What is MLM? – How does MLM work?

‘How does MLM work’. When you enter a MLM – Multi Level Marketing Company you normally will get sponsored by a person. When MLM is new to you it might me a little bit overwhelming to understand where to start. So be aware that in the beginning you need to follow 2 roads:

One road means selling products – and the other one means finding other sales reps, called ‘distributors’. Find the answer on How does MLM work by applying the next steps.

1. Find Customers – Sell Products

Why selling products? You already know the answer! When selling products you will earn money. This money I like to call ‘active income’. How many customers you need, how many products you need to sell depends on the Marketing Plan of the company.

So for example: you opened your own business with a Multi Level Marketing Company in the health sector. As you should know what you are selling it is quite natural that you have to buy a product or product range for yourself. Of course you buy this at a lower price than your client. So, when selling a product, you earn your first money. Referring to a Marketing Plan I know, I can tell you that you have your own product for free with 5 (five) clients. [Remember, this is an example – the amount of clients may differ from company to company.]

Once you have finished this step you will concentrate on the next stage regarding How does MLM work

2. Find other Distributors – Build your Downline

You now will learn and concentrate on how to find other sales reps who will follow you in doing the business.

Also here your sponsor will be at you side, will prepare you and may also accompany you, when you are doing the first presentations of the business.

A good MLM Company in this case will also support you with further information and supporting tools.

As you are earning from the sales of your distributor – and here starts your ‘passive income’ – it is quite natural to concentrate on the support of your sales rep or ‘downline’.

Conclusion: When you start, 1rst find at least as many clients as you need to have your own product for free and 2nd concentrate on building and training your  direct downline.

Once your sales rep is ready to work without your support, make sure that he will be able to train his downline to get customers.

You now have time to find other sales reps, train them, ‘let them free’ and again look for another sales rep who will work together with you on creating a great ‘passive income’. How many members you want in your downline, depends on what you want to earn and where you want to arrive in the hierarchy of the MLM Company.

Depending on your monthly income (direct and passive) you will climb up the ladder. Which means other bonuses or incentives.

To remain in a certain position, mostly you have to confirm month after month the income of the last month or naturally better to increase it.

When looking at the Marketing or Compensation Plan, it is up to you where you will arrive. It is not said that everyone needs or wants to arrive at the top. It might be your personal goal, your challenge to arrive there. Another one will be happy with a certain amount of guaranteed money and remain on this level.

It’s all up to you. You will be rewarded for your efforts, your work. No one will climb up because he knows someone inside the MLM Company or because he is good looking or can be convincing with words. Nope – the only thing which counts is the personal engagement and the results, received this way.

So, when you start, see yourself as the fresh owner of a store who sells goods and gradually open outlets which will help you to sell your goods. You are responsible for the new (outlet) shop owner, you will support and help him to be able to do the same as you did for them.

Let me know if this answered your question: How does MLM work?