“Wait a minute, did you even hear that right? Isn't network marketing something like MLM? Is that even legal? Even worse, it could be something like a pyramid scheme for all we know. That headline is obviously a clickbait, right?”
In this article, I would like to address the misconceptions and myths around network marketing, and why as a flourishing industry itself, you can potentially glean some benefits from being associated with network marketing as being part of it, rather than just throwing shit at it from the outside.
Is it good to work in network marketing
The question on your mind is, after finding out that it's a legal way to earn some passive income, whether people are able to make money from it.
- According to Fundera's MLM Statistics for 2020, the MLM industry grossed 35.4 billion in 2018, and only 25% of its participants turned a profit. That's 1 in 4 persons, mind you, which is not too shabby if I may add.
- CNN Money listed 39 jobs where women actually make more than men — topping the list are women in sales, making 43 percent more than men.
I'm not saying, “Quit your job and join this business.” No, but instead, if you are looking for a form of passive income and don't mind putting in the hard work for five years at least, on top of your current job... maybe you can do your research into direct selling companies and join one. After all, about 1 in 13 American adults have participated in network marketing. Who knows if you might be one of them earning a steady passive income from it down the future?
Who is the top network marketing company
Some top network marketing companies include Amway and Herbalife which made 8.5 billion dollars and 5.5 billion dollars respectively in annual revenue in 2020.
One thing network marketing is not is that its easy money or a get-rich-quick scheme.
When I first joined a network marketing team, the leader told all of us it will be a 5-year journey at the very least, provided we put in some form of consistent work for 2 hours every single night after work. My experience with them was for a year and I did not continue because my mentor who had been earning some form of passive income from it already, suddenly quit the business.
But the takeaways from joining were precious, as I met a circle of ambitious, hardworking, and ethical business people who taught me that people were more important than money and that having dreams and goals are important. The business team and culture inculcated in me good values that made me a better human being- as a daughter, sibling, friend, and colleague.
For example, one of the tasks we as a business partner had to do was to read a self-improvement book for 20 minutes every night (can be borrowed from the library if you don't want to purchase it) and listen to business audio and update your mentor your thoughts and learnings that you gained every single day.
There was no force buying or selling. I wasn't pressured to buy into products. I bought them willingly after learning more about the science behind the products. The company was into FMCG products and services, so it was something I used every day, like shampoo and toothpaste, laundry powder, and other household cleaning products. There was also a skincare line and cosmetics line for the ladies.
And of course, I didn't manage to build it to a level that could bring a passive income stream, but it was an experience that led me to a group of like-minded people like myself, who earnestly believe in the business and want to continue its founder's legacy.
Now, even though I have left the business, I am still a user of the products, and the quality of its products leaves me as a continuing satisfied user. I guess that's how network marketing companies continue to make their money after recruiting their representatives. You leave, but you still patronize its business.
Recently, another acquaintance from another direct selling company approached me to try their wellness products. I learned of her story behind transitioning to doing this full-time and it's similar to the short-lived journey I had. I would like to share it with you all here.
She had tried the company's products in her forties when she was looking to regain her cholesterol levels to normal and lose some weight. Her success with the products led her to share with her friends and colleagues the benefits. She was doing this while having a full-time job at the same time.
When her passive income earnings started becoming higher than her full-time job salary, and as she really hated her job environment because of her boss, she quit and started doing this full-time. She enjoyed the supportive and nurturing environment that she gets as an independent business owner in the company and is now looking to bring her passive income to five figures. She is now in her fifties and is passionate about her life and where it brings her.
Is there any future in network marketing
Let's address whether network marketing or commonly referred to as direct sales or MLM is a form of pyramid scheme. Network marketing is a strategy that uses people to sell products or services directly to their peers or to recruit new people to act as salespeople for its products or services. A pyramid scheme, however, is driven by the recruitment of individuals to earn money instead of sales from products and services, and yes, a pyramid scheme is illegal.
In June 2000, the Singapore Parliament approved an amendment to the Act to widen the definition of pyramid selling to catch all business schemes that were multi-level in nature. However, as not all multi-level marketing techniques are undesirable, the Government concurrently enacted the Multi-Level Marketing and Pyramid Selling (Excluded Schemes and Arrangements) Order (which is also called the 'Exclusion Order') to exclude legitimate businesses from the Act, such as direct selling companies which fulfill certain criteria.
Hence, not all network marketing or MLM companies are pyramid schemes, and some are legal business entities that make billions of dollars annually through their sales of products and services.