While some network marketing opportunities are scams out to swindle your money, the good news is there are far more opportunities that may be well-intentioned, yet have a poor track record for any number of reasons. So how do you discern a good opportunity in such a vast market?
Here are 10 questions to ask about the company you may potentially be working for that will help you choose wisely.
Has the Company Been Around for at Least Five Years?
If you want the efforts you put in today to pay off far into the future, choose a company that has proven it intends to be around for the long term. Approximately 90 percent of all network marketing companies fail within their first two years. You don't want to invest your precious time and resources—not to mention your future—in something that may not be in business next month.
Is the Company Well-Capitalized?
If the company is solvent, meaning it has the capital required to grow, maintain a solid infrastructure, attract talented management, keep pace with technology, and pay your commissions, then you may proceed. Publicly traded companies are required to disclose their financial condition in great detail every 90 days to the U.S. Securities and Exchange Commission (SEC) and other governmental agencies. Unfortunately, private company financials are not available to the public, so you may have to take a risk in working for one.
Does the Company Offer Products or Services That Are Unique?
Ensure that the products or services are not readily available elsewhere—especially at a discount—and they're not just another "me too" product or service that has tons of competition.
Is There a Genuine Need for the Product or Service?
You've probably heard horror stories about people ending up with a garage full of expensive water filters or other items. This happens because only other distributors will purchase the product at that price. Your product or service must fill a real need at a fair price, and there should be a large untapped market for it. In other words, it must provide tremendous value so that the customer is the biggest winner.
Also, if you're being pressured to buy more products with the lure of being placed into an "elite" category of seller, that's a red flag. Turn away from the opportunity immediately.
Is the Product or Service Trendy or a Fad?
You can't build long-term residual income if the product or service only has short-term appeal. Always think long term. The product or service must appeal to your customers beyond today. The health and wellness category, for example, tends to perform well.
Can You Generate Immediate Income?
You need to be able to finance your marketing and expansion efforts from cash flow. Having to invest hundreds or thousands of dollars up front only to see a return on investment months down the line is not a good strategy.
Does the Marketing System Take Full Advantage of Technology?
Not everyone can be a salesperson, but anybody can plug into a system and tools that do the selling and sorting for you. This can be as simple as scripts or email campaigns or as full-blown as an entire marketing funnel. The important thing is that you're given a marketing system that is already proven to work and not required to trial-and-error on your own.
Is the Person Who Is Introducing You to the Opportunity Committed to Your Success?
If they are, the company is strong, and the product or service is a winner, then you will succeed. You will have to put the effort in to learn the systems and processes that make it work, but there's a big difference between a sponsor and a recruiter. A sponsor coaches, motivates, and trains while a recruiter simply signs people up and, in most cases, abandons them once their commission is collected.
Is There a Way to Build Your Business Part-Time Without Losing Your Full-Time Income?
The company must have automated systems that can do the heavy lifting, like the selling and sorting, for you so that you can use your limited time efficiently. Being able to build your business part-time while keeping your full-time income is the least risky way to transition to a new source of revenue.
Will You Have Fun?
It's important to keep this in mind. You should have fun with your business partners while you work together to build a long-term business. You will have to work at this to make it a success. With the right network marketing opportunity, it is achievable.