Network Marketing - the good, the bad, the ugly

Mention "Network Marketing" or "MLM" and some people will just shut down as they mumble something about "Amway". On the other hand, others respond VERY positively. Last week I mentioned Network Marketing to a friend, and she told me her parents still receive a risidual income of over $10,000 per month from a 10 year old supplement company they particapted in, and they and their family still buys products from.

So the responses range wildly and widely. But the fact is that Amway was primarily in the news in the 1970's when the FTC came down with a 1976 decision on their practice of making money off their motivational & instructional materials rather than their consumer products.

Author Richard Poe wrote a book in the '90s called "Wave Three: The New Era of Networking Marketing" in which he described the evolution from really bad implementations that deservedly earned bad reputations, to what Network Marketing has become. And here we are nearing the end of 2006 and Richard Poe is saying there is even a Fourth Wave.

Two key differences between bad and good MLM's are that 1) bad ones have high "entrance fees", and 2) Distributors are forced to purchase expensive inventories. When they can't sell them, the MLM collapses and everyone but those at the top lose money.

So look for companies with a low Distributor fee, where you are NEVER required to buy ANY other promotional material, and the product pamphlets, and there is a lot of information on the internet that is ALL free. Secondly, if you want inventory for Retails sales you can stock up, but you don't have to sell that way. You can just get people to sign up for their own auto-shipment, or place orders as recieved and mailed directly to the customer.

Also choose one where you can stop auto-shipment at any time, and start up your "business" again at any time. The old bad ways are gone from Network Marketing - at least in the good companies. Besides... you can choose to just drink one of the fantastic juices sold via MLM and not sell it yourself.