There are several business principles, which you can leverage on as a MLM business owner. MLM combines the best business principles out there. Many newcomers to network marketing don’t realise it, but MLM business principles are based on solid mainstream business practices, all of which have been proven over and over again over hundreds of years.

Allow me to explain:

“Normal” businesses apply a number of strategies to grow and sustain their revenue. They focus on keeping their expenses as low as possible, while keeping their profit margins and revenue as high as possible. They use techniques that include outsourcing, franchising, drop shipping, and selling items that require regular replacement.

How MLM Combines the Best Business Principles from Franchising:

  1. Your network marketing opportunity is similar in concept to a franchise business model. You may use the MLM company name and branding. Also, MLM companies supply you with an existing product line to sell. Fellow entrepreneurs also give you support. Meanwhile, MLM gives you a business model that works. With this strategy, you own your products, make profits, and become a better network marketer. The only difference is that the cost you must incur is less. You will pay a lot less than the person opening a franchise on Main Street. Fair enough, the person who paid a lot of money may make bigger money sooner. However, they will still have to pay back the loan they took out to get started. Simply put, you do not need to necessarily take a loan to start your network marketing business. Get the products, own them, and make some sales.
  1. Both business models apply the principle of leverage. However, instead of outsourcing, you actually empower others to become partners in your venture. And just like a normal partnership, your success depends on theirs, so you will do whatever you can to ensure their success. Network marketing offers people the opportunity to recruit people into their business, not as a employee, but as a business owners. You do not recruit prospects in network marketing as employees, but as partners, and business owner.
  2. Just like a main street operation, MLM business offers you a system that keeps your expenses as low as possible. The fact that you do not have to stock any products/inventory, rent office and/or storage space, and pay your staff a salary, means that your chances of success are that much higher.

Recommended Read: How to Explain MLM Business to Someone Who Never Heard About It Before?

How MLM Combines the Best Business Principles from Dropshipping

This is similar to what many dropship suppliers do. They start off their businesses without any inventory, staff or other overheads. The difference is that those dropshippers have to find and source their own products, and doing that takes a lot of time and effort.

In MLM, the company takes care of almost everything. All you have to do is to take care of the marketing side. Then you need to push hard until it starts to pay off.

Just like any brick and mortar business, your MLM venture will reward you with higher profits as you grow. In other businesses, you achieve this by being able to buy larger quantities of stock at a time, resulting in lower price and higher profit margins. In a multi-level marketing company, you systematically grow into higher levels, which pay higher commissions.

Conclusions

The business principles of MLM and main street ventures are exactly the same, the same model, and structure. In fact, your network marketing business combines all of the best, proven business practices to offer you the best possible chance of success.

The ONLY difference for you is the way in which the products or services are marketed. In network marketing, the customer has the opportunity to become a business partner.

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