MLM Profits: Who makes the Lions Share?
Read More: We probably have all done it. When we were searching for "next big thing" in opportunities, we wanted to choose a great company to be associated with.
So what impressed you the most? Were you wooed by new the new 75 million dollar office building with the most state of the art equipment and the 400 salaried employees on staff.
Your impression was that "now this company must be doing something right!"
The majority of us probably did not think, HMMM I wonder how they are paying for all of this. Wow, I wonder what the monthly interest payment is on a $75 Million building?
What about such things as maintenance, washing all those beautiful glass windows. Painting the parking lot, or the beautiful landscaping.
400 salaried employees? I wonder who pays for the workmans comp, or benefits for all the employees.
And 400 people, I wonder if they have to hire managers and assistant managers, to keep all the employees in line?
Or, maybe it was the private Island, or the private company jet that said to you "wow, this must be a successful company!"
Perhaps it was the paid celebrity product endorsements that impressed you enough to say, "this company is my vehicle of choice to financial freedom!"
Ok. Fair enough. It all looks wonderful. I looks as if the company has done well. But, herein lies the rub.
WHO GETS TO PAY FOR ALL THIS!!!!!
Brace yourself, how about Y-O-U!! Thats right YOU DO! "How is that?" you ask...
Well, how does the company make money? Its made by moving a product, right? It takes the revenue made on the product "moved through an army of distributors" subtract any expenses, leaves profit.
Would you say that the lions share of the profits are going to the field of distributors, or maybe towards that HUMONGOUS overhead.
Could that be why company Y must sell its widgets for $140.00 when company X sells the same widget for $40.
So given this common scenario, does the company really have the distributors best interest in mind when it carries excess "fat." The more "fat" a company has, the less it can put into the distributor comp plan.
Great! So how do I know if my company is overloaded with pork? My first response that question is how well do they pay the part timer?
Another suggestion is to start by crunching the numbers. How much money do you need to make a month to gain your freedom?Take that number and find out how many active downline it will take to produce that income number. Is your comp plan structured in such a manner to make attaining this number of distributors a realistic possibility? Assuming you retain a significant number of distributors, and don't lose them through attrition.
Well, thats great, so how do I learn to analyize a company to know if it is something I want to ba a part of?First, you can Google the company or the founder on the company in "quotation" marks. If there are any negatives on the company or Management, you will generally find it.
The next suggestion is see if it passes the 5 Pillar test. If it does, you can be assured that you have a winner!
So next time, you are looking for an opportunity, or if you are questioning your current one, take the time to see how "streamlined" they are. You just might be suprised where your bonus money goes.
Views: 400 | 
Comments: 8 
About the Author: Kevin Brake
Member Since: 10/23/2008
Industry: No Industry Selected
Primary Web Site: http://KevinPBrake.mentoringforfree.com
Kevin, Nice Article
There are so many clues to analyze BEFORE joining that next MLM. You have pointed out a couple of good red flags.
Unfortunately, what happens in a lot of instances, through no fault of their own, people walk into a "new, going-to-be-the-MLM-that-changes-my life" situation without really looking to see if the company actually has the 5 Pillars. I know because I have done the same thing.
It is funny that when you look at a "corporate J.O.B." you assess certain qualities of that company. I wonder why in joining an MLM a lot of people go in blindly believing everything they are told without checking all the facts first?
Thanks Kevin!
Wow!
There is so much truth to what you are saying!! That is why it is so important to be a part of a 5 pillar company! I am grateful to be on the more educated side of the coin when it comes to network marketing!
All the very best,
Alicia Bozza
Yes! If you will not take the time to Educate yourself about...
That could cost you 6 figures. Lets Say In your company it takes 2000 distributors to make $10,000 a month . IN My company with 2000 people I am makeing $60,000 a month. Is that your fault? Yes if you got educated and chose to do nothing about it. This essential Information will coast you $50,000 a month. So get Back with Kevin Folks and Educate yourself about your Comp Plan. and the other 5 pillars.
Your Friend for Life
Juanita Waterman
( I have found in Many Companies the numbers are around 2000 or more average to make $10,000 amonth do you home work)
Great article
Hi Kevin,
I can so relate to this article and am so glad I came across you guys via my mentor Juanita.
Great article
Your friend for life
David Atkinson
Education is the key
Hi Kevin, I have learnt so much since the information I got had educated me, understanding what to look for in a company is my first port of call, if it doesn't fit the 5 pillar principles I'm going the other way.
Look forward to more info
True Friendship
Bethune
Yeah Kevin!
My last company is a primo example of what your talking about, they even had an in house radar and weather tracking center, and windows that would turn into video screens! They had huge auditoriums, in house doctors and dentist, and a big gym! They are the biggest building in the city, and employ the most people in the county. A great place to work for sure, but who pays for all that? The money spent on quarterly stock reports equals almost a million a year in this publicly traded company!
The company I work with now has maybe a half dozen employees, and very little overhead, they use the internet for 95% of their business. The part timers benefit big time! I mean Really Big Time!
It Really Makes a Difference!
Wow Paul! What a contrast.
Great Article! I love Better Networker!
Ideas like this make you stop to think about how the corporate office does things! I appreciate my company because two of the co-founders were top networkers before starting the company. The company motto is "Representatives First" and they work hard to help us in the field. They even are available to come into the field to help areas build up. They recently as of last year moved into a new facility which houses our VOIP network ops center and the corporate offices, but they are looking towards the future because of the growth in the last 3 years!
PS Can some one help me with the "5 pillar" concept and send me some info? Thanks.