Year MLM home business It is a great way for a company to bring product to market with little overhead. It is also an excellent business model for the independent contractor or representative to build wealth through a leveraged asset and residual income stream. The model is successful because it revolves around selling the company’s end products before commissions (or advertising, for that matter) are paid. But what marketing approach or philosophy will generate the most profit?
An MLM home business company only pays once what they are marketing has been sold. And regardless of what a company sells, no one gets paid unless something is sold. Something (a product, service, membership, etc.) must be purchased before anyone in an MLM home business organization is paid. That transaction determines who and how much gets paid.
3 main approaches or philosophies to consider when it comes to generating income with the MLM home business model:
1. The first MLM home business approach is the retail sales model.
This is the lowest income approach of the three and essentially involves buying a “product” (which could be a product, service or membership) at a discounted or wholesale price and then turning around and marking the price to allow you make a profit when you sell it This is a direct selling approach. The more “product” is sold, the more money is made. The amount of revenue is directly related to the amount of “product” sold and the amount of profit added to the price of each sale. When no sales are made, no income is received. Pretty simple and self explanatory.
Many people new to the MLM home business industry or unfamiliar with the industry mistakenly believe that this approach is the primary marketing approach one must follow in order to see success with an MLM home business. This is where sales type objections usually come from, where a potential prospect learned about the MLM home business model when someone was trying to sell them an MLM home business “product”.
2. The second MLM home business approach is the wholesale model, which focuses on organizational sales.
Instead of relying on just one business owner to sell “product,” this approach broadens the focus by bringing in a few other people to help increase overall sales volume, getting a little less per sale due to having to pay the team part of the commission of each sale. So now there are, say, ten people allowing ten times as much product, allowing one to perhaps multiply one’s profits by 5 (to account for the profit margin being cut in half, say).
This is a better model in the sense that it allows you to leverage yourself a bit, allowing you to increase your income and profits by being able to move more “product”. However, the focus here is still on the “product” itself. If a person limits his operations to only 10 people and himself, he is limiting his income since the 11 of them can only move a certain amount of product. In addition, they depend on the 11 people to continue their level of production to maintain the level of income and profits. So it’s a better model than the first model when it comes to revenue and profit, but it’s still a “sales job” and limits one’s earning potential.
3. The third MLM home business approach is similar to the second approach, but the approach and philosophy are totally opposite.
The focus is on building a team where many people can move just one small product each instead of the other way around. The team creates leverage to allow you to win a little from a lot of people, able to win a small percentage of hundreds rather than a larger percentage of just a few.
