MLM = Make Little Money?
) is way to reach for the stars, live out your dreams, work for yourself, be all that you can be--all
while making on average $115 per month...
According to the disclosure from what is arguably the
world's largest and most well known multi-level marketing organization,
) the average monthly gross MLM income
for "active" IBOs
(Independent Business Owners
) was $115--and, depending upon the definition of
"active," may actually be quite a bit lower.
Wait! Many non-MLM small businesses fail because their owners simply don't
have what it takes or circumstances are such that success is just not in the
works. Does the failure of many small software companies to make a lot of
money mean that there is something wrong with the business model of other
very successful software companies like Microsoft or Google or others? Why
does MLM get such a bad rap--and is it deserved?
Let's take a look at each of these issues in turn and then you will see that
many people in the MLM world, although exuberantly optimistic about their
prospects for success, are in fact cramped into a system that at best
restricts their true earning potential and at worst ends up costing them
quite a bit of time and money with little or no payoff.
MLM vs. Regular Small Businesses
Many people in MLM fail to make a lot of money. Many small businesses fail
to make a lot of money. Therefore the failure rate of MLM cannot be used as
a criticism of MLM, right? Wrong.
The premise of MLM success is based in large part on recruiting additional
sales reps to join up under you (called your "downline"
) rather than working
to sell something useful to others--because after all, sales is critical to
any small business not to mention being a sales person is a noble profession
and potentially very lucrative.
"Well, I like to think of myself as just a type of headhunter or recruiter
when I try to sign up new recruits under me
," a fervent MLM supporter may
say. The issue with that line of thinking is that (wait, you might not want
to hear this but here it goes...
) making money is hard work. Making money is
not something that starts to happen by magic after attending X number of
motivational seminars or by investing X amount of dollars into training
In fact, making money is not just hard work but different people have
different skill sets and will be successful AND unsuccessful at different
things. If you sat down in front of a computer and attempted to do things
like write a car insurance guide
or designed a payday loan calculator
or other similar things that I
enjoy working on, then you may not even know where to start. Just like if you
put me in front of a class of high school kids to teach even a basic science
class I would be as lost as a penguin in the Amazon.
MLM's Two Faulty Assumptions
The two major faulty assumptions that MLM makes are:
- Everyone can make good money by simply following the outlined steps. (Not
true. It takes a lot of hard work, know-how and skill to have success in
- Everyone can be good at sales. (Not true. Many people are, in fact,
horrible sales people and always will be as their skills lie elsewhere.
Sure, some people make money, but most
MLM ventures don't pay off and to pigeonhole everyone into the mold of an aggressive
sales person is not only unfair to the recruit but also the recruiter.)
These faulty assumptions are seen in many commission-only sales
industries to some degree but, with the financial incentive in place for members to recruit their neighbor, their brother and their grandma, the
negative consequences of these faulty assumptions for MLMs are accelerated.
So...What is an MLM Alternative?
What do you ask is a good alternative to MLM? Well, I am glad you asked! Of
course, there is no one right answer, because--as I mentioned
above--everyone has different skill sets and where you may be wildly
successful I might not be, and vice versa. That being said, here are some
general principles for finding an MLM alternative that you can pretty much
take to the bank:
- Use Your Strengths - If you are a natural sales
person and absolutely love people and love selling then by all means take
some sales classes, apply for a job as a sales person, start your own
business relies on you selling for your success (e.g.; insurance
agent, real estate agent, etc.) BUT just because many MLM programs force
everyone into the mold of being the uber-outgoing extrovert who sells 24/7,
don't let that force you to ignore your own strengths if they're something
different than sales. If you are awesome at writing computer programs, do that! If you are awesome at graphic design, do that! If you are
awesome at baking cupcakes, do that! If you--well, you get the
- Copy Someone Successful - Once you find something
that you are good at, then look for a role model and copy some of their steps to success. The funny
thing about MLM is that chances are the person who recruited you is not
making a whole lot of money. Chances are the person who recruited the person
who recruited you is not making a whole lot of money. You likely have to
trace your way back to the person who recruited the person who recruited the
person who recruited the person who recruited the person who recruited the
person--again, you get the idea. If you want to design computer programs for a living or build custom swimming pools for a
living then find another small business owner who is successfully doing just
that. Emulate some of the things that they did to achieve success in your
- Focus and Work Hard - You may be tempted to
just gloss over this section because the advice is so common sense. What is
likely the most important piece of advice you can get is to focus in on the
goals that you want to accomplish and then dedicate yourself to working
extremely hard to accomplish them. Whether you are building swimming pools
or baking cupcakes for a living, there is no shortcut for focused hard work.
The fact that the majority of the time spent in MLM meetings is devoted to
encouraging those who are not doing so well (the vast majority) with rallies
and pep talks should speak volumes about where the focus lies and where it
should be. There is no easy get rich quick scheme online, offline or
anywhere in the real world. The same timeless principle of properly focused
hard work is the only route to lasting success. There is no shortcut.
Have you ever found yourself suckered into an MLM meeting only to
discover it was not what you had thought it was? What did you learn? What advice would YOU give to someone considering MLM?
Joel Ohman is a Certified Financial PlannerTM
and serial entrepreneur who has founded five companies. His most recent
projects include building consumer comparison websites for car
insurance and credit cards. He loves buy one, get one free coupons and
recommends checking out the Savings.com coupon section of the
site--after reading this article of course!