MultiLevel Marketing What Is It Really?

Since 1945, when Mytinger & Casselberry created the first documented Multi-Level Marketing compensatory plan for a company called Nutrilite, millions of people have joined a network marketing opportunity and many have gone on to form great fortunes.

But what is network marketing, exactly?

Rather more important, is starting a network marketing business something you should actually consider as a choice to help take back control of your monetary future? Let’s take a more in-depth look to find out not only “what is network marketing” but also if it is sensible for you and your folks at that point in your life.

What is Network Marketing – Defined

According to a Wikipedia entry, MLM marketing is a sort of marketing system that pays an independent contractor ( YOU ) a commission for product sales and also a commission for the sales of other independent contractors you induct to also promote a corporations products or services.

The Small Company Encyclopedia has a more challenging definition:

What is Network Marketing? It is a proved business structure which uses an independent distributor network to build the business by promoting services and goods. Customarily these companies are also multilevel in nature meaning they pay out commissions earned on more than one level.

What? Are you confused yet?

Let’s break it down into language everybody can understand, shall we?

How Normal Business Works

Every business offers a service or product for sale. The goal is to generate a lot of sales and make a profit. To insure a nice profit, the price of getting the product to all the way into the end users hands has to be less than the final selling cost. If it cost $10 to supply and promote the product and people buy it for $20, the company makes a decent profit. If cost-of-good-sold is $10 and the product sells for as little as $9.95, the company loses money and will soon find themselves out of business.

Traditionally a product is first manufactured or produced. It is then packed and sent to a distributing warehouse. The distributor makes sales to a retail outlet and the retail outlet sells directly to the purchaser. Everybody attempts to make a profit along the way.

A direct sales business often hires salespeople to literally market the product or service straight to the consumer. As an example, somebody knocks on your door and offers to give you a free quote for landscaping. If you make a decision to hire this company, the direct sales person who came to your door receives a commission. So their livelihood depend entirely on how many sales they personally make.

What is Network Marketing Explained

Like each standard business, a network marketing business also offers a spread of services and goods for sale. And the goal is also to make a profit by making sales at a price higher than it costs to get the product into the hands of the people buying it. But that is about the one thing a Mlm company has in common with normal business because most multilevel marketing companies are a type of direct sales business with a twist.

The twist is they don’t hire salespeople to bring their product to market. Instead they offer folk like you and me the chance to “sign up” as independent contractors to sell their goods and services and earn some cash if and when we makes sales. If you do not make sales, you don’t make any money.

So far so good. But it gets even better . Because you’re also permitted to refer folks to the company to “sign up” to become independent entrepreneurs as well and, when you do, you will also receive a commission on all the products their new business brings to market. And since you can refer a vast number of folks to become business owner, the revenue opportunity open to you is also unlimited.

What rather more information about “What is network marketing??” Click here to see a network marketing compensatory plan explained and to discover exactly what you need to do to place yourself on the inside track to creating wealth while enjoying your life.

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