decades and are well known and established.
The U.S. Federal Trade Commission (FTC) says that you should stay clear of MLM companies that pay commissions for recruiting new distributors. This is when it becomes a problem; when you are only focusing on recruiting new people and not selling any actual product!
Make sure that the money you are making is actually from the sale of a product, not from recruiting others. If the company money is based on recruiting other people, then I will suggest you move on.
MLM (Multi-Level Marketing) companies do have a bad rap, and to be honest, I tend to stay away from them; not for the reasons, you might think though (More about my reasons later). For stay at home moms, MLM companies sound like a great way to earn some extra cash while staying home with their family and making an income; many MLM companies targets stay at home moms for these reasons.
Do I think all MLM companies are evil? No, I don't. Do I believe that you can make good money and be successful with an MLM Company? Yes, I do. Would I join an MLM? No, I know that makes no sense, but I will explain myself in a minute.
Yes, you can, and an MLM Company might be the right thing for you if you know what you are doing and you are ready to work hard.
Research the company
Granted, many companies out there do an excellent job at making it hard to look for a dependable, honest review. Continue to do your research and ask questions. Learn about the company and how they run. Learn as much as you can about the company, always check and double check for credentials.
Can you afford it?
Many MLM Companies require you to pay for the starter kit, products, etc. Some will automatically set you up for a monthly auto shipment. Are you able to afford this? Always make sure that you know how much you have to pay up front before committing.
Do you stand by this product?
You need to be able to stand by this product and be able to show it. If you don't like or wear makeup, then you shouldn't be selling beauty products. If dieting is not your thing, then stay away from selling dieting supplements.
You are going to have to be able to sell these products to your customers. You are going to have to be able to stand by your products and KNOW your products, or you are going to fail at this business and kiss your investment good bye.
Know what the product is about and learn how to sell it. Follow all company guidelines and NEVER make false promises to sell the product. BE HONEST.
Why are you doing this? The money?
This is going to sound crazy, but if you are only doing this for the money, this is not for you. You have to love what you are doing, and you have to be willing to help others. If you want to succeed with an MLM company, and you want to work with others and be successful, you have to love what you are doing and what you are selling.
To build your business, you must help others. When you start to have people working for you, you have to make sure you treat them with respect and coach them. Remember this is a business, your business, and all the success depends on you.
If you are doing this for the money, then you will lose track of what's important and start looking for distributors and not the actual sale of products; this is when it becomes a scheme. This leads to exaggerated money methods to get recruits; this won't cut it. This is not a get rich quick scheme; you will fail in the long run. People will start to avoid you if you sound dishonest.
Remember, these companies operate by word of mouth; people will surely pass it around about your shady tactics.
Are you ready to work hard?
The top distributors didn't become debt free by simply sitting at home and doing nothing. Just like any other business, they busted their behind and committed themselves to be successful with the company. What you see on social media, the big homes, the luxury cars; this is all from their hard work they invested in the MLM company.
Do you want to make money? You have to sell the product. You have to run this as a business. Avon ladies didn't sit at home, they went out and sold their products. The couple selling LueLaRoe isn't sitting at home with a stock of merchandise, they are hustling and selling their products. The same goes with any MLM company you invest your money on.
How long are you going to commit?
The bonuses sound amazing, but how long will it take to receive your first bonus? Are you going to reach that bonus sale in 3 months? Are you going to have the stamina and motivation to continue to sell this product after the hype or your family and friends aren't interested anymore?
Are you willing to have people over your home for demonstration? Are you willing to leave your children to host events? Are you prepared to have a live sale almost every night on Facebook? How much are you ready to commit to this business?
Do you have a business plan?
Like any other business, if you want to become successful and be debt free, you have to have a business plan. You have to have a budget, and you have to be ready to execute. Set business goals to keep you motivated and focused.
MLM Companies are businesses.
Just like you want to sell their products, MLM companies are businesses that are built on hype. They want to attract potential distributors because that's what their business is about. It's about making money. Don't get caught up in all the hype and invest more than you can chew.
My reasons I stay clear of MLM Companies.
I am personally not a go-getter person that loves to sell products to others. I am very frugal; I'm passionate about it. I haven't found a product that I stand by 100%, and I'm willing to commit to. I have been emailed and personally asked to start selling products with the dreams of becoming rich, debt free, and having a glamorous life.
Though I respect and admire them for becoming successful, I can't personally see myself selling products that are priced above my personal budget (though I am sure they are good products), or can't personally relate.
This is why I stay clear of promoting essential oils on my blog because though I enjoy them, I am not passionate about them. Forking out hundreds of dollars for starter kits of essential oil, and say that they have changed my life is not my style. I used them for many years on and off, but I won't commit to selling them.
I love seeing the success of many people selling their product and respect what many have done and how they have turned their MLM business into a success. See how they helped others succeed too is amazing; but like many businesses, it is not for me.
Am I saying I will never deal with an MLM company? No, I just haven't found something that I am passionate enough about and are willing to invest my hard earned money on and commit.
If you are comfortable with MLM companies, and you are ready for the challenge and the hard work, then I say you can become debt free with an MLM Company. Just remember that just like debt freedom, this won't happen overnight. It takes hard work and dedication to become successful.
What are your thoughts about MLM Companies? I would love to know about your success with an MLM company. Please share!