Creating Long Term Financial Success
Part 2 – A Business for Yourself, Not By Yourself
This is actually the second post in a series of 5 to cover the topic creating long term financial success. I think you'll find this series very timely. In the last post I started off by exploring the question, "Are You Involved in Marketing?"
And here's one of my favorite MLM statistics. . .
As we discovered the answer to that question was yes we are. Whether we worked for a Ford assembly plant or were a pharmacist; whether we were a plumber, dentist or lawyer, we sell our time or skill for money.
As I concluded last time I do believe there's a better way.
That business model is Network Marketing.
What differentiates Network Marketing from Retail or Direct sales is that in Network Marketing you're in business for yourself but NOT BY YOURSELF.
By being in business for yourself, especially if you're operating out of your home you're entitled to some substantial tax breaks.
By being in business for yourself you're buying the products at wholesale form the company you represent and you can use these items for your own consumption at a reduced price.
In fact that's exactly why I, as well as many others got involved in the first place. I was actually a product user for 2 years before I considered building this as a profession. I could turn around and sell the products at retail if I wanted to but I don't want to be a sales person.
That's why I didn't study marketing in college and studied pharmacy instead. I already worked in the financial services industry where my salary was based on a commission for a sale. I did that for a few years and I didn't like waking up every morning having to start the process all over again.
Like me 95% of the people have a negative thought in mind when they here the word "selling" yet we do it every day when we trade our time and talent for money.
As far as Network Marketing, did you know you already network market in your daily life?
Every time you share a great movie with someone or tell someone about a great new restaurant or even about some cool product you purchased you're network marketing. When your friends go to that restaurant or buy that product, you sold them by sharing with them, but you didn't get paid.
In Network Marketing you share the principles behind the business model and you sponsor people into the organization. They become purchasers of the product and you get paid. They then share it with others and guess what? You get paid again.
Along the way there'll be people that decide that Network Marketing isn't for them but even some of them will become customers of the product as well, and you still get paid.
Let's take a look at how this works but first I want to share some statistics about the industry.
- Did you know that more than 56 million people are running MLM businesses in over 100 countries around the world 13.3 million people in the US alone)?
- In 2008, network marketing companies earned over $100 billion in sales.
- Almost 80% of MLM representatives are females.
And here's one of my favorite MLM statistics. . .
- The network marketing industry has grown by 90% globally in the last ten years.
Can you think of any other industries that can say the same? Do you wonder why network marketing, which holds such a bad reputation, is seeing that much growth?
Network Marketing, 'MLM', and Multi Level Marketing are all terms that refer to the same type of business model, for the rest of this discussion I'll use the term "Network Marketing". While many close-minded people outside the industry (and others who've tried it and failed), have biased or negative wrong impressions, and despite the fact that it is used and abused by many crooks and con-artists, this business model has exceptional performance potential.
There are bad apples in every bunch, and this industry has more than it's share and I ran into one early on. But it can produce outstanding results if you know how to find the right company. And to maximize your potential, there are a few simple concepts whose understanding is critical to your success.
Unlike a franchises or conventional businesses, Network Marketing is the only business model that takes advantage of all three of the important, yet misunderstood principles of long term financial success.
The three principles are:
- Passive Residual Income
- Leverage (of Time and Money)
- Duplicability or Geometric Growth
In fact it's because of these principles, Robert Kiyosaki, the author of Rich Dad Poor Dad, states that Network Marketing is the Business of the 21st century (take a look at my website http://PlanBForSuccess.com to see what Robert Kiyosaki says about network marketing). The business model that will help people move from being on the left side of his cash flow quadrant, Employees and Self Employed (that is working for a check) to the right side of the cash flow quadrant, the business owner and investor, where other people earn the income for you.
The combination of all three of these elements is what gives the Network Marketing business model its synergy and exceptional performance potential. In fact one outstanding company I'm aware of has actually designed synergy into their business model with a minimal investment of time and money!
Whether it's a franchise or conventional business, both require major investments of time and money, and special skills if you hope to be really successful. Even with the relatively small percentage who achieves true success, it usually takes them years just to break even.
On the other hand, with the advent and popularity of the Internet and the rampant quest to "Get Rich Quick for Doing Nothing", many people have gotten all excited about affiliate, associate, referral, or co-op programs as they are sometimes called. But very few of the thousands of these being promoted have any real chance of making any significant money for the vast majority of people who get involved. In fact one of these programs where recently shut down by the government and are being investigated for running a Ponzi Scheme. To be a true network marketing business there must be a product or service sold.
There is a much better way to achieve your dreams!
But you have to:
1) Take the time to understand these three critical principles - PASSIVE RESIDUAL INCOME - LEVERAGE - GEOMETRIC GROWTH
Then . . .
2) LEARN TO ASK THREE SIMPLE QUESTIONS! - so you can teach what you know to others.
If you're even moderately successful in networking, you undoubtedly understand and believe in the three principles above. If you haven't yet had the success you desire, you may not completely understand these principles, or how to get them across to others.
Highly successful networkers have learned how to ask the right questions, then help others understand and take advantage of these important and powerful concepts.
Unfortunately these principles are not well understood by the majority of the population. And that's just one reason why so many fail at network marketing. There are lots of other reasons, and it would take a book to cover them all. But this is one of the more common ones. Because if you don't understand or believe in these principles, it's impossible to help others fully comprehend and appreciate them.
Let's face it, our educational system trains (or brainwashes) us to be conformists, to do what others tell us to do, and to prepare for a JOB, not an entrepreneurial business opportunity. So those of us, who crave our independence and freedom, head in the entrepreneurial direction in spite of our education, rarely because of it.
And even though many people claim they'd like to be their own boss or own their own business, only a small percentage of the population possess the necessary desire for success to risk stepping out of their 'comfort zones' to pursue their dreams.
Most people are afraid of failure, and for them it may be better and easier to live life in a rut. Others are satisfied or even happy with their jobs, incomes, or lifestyles, and that's great for them. But if you're one of millions who yearn for more freedom and control in your life, you must understand the following three principles to achieve True Financial Success.
On my next post we'll get into how powerful passive residual income, leverage, and geometric growth can be when it comes to long term financial security.