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How does network marketing work?

There are many forms of network marketing – but to keep it general lets narrow it down to two forms.

Sales oriented network marketing where a distributor retails products and keeps all of the profits. This distributor can also recruit other distributors who sell products and they would then receive overrides from the sales volume created by the organisation.

Recommendation based network marketing. There are no real sales involved by the distributor but instead the distributor helps the customer order products directly from the manufacturer.

The major difference is that in a recommendation based system you don’t have products in stock and you don’t handle cash.

Regardless of the system nearly everyone over the age of 18 is a qualified to start their own network marketing business.

Typically a person is introduced to the business and productline by a distributor, who is probably a friend or an acquaintance. 

This new person then makes up his or her mind wherther to (1) decline, (2) become a retail customer or (3) become a distributor.

When you first become a distributor you typically buy some kind of starterkit containing products for personal use and training/promotional material. The major portion, if not all of the start-up fee should be for actual products – not for anything else

In most cases the distributor also signs up for some type of recurring monthly order, because being your best customer is a fundamental filosophy in network marketing. You don’t get paid for recommending products you don’t use yourself. This monthly order is what qualifies you for commissions in the business.

After that you are qualified. 

Next step is to talk to your personal network about the products and the business. Usually with the help of you sponsor – the person who introduced you to the business. It’s their responsibility to make sure you have all the skills necessary to make the business work for you.

When you sign up your first customers and distributors, it’s game on. The sky is the limit.