Can You Really Make Money?
Can you really make the big money? The short answer is yes. However, most people don't. According to an Inc.com article on direct sales, the median income for an MLM rep is about $2,400 per year. That same article profiles a mom who makes $300,000 per year. Taylor researched Nu Skin and cited a 2008 case study which showed the number of people achieving Blue Diamond status (the highest level of earnings) was 0.14% - not even a half of a percentage point.
The reality is, only a tiny percentage of representatives actually realize the high earnings advertised in MLM promotional materials and at meetings. Some say the big earners got in early and are positioned at the top; however, like other MLM data, this is misleading. First, it suggests that getting in early is all you need to do to be successful, which of course is false. Success comes from work. Second, many companies have been around for over 30 years, and some of their top selling reps joined last year or five years ago. In essence, their top earners aren't only the ones that joined 30 years ago. Finally, yes, of course, the people positioned on top make the most, but that's not because they came in early. It's because they built a business that put them on top.
So is it possible to make any money doing an MLM? After finishing all of his analysis and research on various MLM data, Jon Taylor concluded, “In every case, using the analytical framework described, the loss rate for all these MLMs ranged from 99.05% to 99.99%, with an average of 99.71% of participants losing money in an MLM. On average, one in 545 is likely to have profited after subtracting expenses and 997 out of 1,000 individuals involved with an MLM lose money (not including time invested)."
That sounds dismal unless you're the 1 in 545 or the top 1 percent working your business.
Conclusion
To be clear, MLM is a viable home-based business opportunity. Anyone interested in selling a product to generate income has the ability to achieve success. With that said, is crucial to research and investigate the company and products thoroughly to make sure that it's not a scam, and also, that it's a product and system you feel you can promote. There are many single-level marketing (selling products without a recruiting component) companies where the likelihood for generating income is much higher than typical MLM statistics. This is because compensation comes solely through selling products (no down-lines, minimums or recruitment tactics). Additionally, some MLM companies are product-centric and have compensation plans designed around richly rewarding product sales.
Can you really make the big money? The short answer is yes. However, most people don't. According to an Inc.com article on direct sales, the median income for an MLM rep is about $2,400 per year. That same article profiles a mom who makes $300,000 per year. Taylor researched Nu Skin and cited a 2008 case study which showed the number of people achieving Blue Diamond status (the highest level of earnings) was 0.14% - not even a half of a percentage point.
The reality is, only a tiny percentage of representatives actually realize the high earnings advertised in MLM promotional materials and at meetings. Some say the big earners got in early and are positioned at the top; however, like other MLM data, this is misleading. First, it suggests that getting in early is all you need to do to be successful, which of course is false. Success comes from work. Second, many companies have been around for over 30 years, and some of their top selling reps joined last year or five years ago. In essence, their top earners aren't only the ones that joined 30 years ago. Finally, yes, of course, the people positioned on top make the most, but that's not because they came in early. It's because they built a business that put them on top.
So is it possible to make any money doing an MLM? After finishing all of his analysis and research on various MLM data, Jon Taylor concluded, “In every case, using the analytical framework described, the loss rate for all these MLMs ranged from 99.05% to 99.99%, with an average of 99.71% of participants losing money in an MLM. On average, one in 545 is likely to have profited after subtracting expenses and 997 out of 1,000 individuals involved with an MLM lose money (not including time invested)."
That sounds dismal unless you're the 1 in 545 or the top 1 percent working your business.
Conclusion
To be clear, MLM is a viable home-based business opportunity. Anyone interested in selling a product to generate income has the ability to achieve success. With that said, is crucial to research and investigate the company and products thoroughly to make sure that it's not a scam, and also, that it's a product and system you feel you can promote. There are many single-level marketing (selling products without a recruiting component) companies where the likelihood for generating income is much higher than typical MLM statistics. This is because compensation comes solely through selling products (no down-lines, minimums or recruitment tactics). Additionally, some MLM companies are product-centric and have compensation plans designed around richly rewarding product sales.