Network Marketing

What is Network Marketing

Even in this day and age there are many misunderstandings and preconceptions about network marketing and what it actually is. Some people still believe it’s an illegal pyramid, some get it mixed up with Internet marketing, and sadly some just think it’s a scam.

In reality it’s a highly ethical business model operating in a highly regulated industry and it means a company markets their products through a network of independent distributors instead of putting them in a shop or selling them direct.

There are a lot of benefits to a company of doing business this way, but for us, the motivated individual, network marketing is really a vehicle.

It’s a vehicle we can use to earn some extra income, to develop ourselves as people, and in the case of some of us, gain complete financial independence. It’s a vehicle that’s fuelled by the individual’s personal dreams and goals, and it’s the size, strength, and power of these goals that will ultimately determine how fast and how far you drive your particular vehicle.

This is how it works.

We all know that if you really want to make a serious income you’ll need to work for yourself, because statistics show that working for an employer isn’t going to make you rich. That means you’ll have to have your own business, and when you start that business you’ll need a product or service to offer. For this example let’s say you are marketing a product (as most MLM’s do), and look at some of the traditional business opportunities available to you.


Let’s say you take your products and open a shop. The customers come in to buy and you make a profit. Well that’s great, but you’ll also get all the hassle that comes with owning a retail outlet.

You’ll need lots of investment.

You’ll need lots of stock.

You’ll have to pay lots of rent and taxes.

You’ll need staff, and all the problems that come with that.

And when the shop gets broken into at 3am it’s you they’re going to call.


Maybe you feel you can do better by selling your products to the retail outlets as a wholesaler, and not the end consumer. That way you’ll make less profit per unit, but you’ll have the opportunity to make up for that by fulfilling larger orders. Let’s take a look at the problems you could encounter.

Nobody is aware of your brand to start with

You’ll be cold calling people who aren’t really interested in looking at new products.

Large investment is needed to get started.

Companies that will sell your products expect long payment terms, in some cases 60, or 90 days, so cash flow issues can arise..

Storage and warehousing is expensive, and you’ll need to pay business rent and taxes.

You’ll be working long, long hours.

Selling Direct:

Ok, so let’s say you’re really motivated, have a large comfort zone, and you decide to take the products and sell them directly to the consumer (door to door for example). Perhaps you’d make a good living, but the only way you can increase your earnings is to knock on more doors. That means you’ll also be increasing the hours you have to work. Other issues are….

Rejection. Most people can only take so many slammed doors!

You’ll be out in all weathers

You’ll have to put in lots of hours

If you don’t work, you won’t earn

So you can see that in all the above scenarios you don’t really own a business, you have a business that owns you.

It’s not looking good is it?

Now let’s take a look at network marketing.

With network marketing you can have your own business by setting yourself up as an independent business owner, but you’ll have the backing of a multi million-dollar company with all the benefits that brings, (so it’s a bit like a franchise without the large investment and the long hours). You use the products yourself, and over a period of time you develop a handful of customers that use the products regularly.

Then you duplicate yourself.

When you’ve learned one or two new communication and coaching skills, you can start teaching a few like minded people to do what you’re doing, ie using the products themselves and gathering a handful of customers. That’s the start of what we call ‘team building’ and is where the big money can be made.

The next step is to work closely with the people you’ve introduced and teach them how to duplicate themselves too.

Your job as a network-marketing professional is to keep that duplication going by teaching a large number of people to perform a few simple actions, consistently, over a prolonged period of time. Network marketing works by lots of people doing a little bit, rather than the usual business scenario of a few people doing a lot, and as the duplication continues your company will pay you a bonus based on the product volume of your whole team. In other words, if you’ve taken the time to learn new skills and develop yourself into a leader you’ll get rewarded handsomely for your efforts. If you haven’t, you won’t. That’s honest, ethical, and the way it should be.

In my opinion, what makes the profession unique and truly extraordinary is that there is no solitary success. You success, and your future income potential, relies on you helping your team members to build successful network marketing businesses. You want people to become better than you are, and the more people you can help to realize their goals and dreams, the more successful you become by default.

And the ‘leverage’ you’ll enjoy from a network marketing business is something you’ll be hard pressed to find anywhere else. It’s possible that to start with your earnings may be low compared to the work you put in, but that’s going to be the same in any business you start. However, as your team grows, the effort you put in will start to decrease while the income you receive will continue to grow. After a while you’ll have a true ‘business’. By that I mean something that will generate a large income for you, month after month, whether you’re there or not. That ‘business’ will give you the time freedom to do all the things you really want to do, coupled with the income you need to do them.

So the advantages of a network marketing business are:

You can start part-time without compromising your existing job or commitments

There are no large investments to join, in most cases $1000 or less

There’s no stock holding

There’s no staff needed

There’s no premises needed

There are no overheads except for the ones you choose to have

You’ll have the opportunity to build ‘leverage’ that doesn’t often arise in traditional business

You’ll have the opportunity to build long term ‘passive income’

You’ll be helping others to succeed, and your personal growth will be amazing!

Now I’m not saying that network marketing is perfect for everyone because it’s not. But if you have a dream in life and you’re prepared to take the time to learn a few new skills in order to achieve that dream it may be the perfect vehicle for you.

However it’s very important that you don’t start with unrealistic expectations like so many do. If you’ve worked somewhere for the last 20 years to earn the income you’re on now, it’s not realistic to expect your network marketing business to replace that in a few months is it? But if you know what you want to get from the business, make a plan, and follow that plan, you can replace that income within a couple of years, and be financially free within four or five.


Article by Peter Ragg – Network Marketing Expert

Peter Ragg

Peter worked successfully in the pharmaceutical industry for 25 years, before going into business on his own 6 years ago when he was introduced to network marketing for the first time in his life. Peter “got it” as they say straight away and has not looked back.

Peter now runs two networks, Utility Warehouse and Agel Enterprises and he will introduce you to the opportunity that will suit you the best. He will coach and mentor you to be successful.

Peter says, “I love working with people and network marketing is a people business. What makes the profession unique and truly extraordinary is that there is no solitary success. Your success, and your future income potential, relies on you helping your team members to build successful network marketing businesses. You want people to become better than you are, and the more people you can help to realize their goals and dreams, the more successful you become by default. How cool is that?”


About Ola Agbaimoni

Known as "The Business Detective" due to her "Sherlock Holmes" like problem solving abilities, Ola works in partnership with her sister Carole Pyke, The Business Bard. Together they run Eélan Media, a new type of Business growth agency offering a forensic approach to business and a creative approach to marketing. As well as being an expert in business planning, training and development, Ola is also a certified coach, NLP practitioner; an accomplished author, speaker and presenter.

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