Perhaps the cost of buying into a franchise is too much for you. Then you might want to try network marketing. Typically when joining a network marketing company, you buy a starter kit that contains training and advertising materials, often for as little as $200.
Why so cheap? Partly because of low overhead. Network marketing is commonly conducted by word of mouth, though some organizations are currently expanding through the Internet, direct mail, and telemarketing. Typically a distributor, also known as a marketer, buys a product from the network marketing company, sells it to customers and earns a commission, usually at least 25 percent.
The distributor also recruits or sponsors other distributors, for which he or she receives ongoing compensation under one of a variety of compensation plans which vary from company to company. Network marketing's direct distribution channel attracts customers by keeping prices lower than in the traditional retailing business system.
The benefits of network marketing can be enormous. In addition to comprehensive training and minimal start-up costs, this method of doing business offers you the choice of either full- or part-time work, and the option of working at home. You take on minimal risk while working for a reputable national or international business. By recruiting downline distributors to earn passive income for you, you free up your time and simultaneously take control of your financial future. Network marketing can give you precious experience in running a small business as well as the opportunity to develop communications and leadership skills. Automated order processing, distribution and accounting systems prevent many of the headaches associated with traditional start-ups. Most important of all, network marketing gives you the chance to invest your money with pre-tax dollars because you are operating a business, making you much more money in the long run.
EVALUATING YOURSELF-AND THE NETWORK MARKETING COMPANY
Are you right for network marketing? Many of the traits that make for a good franchisee also make for a good network marketer. You'll need to be:
? Courageous. Moral support may be hard to come by at first.
? Receptive. Can you take advice from people more experienced than you?
? Congenial. You should concentrate on training and developing people rather than making money-the profits will follow later.
? Passionate and communicative. Products don't sell themselves; people sell products-and in the case of network marketing, business opportunities-by communicating with passion.
? Persistent. Rome wasn't built in a day, and network marketing isn't for get-rich-quick wannabes.
? Self-disciplined. Though you'll probably have a mentor to guide you, you'll still have to set up a daily routine for doing business and stick with it.
? Able to deal with rejection. A network marketer must learn to accept rejection and move on.
PYRAMID SCHEMES AND OTHER MONKEY BUSINESS
Before committing yourself to a particular company, you should take the time to evaluate it. Network marketing has gotten a bad rap because of pyramid schemes. Pyramids, which exist solely for the purpose of signing up recruits, are illegal in many states, and the pall of suspicion they have cast over network marketing as a whole is unfortunate, considering how many network companies are honest operations.
Start your assessment by asking whether the company's product or service is legitimate. You can call your local Better Business Bureau to see if complaints have been filed. Don't rely on the spiel of one of the company's super salespeople. Instead, ask that person for a copy of a monthly sales report, or better yet, talk with unbiased folks who have had dealings with the company but who won't be selling to you. As with franchises, beware of breathless pitches in the mail, over the phone, or in small-business magazines that promise you quick profits with no experience required. These may be generated by ghost companies trying to sell you information about bogus business opportunities.
Remember, in selecting a network marketing company, your best bet is to look for a good training program, satisfied distributors, a well-oiled distribution system, and a compensation plan
that has been successful for years.
Next, ask whether the company offers strong, ongoing educational programs and a sound mentoring system. Regularly attend company meetings (ideally, you'll comparison shop by attending meetings of other networking outfits as well). Learn about the organization's systems and compensation plans. Get to know the distributors. Do you respect and enjoy being with the people who work for this company? Your best bet is to select a business with a good training program, satisfied distributors, a well-oiled distribution system, and a compensation plan that has been successful for years. Once the company meets all these criteria, then ask yourself whether the company's product or service is one you believe in and can share confidently with others. If, after all this legwork, you're convinced that you've found a business with a track record that also sells something you can stand behind, then you've laid a solid foundation for future financial independence.
LAUNCHING YOURSELF IN NETWORK MARKETING
It sounds so simple: You sign a distributor agreement, receive a starter kit, order some products, and you're ready to roll! It is not that easy. Just as with any business, there are details to attend to. Among the most important:
? Deciding on the legal form of ownership. Will your business be a sole proprietorship, partnership, C corporation, limited-liability company, or S corporation?
? Choosing a company name. You probably won't be allowed to use the network company's name as your own.
? Selecting marketing materials. These may include business cards, stationery with your letterhead, presentation folders, catalogs, and direct mailers.
? Meeting zoning requirements. Even if you're a home-based business, you'll have to find out whether there are zoning restrictions on your activity.
? Obtaining a local and perhaps a state business license.
? Figuring out how to pay taxes. C corporations pay income taxes directly, but sole proprietorships, partnerships, certain LLCs, and S corporations pay income taxes as part of the owner's personal income-meaning the appropriate amount from each check should be deposited in a separate account and paid to the IRS quarterly.
? Deciding who will do your bookkeeping. Will it be you, or a bookkeeping or accounting firm? Handling your own books, at least in the beginning, will teach invaluable lessons about managing cash flow, keeping tax records, and budgeting.
Once you've chosen the business you want to pursue, find a mentor whom you can call to get help.
APPROACH BUSINESS AS A TEAM SPORT
Some people insist on doing their own tax planning and legal work to save money. What they're really doing is ignoring their businesses. While they may save money in the short run, the eventual cost of not paying advisors will be much larger. If you really want to succeed in business, you can't go it alone. No one who is successful ever does. When you do decide to put together a team, remember there is truth in the adage "You get what you pay for." Free advice is usually worth exactly what you pay for it-nothing. You should consider paying the professionals on your team well. Why? Because if those people use their specialized knowledge to support you, they'll make more money for you.
It doesn't pay to scrimp. If the people you hire for your team use their specialized knowledge to support you, they should make you money. The more money they make, the more money you will.
Putting together a good team will require effort as well as money. Look at it as effort well spent. There are plenty of professionals-lawyers, accountants, tax planners, and the like-who will claim they can help you, and maybe they can. But you're looking for more than that advisor. You want their support, their encouragement, and their respect. What you don't want is someone telling you that you aren't capable of doing something when you know deep down that you are. You want to explain your goal and have professionals help you get there. The good professional will identify the risks, know how to minimize them, and ensure that the route you take doesn't inadvertently run afoul of some law. Hire professionals who will support your goals, not question them.
Take look at some of the business opportunities in the recommended links. All are a solid business. You can only fail when you do not work the system and when you give up. Doing business is like any other business, it takes time and a lot to learn.
"Successful people do what unsuccessful people are not willing to do"
