Network Marketing and MLM – Frequently Asked Questions

If you’re looking at a network marketing or MLM home business, I’m sure you have some questions about how the business works and how to choose a good opportunity.
Following are some questions that many people ask about network marketing. These are some of the basics.
Please – I encourage you to comment below and post any other questions you often hear about network marketing and MLM, and how you answer them. There are many great questions out there that I’m not listing.
Where do I begin when choosing a network marketing opportunity?
Your best bet is a company that has been around at least 2-3 years, preferably longer. As with any other business, network marketing and MLM companies can start and fail for a lot of different reasons. Companies with a record of stability and good service offer less risk and better odds for establishing a long-term income.
I’ve heard that network marketing is a “pyramid scheme”. What is that all about?
“Pyramid” schemes offer fast money earned by selling the right to recruit others. They often have a product to help make them look legitimate, but it will have little real value. The real money is made by recruiting other people into the scheme, not through sale of the product. Some of these scams don’t even offer a product – they just move money around. A true network marketing or MLM opportunity will offer real products, and place some emphasis on sales to customers who are not involved in the business opportunity.
What about “getting in on the ground floor” with a new company?
This is a big risk. If you go in knowing the odds and have money to put into it, it is possible that working with a startup business can be rewarding. Every solid and reputable network marketing company today was a startup at one time. Just be aware of the risk. More established companies offer a better shot at long-term income and stability.
How do I get paid in network marketing?
There are several types of network marketing and MLM compensation plans. Some of these are called “breakaway’, “binary”, “unilevel”, and “matrix”. There are others that are a blend or spinoff of these. You can build a solid business and make money with any of these plans. The first thing to look at when evaluating an opportunity is the company (stability and track record) and the product line (quality, value, will people want to buy them).
Will I have to buy an inventory of products?
Purchasing an inventory of products should not be a requirement to sign up. It should be an option. In some cases, having a product inventory makes sense. However, your retail customers should have the option to order the product direct from the company using your ID. Inventory is important if you are building a business around retailing products (direct sales). In network marketing and MLM, this is not usually something you need to do.
Once I find a good opportunity, what next?
Consult your sponsor and upline leaders. They should help you develop a plan for starting your business successfully. Your upline and company should have training and a “system for success” in place that you can work with. Be sure and ask this question before making your decision: “What training do you offer to help me get started successfully?”
Can I build a network marketing business online?
Many people have succeeded building a strong business online. You will need money for advertising. Keep in mind that online MLM is still a people business – you can’t hide behind a computer and be successful. You can reach many more prospects and grow your business faster, but you still need the personal contact.
A final thought…
Network marketing is one of the best ways to start a home business. It requires a small investment, much less than opening a traditional business. You can make a lot of money in network marketing. For this reason, scammers all over the place are peddling deals that appear to be legitimate network marketing or MLM opportunities. Just be careful and do your homework before signing up with anyone.