Every network marketing company boasts of a compensation plan that creates passive income through leverage. Yet majority of people who join the business fail because they do not understand how leveraging works. Most people fail because their focus is on recruit, recruit, recruit, numbers, numbers, numbers… It is a race against time and others to recruit before someone else does. Now you have hundreds of recruits who don’t know where they are going. You don’t have time either to build relationships or train so many of them. They are left helpless on their own. They start dropping out in hoards. You are back again recruit, recruit, recruit. This is definitely not leveraging your time or effort.
There are marketers who can recruit dozens, even hundreds, of people through the motivation of greed. But when it comes to something sensible and worthwhile, they shy away from becoming involved. This is because they think network market is just a numbers game. They tell their new recruits that they will have spill overs in their downline. That there is no work involved. Lies, lies, lies and more lies… With this kind of thinking they will attract recruiters who think the same way. No wonder a culture of ‘no work’ sets into the organization and the network collapses. They are now back to recruit, recruit, recruit through more greed and lies.
If you have to leverage then you have to sponsor, sponsor, sponsor and Retain, retain, retain. There is a big difference between a recruiter and a person who sponsors. A recruiter is interested only in numbers. The sponsor on the other hand takes upon himself the responsibility for the growth and the welfare of the person he has sponsored.
People who treat their network as numbers never succeed in this business. To succeed you have to remember your network consists of human beings who have hopes, dreams and desires. They have inadequacies, problems and financial needs. They need your help to succeed. If you are willing to coach and help them with a servant’s heart they will deliver results beyond your wildest dreams.
What is the best way to develop a solid marketing force that never leaves your network? Sponsor a few key people at a time. Give them your full time and support. Build relationships. Help them to succeed in the business and train them to do the same. You have to build your network market on the right principles to succeed. There are no short cuts. Are you willing to take the responsibility to becoming a sponsor? If so then please read on.
There are people who will tell you “just recruit a lot of distributors. You’ll get at least a few good ones that way.” Few leaders will emerge along the way and your work is done. You can then have all the passive income you need. Leaders don’t emerge in business. You have to find talent and develop them. Once in a while you can get lucky but that does not happen very often. You can’t leave your business to chance if you wish to succeed.
The bottom line: leverage is mandatory for wealth creation, and you will not become wealthy without it. You are either exercising the power of leverage for yourself, or you are serving as leverage for someone else, and building their wealth for them.
To apply leverage you have to find a network marketing company that has a very strong training and personal development program. Please also look at the credentials of the person who wishes to sponsor you. Is he committed to your success? Does your upline have requisite support systems for your training and success? Avoid network marketing companies that boast of automated recruiting system to increase numbers. You never build a network by merely having a recruiting system. Your network will collapse. To increase retention you have to have a proper support organization and training that builds relationships. Do not join a company that focuses on recruiting and numbers.
Next important thing is that people must see value in the product. Many network marketing companies fail because they do not have a product that can sustain the business. You can’t fool all people at all times. Network marketing is a relationship business that is built on good faith and recommendation. You just cannot build a strong belief system based on a weak product. The product has to sells itself because of its intrinsic value only then the retention rate of distributors in the business will increase. Leverage can work only when retention rates are high.
Lastly and most importantly people want a fair compensation for their effort in the business. There are network marketing companies that distribute only 10% to 30% of the total revenue to the distributors. An outstanding company is the one which is committed to distributing over 50% of the group volume (gv) to its distributors. People will stay in the business if they make money. Some compensation plans are heavily loaded in favor of the ‘heavy hitters’ or the people who reach higher levels in the business. These plans do not adequately compensate the new distributors for their effort in the business. This results in new distributors getting disillusioned and dropping out. This is very bad for the business. For leveraging to work retention is the golden key. To succeed in network marketing the business model or the compensation plan has to work correctly. Initial cost of joining the business, risk involved, return on investment (ROI) and the break even point have to be properly balanced out. The new distributors will stay in business if they can recoup their initial investment in the shortest possible time and start making profit from the business. The plan has not only to be generous but also very equitable and rewards those who put effort into their business. If the new distributors can recoup their initial investment and can be in profit within few weeks of joining the business, they will not leave the business. This makes great business sense because the retention levels will be very high and the leveraging power of the business will kicks in.
Leveraging which is the basic principle behind network marketing can work only if the network you create has the power not only to sustain itself through high retention rate but also to expand itself exponentially once it is created and set up correctly. This can happen if there are right kind of training and support systems, belief in the quality of the product and a fair, equitable and generous compensation plan in which new distributors can start earning money in the shortest possible time.