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How to Choose a Multi-Level Marketing Business (part 2)

written by: Heidi Wiesenfelder•edited by: Jean Scheid•updated: 7/6/2011

Hundreds of companies use a network marketing model and are currently open to new distributors. So how do you choose one? These tips provide guidance for anyone interested in learning more about the types of companies that offer a multi-level marketing model and the criteria to use in selecting one.

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    See the first part of this article for more information on selecting a multi-level marketing (MLM) company.

    Distributor experience: Talk to a variety of distributors to learn about their experiences with their sponsors, with customers, and with compensation. If possible find individuals in different parts of the organization (i.e. not all in the same downline) to share their stories with you. Consider searching online forums for postings about the company; you will generally see examples of both the best and the worst experiences posted.

    Customers: If you can, talk to customers of the company's products or services. Find out why they buy them, how long they have done so, and what will influence their decision to continue doing so. Is it based primarily on a relationship with their affiliate, on the products themselves, or on their belief in the company? How would this affect your success selling the products?

    Image by emsago via stock.xchng Startup costs: Many companies have an enrollment fee for becoming a new distributor, and many also have an annual renewal fee. Often new distributors are encouraged to purchase product in large quantities for sampling, parties, or other business opportunities. Find out if this is a requirement or merely a recommendation. Typically affiliates need to purchase their own marketing materials, so ask for details on the materials available. You may also want to find out if you are allowed to create your own promotional materials. Clarify whether you will need to purchase a minimum amount of product on a regular basis to qualify for payouts, as this is a common requirement.

    Training: What methods does the company use to provide training and assistance to new and veteran affiliates? Are new distributors required to complete certain types of training, or is it all optional? Is attendance at an annual company event required for certain levels of compensation or achievement? Does the company accommodate different learning styles, so that you can learn in the way that is best for you?

    Methods: The well-known home party system is not the only way to run a network marketing business. Other techniques include sampling, event booths, and online marketing. Which techniques are feasible for this company and its products? Would you be comfortable and likely to succeed using the methods that are available?

    Company leadership: Do the company leaders interact with their downlines or do they seem too busy? Based on the people in leadership positions with the company, could you imagine yourself in their shoes in a few years? Have they all been with the company since its inception, or are new leaders continually being created?

    Every individual has a different reason for wanting to become a distributor for a network marketing company. And each has a different set of factors that strongly influence business success and satisfaction. So consider these criteria as well as anything else that helps you judge whether a company is a good fit for you. Once you have gathered and reviewed all the information, make the choice that is right for you, and get started becoming a successful distributor.

About Network Marketing aka Multi-Level Marketing (MLM)

Learn what MLM is, what makes it different from illegal pyramid schemes, how to choose a company to work with, and how to succeed as a network marketer in this 3-part series.
  1. Network Marketing Businesses Explained
  2. How to Choose a Multi-Level Marketing Business (part 1)
  3. How to Choose a Multi-Level Marketing Business (part 2)
  4. How to Succeed at Multi-Level Marketing