Selecting the Best MLM Company – Whatever Happened to Due Diligence?
Yesterday’s article was motivated out of some frustration in typically encountering minimal due diligence by those joining companies in the network marketing industry. We’re not sure the process being followed, other than knowing that most buying decisions are emotionally charged. And it seems in this industry, that the need to “justify” a decision made emotionally carries on in the form of denial.
Of course every company in this industry is extremely adept at “convincing” their distributor force that they’re in the best of the best. We often hear how this company is the “real deal.” This despite the fact that most distributors have experienced multiple companies. We’re not sure what is up with that except knowing that network marketing leaders are very good at positioning their opportunity against the competition.
We recognize, certainly, that some opportunities and companies are a better fit for certain individuals. Also, it is apparent that top leaders will earn significant sums in even the most difficult compensation plans. Regardless, it seems that selecting an endeavor that will span up to several years or longer should be made with a little more forethought than simply the emotionally charged atmosphere of a hotel meeting. Obviously it’s great for the recruiter to have “landed” another one, but is it really best long term?
The turn-over is extremely high in the industry. Could this be reduced if new “recruits” were given or sought out more complete information on the industry, the types of companies represented, and basic competitive data right up front? Regardless, we wanted to briefly address some basic selection criteria important in choosing the best network marketing opportunity and company for an individual.
- The company – What is the company’s history and track record. Given that many start-ups fail in the first couple of years, it may be advisable to avoid newer companies until they have some track record. Of course being in first can have its advantages, too.
- The founder – You really should put your company founder’s name in Google before signing any paperwork or enrolling. What comes up? Of course you’ll see a lot of references to “scam,” but this is pretty much marketing efforts to get people to a particular website. You’ll find out this way if he’s for real.
- The management and science advisers – Every company seems to have a long list of scientists and doctors involved, at least in the health-related companies. Put these people’s names in Google, too and see what you can ascertain of their particular accomplishments and expertise.
- The products and scientific results – Not every company has science-base products, but most stake some claims in this arena. Check the company’s website for references and try to find third-party endorsements. What tangibly differentiates the company’s products from others?
- The compensation plan – Does the company publish earnings data of its distributor force? How popular is the company with the distributor force. Check the MLMInsider.com company rankings, which is a measure of distributor satisfaction with all company aspects, particularly their earnings.
We’d really like to see is more new distributors really understanding this industry first vs. just being sold on one company. Usually their first experience doesn’t work out so well, perhaps due to the steep industry learning curve. Maybe that is ok, as a high percentage of entrepreneurs fail miserably at first, and most beginning network marketers completely underestimate the industry’s steep learning curve. Many tools for building any MLM business are now available, which are also helpful in earning while learning to market, particularly on the Internet