Turning a Profit in MLM
by Rich Niccolls
Everyone always wants to know how quickly they can be into profit when they start their MLM business. There are so many false expectations. Before we get into the answer to this question, do a little homework first on what it takes to be a business owner. Go on the Internet and find the phone numbers for such franchises as Subway, McDonalds, GNC, or a Verizon Wireless store. Call them up and ask how many weeks, months, or years it should take to turn a profit on your investment. I guarantee you that you will not get an answer for less than 2 years. Many will be 3 - 4 years.
If you don't like franchises, ask some friends who have their own construction business, nail salon, or convenient store. The answer will be the same.
I realize Network Marketing is different. But, for some reason we tend to get all wierd in the head when we think we should be in profit by the end of the week. And if we're not, then we get all bent out of shape and think our sponsor or company is to blame.
A recent poll conducted on a high traffic home business blog revealed the following results when asked how fast you should be able to turn a profit in MLM. Here are the results:
1 Month = 25%
2-3 Months = 44%
3-12 Months = 19%
12-24 MOnths = 15%
2-3 Years = 0%
Basically, over two-thirds of those polled believe they should turn a profit in 3 months or less. The reality, I believe, is that less than 10% do in that time frame. We hear about the big-time MLMers who join a company and BOOM, they are into profit before the end of the week (it may have something to do with the fact that they bring dozens of new recruits with them). For the average networker though (that is for about 95% of us), we should be thinking about the 3-12 month category.
Starting a new MLM business is different than opening a new Subway franchise. It isn't going to take 2-3 years to turn a profit. But, you would be MUCH better off having the mindset that it is going to take 3-12 months to profit. Work the first 1-5 months to cover the cost of your monthly autoship product (generally around $100) and the cost of marketing or buying leads (generally around $100-$200 per month). When your residual income exceeds the cost of your autoship and marketing (about $300), you're into profit. Of course, this does not even consider recovering your initial investment.
You will always hear the story of someone who did it quick, or some waitress who was an overnight success. That's great, but that probably isn't your story. I actally like the story better that says, "I joined my company in January, and after working my business for 6 months, I was able to get my income up to $400 per month. I kept sticking with it, and by the end of the year I was able to get things up to $1,000." I prefer the perseverance story over the overnight success story almost every time.
The main thing is... be realistic. Don't give up. Understand this is business. The quicker you turn a profit the better, but don't quit and blame the industry because you didn't make it to Diamond or Presidential status by the end of the first quarter. Have fun, enjoy your business, and create your story.
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