Network Marketing MLM Home Business Basics
The network marketing MLM home business is just one of the many businesses you can start and run out of the comfort of your own home. Network marketing, otherwise known as MLM or multi-level marketing first emerged in the 1940’s when a few companies recognized that their sales representatives and customers mostly consisted of family members, friends, and relatives of other sales representatives, the reason being that these individuals received a discount on the products/services if they had connections in the company. And so the basic MLM business model was born. Since then, it has evolved to encompass thousands of businesses around the world, with varying structures and compensation plans. But the one aspect that makes an MLM an MLM is that there is no middle distributorship in the sales of the products/services offered. The products are sold strictly through independent distributors, not in stores or shops. The other aspect is that distributors are paid commissions on both the products/services that they sell, as well as the members that they can bring into the company to act as part of their sales force. The network marketing industry has suffered greatly due to the emerging of Ponzie and pyramid schemes at about the same time that network marketing was born. Ponzi and pyramid schemes are illegal operations that do not actually sell legitimate products or services. Rather, they only pay members on recruiting other members, so there is no real value being offered to anyone. The FTC is quick to clamp down on Ponzi and pyramid schemes today, and all new (and even long-term existing) MLM companies must go through rigorous scrutiny before they can be deemed legitimate in the eyes of the law.
There are several reasons that the network marketing MLM home business is so appealing. First of all, it requires very little investment to get started, and the distributor is then provided with varying levels (depending on the company) of marketing materials and support, as well as direct access to the product or service being offered. This makes it extremely easy for anyone to get started on their own business.
The next big draw to network marketing is that it can eventually lead to residual income. As you move up through the organization, you sell more products and/or services, and you recruit more members into your sales team. And you earn commissions and/or bonuses not only on the sales and recruits that you bring in, but also on the sales and recruits that your team members bring in. This means that you are earning money by not actually doing any extra work. And this offers huge appeal. Each MLM company offers different compensation plans, so the amounts and structure of payouts will vary greatly from company to company.
The network marketing MLM home business models is also praised by two of the most successful men in the world–Donald Trump and Robert Kiyosaki.