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How to Select a Network Marketing or Direct Selling Opportunity

May 17, 2010

With entrepreneurship being the fastest growing business trend world wide and more people looking for opportunities, multi-level marketing, network marketing and direct selling—or whatever new fangled term that describes this business model—are exploding in popularity.

Unfortunately, network marketing and direct sales have gotten an unfair bad rap.  These are lucrative industries with some very good opportunities and legitimate business models.  But dishonest people who have run ponzi or pyramid schemes have led some to believe that these kinds of businesses are rip-offs.  Also, some honest but unprofessional, not-so-savvy people who call their friends for “home parties,” “meetings,” “shows,” or “presentations” for a new company every month have tainted these kinds of businesses too.

I would encourage you, however, to not allow crooks and clowns to ruin what could be a big life-changer for you.  A network marketing or direct sales business system that works could enable you to make extra money, pay off debt, take advantage of business tax deductions, grow your other assets—and for the most ambitious network marketer or direct sales professional, these systems can even enable you to make a six-figure income, or better.

To help you vet opportunities being pitched to you or screen the ones you are seeking on your own, I have developed the following list of questions you should ask yourself or the individuals who are vying to sell you their business system:

  1. Is the company registered with the Direct Selling Association? The Direct Selling Association (DSA) has been in existence since 1910 and is a legitimate resource that works with companies, government agencies and consumers to make sure business opportunities are honestly marketed and that customers receive fair treatment. If a company is not registered with the DSA it does not mean the company is not legitimate but you should ask why they are not registered.  If a company is registered with the DSA it’s a good sign that they are around to stay. Check to see if the company you are considering is registered.
  2. Does the company offer regular ongoing training at no additional charge, or at a nominal and reasonable fee? The best network marketing and direct sales companies want their distributors to be successful so they will invest in training.  Those that are unwilling to train associates at no cost—or for a low cost—may be more interested in making fast cash up front versus building a vast network of properly trained, professional direct sales and networking marketing professionals.  If the company does not train it may not be legit, and even if it is it may not be around for long.
  3. Are the products and services something that people use, or would use, regularly; and are they competitively priced? If your friends, family and other people you meet are not using the products you are selling, think carefully about whether they would—and the reason for them doing so can’t simply be that they are related to you, know you or like you.  Some companies will try to convince you that this is your competitive angle. To be blunt: That’s a crock.  Buying stuff you don’t need, or buying in such a way that is inconvenient, may work for a while but that gets old and is not the makings of a sustainable business.  Also, if your products cost a lot more than the same product, or a similar one, elsewhere, then you will need a good reason and story that justify the higher price. And in today’s cost-conscious economy your reason and story may still not be good enough so you may also need to look for another opportunity.

These three questions are not necessarily a comprehensive analysis but at least answering them and carefully weighing the pros and cons will help you make a much better decision as to whether network marketing or direct sales is right for you—and which company to associate with if so.  The Direct Selling Association has also put together a complete website that answers more questions and addresses various myths you may hear about the industry. Check out Direct Selling 411.

    One Comment leave one →
    1. Patricia permalink
      May 19, 2010 6:56 pm

      I have an invention and I don’t know where to start trying to get it patented and made and marketed.Can you help me I need some true guidance.

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