How many MLM companies can I join? by John Counsel

This article appeared in the February 1999 issue of Upline®

It can be hard to resist great products and lucrative reward plans. But join too many and it’s not just your bank balance that suffers. Your credibility and self- esteem can take a battering, too. It’s less a case of “how many MLM companies can you join?” than of “how many MLM companies should you join?

In this column we’re going to examine a better way to enjoy all the benefits of belonging to several MLM companies by belonging to only one company (and it really doesn’t matter which one!)

Why most of us join more than one MLM company

Products sold through MLM are generally the best in their field. They have to be, for two very good reasons:

1. They usually come with a 100% money-back guarantee of satisfaction. No company wants to give that kind of wide-open guarantee to a dud product! (Not if it wants to stay in business.)
    
2. They have to be sold by part-time, inexperienced agents in a sceptical market place, so the products have to be good enough to sell themselves.

Because they have to compete with other products, MLM products usually offer some kind of price advantage, even if that advantage isn’t immediately obvious to the consumer (another reason they need selling).

All this makes them very attractive to us as consumers.

Add to these attractions the income opportunity offered by becoming an agent, and few of us can resist the temptation to sign up, even if it’s just to get our products at wholesale prices.

Beware… it’s a trap!

The problem is, if you belong to more than one company, it becomes very difficult to build any of them effectively. Your efforts are split in too many directions, and you end up confusing your people downline, dissipating your strength, and worrying about your integrity, credibility and sanity — with good reason.

The reality of joining a whole raft of MLM businesses is that most of us do it to save money. We don’t intend building a business. We just want to get those great products at wholesale.
But, by the time you place your order — often at long-distance phone rates — then pay the freight (because your order is below the company’s freight-free limit), you’ve wiped out most of the savings and wasted a lot of time and effort into the bargain.

The cold, hard reality is that most “consumer-agents” drop out after the first year or two for these very reasons.

As for your own retail customers, they’re never sure quite what you’re trying to sell them, and many become so confused or intimidated by the range of products you sell, that they actually buy less and less. Remember — most MLM customers will regard your products as extras on top of their regular household expenditure! (Right or wrong, that’s the way they see it and it’s almost impossible to change that perception.)

So it all becomes pretty self-defeating. The growing trend to recruiting consumers rather than retailers only makes this pattern worse in the long run. The short-sighted attitude that sees the answer to “fear of selling” as being to remove the selling rather than the fear means that the fear is still there!

Is there an answer?

As usual, there is. And, as usual, it’s so glaringly obvious and such good, common sense that we all seem to miss it!

Consider the situation for a moment.

• You want to enjoy the benefits of using excellent MLM products.
   
• You want to save money.
   
• If possible, you want to earn some money as well.
   
• You don’t have the time or resources to run more than one MLM business successfully.
   
• You don’t want to confuse, distract or frighten agents in your primary MLM business by introducing them to new ones.
   
• Practically everyone you can think of is already involved in MLM.

The simple solution

Here’s how you can solve all of these problems and enjoy the product benefits, higher savings and increased income, without threat to your primary MLM business and without having to worry about trying to recruit people from other companies. Your integrity, credibility and sanity won’t suffer , either!

1. Decide which other MLM products you want to be able to use, and which MLM companies sell them. Make a list.
    
2. Get in touch with the nearest agent from each company. (If necessary, contact the companies’ head offices and ask them to put their nearest active agents in touch with you.) Ask each agent to come and see you, with products, literature and price lists. Tell them you’re only interested in becoming a retail customer, not an agent or “consumer member” (or similar name).
    
3. Explain that you’re an agent for your particular company, and that you’d like to show them some of your own product range with a view to them becoming a customer for your products. Be sure to impress on them that you’re not trying to sponsor them into your organisation. Just as you’re impressed by their products and want to enjoy the benefits they offer, you believe they’ll be impressed by your company’s products. Offer them a free trial, if that’s feasible.
    
4. Depending on the nature of your products, and the products you want to use, contact nearby agents from all of the companies on your list and do a similar deal. You become their customer, they become your customers.

Simple.

But how does it solve all those problems we spoke about earlier? And how does it deliver all those benefits?

1. Savings

If you’re going to pay full retail prices on these items, how on earth will you save anything?
Well, for a start, you save the cost of registration as an agent. This year. Next year. The year after… and on it goes.

Assuming that the average registration or renewal is around $25, and you’re dealing with, say, six companies, you’ve just saved $150 a year — and remember, those fees were just for the right to purchase at wholesale!

If your average monthly retail purchase is, say, $20 per company, and the industry average commission is around 25%, you’d have saved around $5 per month per company as a “consumer member”. That’s about $60 a year in savings you’re missing out on. Deduct from that the $25 average renewal and and you’ve only “lost” $35 a year per company in wholesale savings. Multiplied by six companies, that’s a total “loss” of savings of $200 or so each year.
Before you begin griping, though, look at all the facts and figures. By the way, notice that we haven’t discussed the cost of your Starter Kit in these amounts? They’re a major factor, even though they’re not a recurring expense, because most people drop out in that first year anyway!

Let’s say the average Starter Kit is $50, and that $20 of that is literature you’ll probably never use. That’s $120 (6 companies x $20) wasted – minimum! Deduct around $20 in non-applicable commissions on the subsidised products in your kit (because they’re actually products you’ll use) and your real “loss” of savings is only around $50—$60 a year in total.

2. Earnings

You now have six new retail customers, each of whom is likely to continue buying regularly for the simple reason that they want to keep you as a retail customer, too.

Your average commissions will be around $5 per customer. Multiplied by six customers, that’s a total commission of around $30 per month – or $360 a year.

In other words, if you deduct the $50 or so that you “lost” in savings from the $360 you’ll earn in additional commissions, you have a net surplus of more than $300 for the year.

Compare that to the hypothetical “earnings” you’ll make as an agent for six companies (are you kidding?) and you’ll still be around $300 better off in reality!

But there’s more.

By joining and consuming, your regular purchases would fall below most companies’ minimum level for bonus qualification. (Let’s not kid ourselves that you’ll actually retail any products for more than one company. You’ll be so strapped for time you’ll be lucky to fit in sales for even one.)

By approaching things in this way, your personal sales volume is going to increase measurably in your own business. Teach your people to do the same thing and your group volume will climb substantially. And because your people will be selling to other MLMers, they’ll find it easier to persuade them of the product and saving benefits, without fear of your own people signing up willy-nilly in a dozen other companies!

Your bonuses will begin to climb, and your real income (not your hypothetical income) will do the same.

The net result is more money in everyone’s pocket – including your new customers! Teach them all to do what you’ve done (why not make the introductions?) and we can begin breaking down the artificial emotional barriers that are holding this industry back from achieving its true potential.

Let’s look at the Results…

• You’ll enjoy the product benefits.

• You’ll save real money by not having to pay for Starter Kits, literature, registrations or renewals for all those other companies.

• You’ll enjoy other savings, like not sitting in long-distance telephone queues, not paying freight on your deliveries (nor travelling to collect your orders).

• You’ll earn full retail commissions on the purchases of your new retail customers

• You can “trade off” your purchases against your sales with them without affecting your volume or bonuses, which means they’ll be more likely to buy from you (after all, they won’t want to miss out on the added volume, even if cash is a little tight that month).

• Your bonuses will increase, giving you extra income every month.

• Your own customers won’t become confused or intimidated by the different product ranges you’re trying to sell them.

• Your own MLM downline won’t become confused, distracted or disenchanted by your involvement in other companies (remember the First Law of MLM? “Your people will do what they see you do”).

• You’ll have the time and energy to focus on building just one business. You can focus clearly, enthusiastically and effectively.

• The fact that so many people already belong to one MLM business or another now becomes a genuine co-operative advantage… not an imagined competitive handicap!

It makes so much more sense to do business this way, doesn’t it?

Why not try it, perhaps with someone you already know from another MLM company, just to see if it works?

You’ll find it does. We’ve proven it, time and time again. We use products from more than a dozen MLM companies. And we trade off with most of those agents. A small number still feel too threatened emotionally to buy our own products… yet! But most of our colleagues from other companies are only too delighted to buy and sell with us and with each other. And we’re all prospering as a direct result.

There’s no room for the nonsensical, anti-productive, relationship-destroying “win-lose*” concept of competition in an industry that relies on win-win co-operation and the quality and durability of personal relationships for its success.

Every company has something to offer!

If we all bought and sold from each other, respecting each other’s chosen business involvements, without trying to convince each other of the superiority of our own, this industry would grow and prosper beyond our present ability to imagine it.

Never forget – the emotional insecurity that impells us to try to “prove” the superiority of our personal choice of MLM business is the same emotional dependence that impells the other person to reject it (because it threatens them) and justify their own choice!

Mutual respect and co-operation are called for if we want a true win-win result.

© 1995 John Counsel. All rights reserved. No reproduction by any means permitted without prior written consent of the copyright owner. This article appeared originally in Australian Business & Money-Making Opportunities magazine.

  
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©1998 The Profit Clinic. All rights reserved. This page updated 10 August 2002