Did you know that successful network marketing companies depend on the presence of purchasers who buy the company’s products or services (and continue to do so) while they are making little or no money through the company’s income opportunity?
Each month, we receive many phone calls from people who are seeking to build network marketing or party plan companies.
During these calls, we often talk about the product or service to be sold. One of the questions we ask is, “Will people buy your products or services even if they are not making any money through your income opportunity?”
We explain that it’s really important that the product or service to be sold is purchased by non-participants in the income opportunity. Independent representatives of party plan companies by definition sell their products to retail customers, so this concern for them is a non-issue.
If yours is a network marketing company, however, be aware of the following facts:
1. You would like all of your independent representatives to make great money through your compensation plan.
2. However, the majority of representatives make little or no money on the sales volume of others through a company’s income opportunity.
3. Nonetheless, the independent representatives who are not making money through your income opportunity need to buy your products (and continue to do so).
4. Product differentiation, product benefits, product and brand loyalties, and engaging customer experiences can each help to increase retention.
5. Legally speaking, we recommend that your products and services are sold to as many non-participants in the income opportunity as possible. Here, I am talking about customers.
6. If no one will buy your products unless they are making money through your compensation plan, your long-term business success and legal survival are in danger!
Now that you’ve taken the Survival Test, can you say that your business is in excellent shape?
For help to strengthen your business, contact Jay at Sylvina Consulting at 503.244.8787 or by email, jay@sylvina.com.
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