WOW, that is a nice pyramid!

Million dollar question: Can the employee at the bottom EVER earn more than the CEO at the top while he is in level 5?????

If you listen to people comments about pyramid schemes any successful big business should be 100% illegal!  The above example is not an equal opportunity business and the first one in earns the most money!

You can see from the from the examples above that network marketing is not even close to being a pyramid scheme.

But where do they get the money to pay the commissions

This is why people are skeptical about network marketing. They do not understand the concept and they do not understand where the money comes from. So for them it sounds to good to be true and then they get all the excuses they can think of not to get involved.

Explantion: I can get people to market a product for me. I decide that if I sell the product for R150.00 I can afford to spend R40.00 on commission. So now I can get people to market my product for me and pay them R40.00 commission on each successful transaction they have.

With the scenario above we go back to traditional business. If the consultant does not sell anything today, she does not get any money. So if she goes on maternity leave for six months, she does not have an income for six months.

So now we decide to split the R40.00 in 4 pieces. We will now rather pay 4 people R10.00 each than paying one person R40.00 per sale. We create more jobs for more people. We tell the lady in this example (lets call her Cynthia)  that if she refers another sales consultant to the business we will pay her R10.00 of each sale that person makes. And that person can do the same and the next one can do the same. We continue that up to four levels. So now Cynthia gets paid for the effort she does AND for the effort of the people signed up under her. She just started her own business. She now has consultants working in her business and she earns a portion of their commission, she now has consultants working “for” her but still each one runs his/her own business.

So now Cynthia can actually go on maternity leave for six months and still earn.

So the money to pay the commission must be built into the product or monthly fee for the service. This is also a good way to see if a network marketing business is legal and sustainable. You must be able to see that the commission money is paid by the product or service. If we market a product which will cost you R100.00 per month we can most certainly not afford to pay you commission of R400.00 per month. If you see something like that you know you must run.

So network marketing is nothing else than the distribution of commission or the distribution of wealth. We do not pay one person big commissions, we pay several people with the same commission.

Types of network marketing

There are different types of network marketing businesses available. Some sell physical stock and others market a service or an insurance product. There are even systems where you can get discount on your cell phone bill and get paid for the people under yours cell phone usage.

So if you do get involved in network marketing you can choose a company with whom you feel comfortable. The company you choose will depend on your needs. If you need something that can build you a good income in a very short time, it is important to look at the commission and bonus structure. Do not look at the potential income when everybody signed up 10 people. That can take two or more years. Look at the short term results. Work out an example where everybody signs up at least 3 people. And see what your income will be after your level 2 or 3 have been filled in such an example. If everybody signs up at least 3 members you can fill up to your third level within two or three months easily. If you urgently needs money it is important then that the company you choose will pay you a good income in such a short period otherwise you will loose faith in the system and give up.

There are network marketing companies that will offer you an excellent product and support, but it will take you two to 4 years or even longer to earn a proper income. These ones are also good if you are looking for a pension fund instead as an immediate income.

So it all depends on your needs.

My experience is that you can be successful in almost any network marketing company. It all depends on you. It depends on your need and your desire to achieve success.

What I can tell you is that it is not so easy to make a success in a network marketing company which sells physical products. Such products are normally over priced in order to cater for the commission. Your market is also limited to people who will use your product. Your income will also depend on the sales of your down line. If they do not sell good this month, you will not earn good (like just after New Year).

If you go for a network marketing company who for example render a service to collect and distribute money to charity, then you have 99% of all people as customers. You will also do the work once and get paid for ever. Your income will depend on the number of active members in your down line and not on the sales they make. So you will know that if you ended at R2000.00 this month you will start at R2000.00 next month and grow that. So it is a more stable income.

So look for a network marketing company which render a service or financial product which are paid monthly by debit order. That way you will sign up your client once and get paid for as long as he pays his premium. But remember if that client is also earning commission like you, he will never ever cancel, thus you will have a client and an income for the rest of your life.

The most know companies who run above mentioned networks normally either have charity donation, long term insurance products or shares as products.

Grow your business

You did your homework and you joined one of the numerous network marketing business. NOW WHAT?

Most important thing to remember; Do not try to explain the business until you know exactly how it works. If the business you joined has weekly presentations in your area, rather take your potential clients to the presentations or show them the DVD than trying to explain it yourself. If you do take them to a presentation, do not tell them anything before the time.

You cannot sing the song if you do not know the words.

You must practice how to explain the business to other people. Remember this is a new business you just started. It is not a “thing”. It is your business. With anything in life we need to learn some skills before we can do it. When somebody learns to drive a motor car, he does not just jump in behind the wheel for the first time and drive perfectly from the beginning without jerking the vehicle?

So practice on your spouse, children or other family members.

Remember that the worst people to talk to are friends and family. They are the ones who will most likely tell you something like “This will never work. I know Auntie Sarah tried a thing like this and it did not work”.You cannot take advice from somebody who has no experience in what you are about to do. The only way to find out is to try it yourself. Give it 100% and see if it works.

If you talk to one person per month about your new business, it will take you at least six months to sign up one person. You MUST talk about your business to at least one person per day. This does not mean you must do a presentation once a day, this means just talk about or mention your business to at least one person a day. People often ask me where I get all the people. People are everywhere. When stand in the line at the Post Office, you are waiting valuable time. There are people standing both sides of you who cannot run away. You are going to stand there anyway so you might as well start to talk to them.

Everybody does not work at the same pace. Some people will sign up 10 people within his first week; others might take 2 months to sign up their first person. Whatever you do, never ever give up. You can rather go slow, but never ever stop.

Since I got involved with network marketing a couple of years ago one thing bothered me. I signed up with a company doing shares as a product. I signed up 5 people in my first week and I thought that this is the easiest thing on earth. So when potential clients asked me “How easy is this business” I told them “easiest thing on earth, the people fall over their feet to sign up”. 

Unfortunately I soon realized that it is only easy for me. The other people I signed up did not manage to sign up people under them. I felt bad, guilty. I told them this is easy and now they do not manage to do the same. All my dreams were shattered. I calculated that if everybody can just quickly sign up their first 5 people in their first month I could be a millionaire a year later. It did not happen. I could not understand what was wrong. I am an introvert but yet I manage to sign up people very easily but other people failed to follow my example.

This bothered me for almost two years. One weekend I attended a motivation seminar by one of the network marketing companies I joined. There was a professor giving a speech on human behavior. He gave me the answer I was looking for. In his studies he found that people will buy or sign up on whatever you sell them only 10% due to what you say. But 80% of your ATTITUDE will determine if they will buy or sign up. The remaining 10% are divided by factors like their financial position, the influence of people around them, etc.

So there you have it. It is your attitude that will determine your success. If you are going to tell a person that you want to show him a way that he can earn more money and spend more time with his family you must look and feel GOOD. The energy and positive attitude must shine from you. Keep your head high, pull back your shoulders and smile. Nobody will join if you are depressed and down. They will not believe you that what you are showing the will make their life better.

Your mindset

Your brain is a very powerful tool. Not many people realize that they can have what they want if they just focus on that. Most people make the mistake to focus on their problems. Guess what, their problems will become more because they focus on it. If you focus on the solution to your problems then only will your problems be solved.

When you go to see or call a potential client you must determine the aim of your visit before you go their. If your goal is to sign him up, then set that in your mind, focus on that ad go for it. If your goal is to go the client but just prepare him for the business, share the information but sign him up later, then do just that.

If you go to a client and you think “Ah, this guy won’t be interested, he will never sign up” You were right, he will not sign up. But he will not sign up because he does not want to; he will not sign up because that is the image you portrayed when you went to see him. People’s minds are extremely powerful. A client can see and feel your negative feelings even if you think you hide it from them.

So, before you go and see client, prepare yourself first. Get into a positive mode. Think of good and positive things and smile.

Did you know that in a study conducted by a mental institution in the US, they cured all the patients who were part of the study from chronic depression only by letting them stand in front of a mirror for half an hour per day SMILING. Imagine what that will do to your attitude if you go and stand in front of the mirror for ten minutes before you go and see a client.

Another reason why people fail to sign up other people is that they tend to believe that they cannot do this. They believe they cannot do it. So they focus on their disability to do it and BINGO, they were right, they failed to do it.

Anything in life needs practice. Do not give up after the first 5 people said no. The good news is that very often only 1 out of 10 says yes. (in the beginning). Keep in mind that they do not say NO to you. They say NO to the product or the some other circumstances. I personally believe that anybody will sign up for network marketing if you covered all their fears and rejections. Most of the time people think it is a scam or a pyramid. So the first thing you must do is to explain to them 1. what makes this different from a illegal pyramid and 2 where does the money for the commissions come from. If they know this they will feel much more at ease and will most probably sign up.

If somebody does say NO you should feel sorry for him. It is not you who are loosing out, it is him. This is the attitude you must have. You are doing your prospective client a huge favor. If he does not take it he is loosing out big time, not you. Next year this time will show him your pay check and he will regret it for the rest of his life. So do not let other people’s negative comments and feelings distract your from you mission. Remember that you offer a person not a product or a service. You offer your client the opportunity to become financially independent; you offer him the opportunity to spend time with his children. This is not only about the product or service; this business is about financial freedom.

Perseverance

The most important term in this business.

When you start in your new business you will have to have a lot of guts and perseverance. For the first couple of months you will earn little to no money. With some networks you will earn less than R100.00 per month for your first 6 months to a year. But never ever give up. A year or two later you will earn a proper income.

You will get people who say now. Remember that rejection is part of any business. In any business it happens that a potential client phones you for a quotation. The clients sounds impressed with the price you offer him and he almost kisses your feet. And then you never see him again. Will you now close your business because the client did not except the quotation? NO, of course not. So why is it that in this business if 4 or 5 people did not accept your offer you want to quit? People think that everything must just happen automatically. It does not happen that way. Some people will say yes and others will say no. If they say NO, you say “So what, who’s next?”

You must run and treat your network marketing business as a proper fully fletched business. The advantage in this business is that each customer will become your business partner and help you to grow your business. The success of each of your business partners will determine your success. In traditional jobs people stab each other in the back and step on each others heads in order to get to the top. In this business the only way to the top is to help the people under you. The more successful they become the more successful you will be. This business is not only about making money. This business is about helping others and while you do that you help yourself.