On Network Marketing and Multi Level Marketing

For most of us Filipinos, network marketing or multilevel marketing is a new business format that boggles many minds. As a concept, network marketing has been touted as the fastest way to accumulate wealth nowadays. The concept is used to penetrate the market as fast as possible without entailing expensive marketing costs such as marketing and promotions.

For the most part, network marketing is spread by word-of-mouth. You most likely have to be invited to join a business orientation or a seminar.

Network marketing is a nontraditional business with unconventional results. But yes, it is a business!

In recent years, several multi level marketing systems and direct selling groups have cropped up in the Philippines. They are the likes of Avon, First Quadrant, Forever Living, AIM Global, Fern-C, First Vita Plus, UNO, Herbalife, Mary Kay Cosmetics, My Benefits Club, NuSkin, USANA, and the world’s pioneer and oldest network marketing organization – Amway.

For a product distributorship business, the initial joining fee is minimal; it can range to Php 250 to around Php 20,000. In return, they give you a business license or membership to operate the business. Some network marketing groups give you product samples and a business kit with documents and brochures. However, the business does not end there.

Many of us have joined network marketing groups and after a while quit or do not renew their license and proclaim that it was a no good group. Oftentimes, many have expressed disappointments over the outcome when compared to their initial enthusiasm before joining the business.

In choosing your network marketing – which one to join?

There are basically four factors that you have to investigate before joining any network marketing or multi-level marketing group.

First, what are the products? Are they of good quality? Are there a variety of products that you can buy for personal consumption or retail to your customers? Some groups have single products such as a health juice, prepaid cards, or a website. The same goes if they only have one product line such as food supplements only, or just cosmetics. The choice is too limited.

Second, what is the company background? Will they be around for the long haul? Who are the company owners? Just as you choose which bank to put your money in, you also have to look into the networking company that you intend to join. It must be as stable as a bank, with an impeccable worldwide or local business.

Third, what is their compensation plan? Is it equitable?

Lastly, what kind of training and support will you get to be able to succeed in network marketing business? You need to be educated in the business.

Are they providing seminars to learn about their products? Also, you may want to know what continuing training programs they have to sustain your business and increase your profits.

There are more questions you can ask on your sponsor for the network marketing or multi level marketing business that you intend to join.

As a rule of thumb, a good network marketing group is structured in a way that:

It does not force you to stock up on their inventory and allows you to return goods that you bought from them. It must provide a buyer’s remorse clause that allows its members to return products that they bought, in effect, providing a full satisfaction, money-back guarantee.

There should not be any front-loading of products. Front loading happens when you are forced to buy products just to join the group. A few samples in the business or a joining kit are acceptable. Watch out though as some groups camouflage front-loading by saying the kit includes “many” product samples that are included in their substantial joining fee.

Still, other groups “require” you to continually buy products to retain active membership status. Otherwise, they delete you from the roster of members. In this case, I think, this is not a good network marketing practice.

It does not pay a substantial commission for recruiting members. The normal practice for network marketing companies is between 5 to 10% of the joining fee. Otherwise, if the recruiting fee commission is quite big the members will tend to focus on recruitment alone just so they can make a fast buck. It would be better if commissions are only paid when a product is sold, and not on the recruitment or joining fee.

I’ve compiled a list of 25 Questions to Ask Your Sponsor in MLM. You may want to take a look at it before joining that network company you’re eyeing for. It would definitely help you stream line the various network marketing choices that you have.

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Tyrone is a passionate financial literacy advocate. He started this blog on November 2008 when he watched The Secret which talked about Law of Attraction because he wanted to become a millionaire and wanted to know how a millionaire acts. At the age of 26, he achieved his first million. To find out more about him, click here or follow him at Instagram

16 responses on “On Network Marketing and Multi Level Marketing

  1. a good and very timely post Ty.
    btw just to add…some reality check questions you have to ask yourself before you seriously engage into this type of business, specially when you’re starting out;

    *Do you like the product involve and willing to use it for a long time, or be a testament to it?

    *How long is your network of friends, relatives, w/c you think can be interested in your product or business?

    *How much time are you willing to give into this each day? can you give it much time?(coz that time will be spent calling and meeting new people for prospects/downlines, & eventually your initial list will be cut short)

    *Is there a lot people in your area or company/network of people that are already into this too?(because they can be your competitor and your area can be saturated and lessen the chances of you getting more people)

    hope this helps (“,)

  2. Thanks Chard for the comment. I will post an article tomorrow entitled “25 questions to ask in joining network marketing” and some of the questions you’ve raised above in your comment are included in those set of 25 questions. (“,)

    How’s your MLM business doing?

    • you are right but not get find the best company you choose , you know why 95% fail ?if you want to find MLM
      1 choose company
      2 Marketing plan (charity, simple, fair , )
      3 Finnacial sale statement
      4 Products
      5 Learn more never give up

  3. Network marketing is a big business. Many people are still in doubt if network marketing realy works as a profitable business. There are things to consider in network markeintg. But It is a nice business opportunity for everyone..

  4. I love MLM business, its nice to meet new friends… I invest time and money on a MLM business some of them are already close and some are scums. It’s so disappointing but still I’m ready to join new MLM company. DLCorp founded by Eddy Chai. Its coming this year 2009 here in Philippines.

  5. Network Marketing is the fastest way to learn business because of ready made system. And it is not surprising that you need to build network of people in building successful business. Just like Robert Kiyosaki had quote: Rich people build networks, while everyone look for work.

  6. I plan to attend a first vita plus seminar but while i am browsing the internet, I read that the owner of vita plus is the same with first quadrant. I heard negative reports about the first quadrant, di ba wala na po itong kompanyang ito?

    How do I treat this information?

    • binary po ang 1st quadrant ganun din po ang vitaplus kaya mabibilis magsara..,check nyo po sa DSAP kung member sila kasi ang DSAP ay kampanya laban sa pyramiding scams o binary…kaya kung member sila dun ibig sabihin legal sila…try nio po DXN international private limited…legitimong company po kami…thankyou poh…

    • First quadrant and First Vitaplus has the same owner.
      First Quadrant wasn’t a successful one because it’s marketing plan is weak.
      First Vitaplus was conceived when the owner got sick. (I’m assuming, because of all the stresses she got from First Quadrant. ) The owner met Dr. Galvez Tan (http://www.doh.gov.ph/node/1282.html) who has the formula of the 5 power herbs and the rest is history.

  7. How about ALLIANCE AIM GLOBAL maganda namn ang mga product nila at nahalal pa na superbrands from 2014-2016 at pumasok sa guinnes world record!! Anu po ang masasabi nu tungkol dito? Salamat po!

  8. Sa nagsasabi pong binary ang vita plus yes it’s binary pero hindi po kagaya ng ibang binary kasi po yung ibang binary kaya nadala ang mga tao at napaso na sila yun po yung tinatawag na perfect binary eh mahihirapan ka talaga pag perfect binary kasi kailangan mong ma perfect yung triangle eh pero sa vita plus po hindi po ganun kahit anong itsura ng kaliwa mo ano mang itsura ng kanan mo may cheke ka pa din tawag po is head count lang ang vita plus po is not a perfect binary….thank you and god bless …..

    .PoweR proud fvp dealer

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