A subtle aspect that is often overlooked when evaluating an MLM company is the BIG money question: How willing and able are the owners to reinvest the profits back into the company?
Now, that may not be an easy question to answer. Most people who plug into the daily or weekly company news updates and are experienced in the industry could potentially and eventually get a sense of where the owners stand as far as profit allocations go. Even still, owners’ selfish motives are not easily discerned by the untrained eye.
That’s why I’m here. To help you spot profit hungry owners, so you do not have to go through the painful experiences I’ve been through a decade ago.
I remember the owners of the first company I built big with a massive team of 9,000 people and where I hit the 3rd highest rank at the top. I won’t mention the name of the company. Okay, but if you really want to know I’ll give you a hint . . . It starts with an A and ends with a N.
The owners were brilliant network marketers but they were committed to pay the minimum commissions that the industry regulators require. They also reinvested a percentage of company profits to add a stream of new service and product verticals that by my 5th year in the company, it had morphed into something different than what I had originally signed up for. Every quarter, it was like I had signed up in a new company with a new service I had to learn all about. Have you felt like that before?
Like one day you’re selling a nutrition product and then the next day they get you all hyped about skin care? Wait a minute . . . What just happened here? I know I didn’t sign up in Mary Kay, because I would’ve if I wanted to join a beauty company, but I didn’t because I don’t want to give guys 80 facials a week.
Not all company owners are profit hungry. I’ve been impressed with one particular company owner who never took a paycheck or profit sharing in order to pay the field the maximum he possibly could. Unfortunately he passed away before you could build his MLM legacy.
It’s the owners right to profit share. They took the risk, they put in the effort, it’s their company and they deserve to profit.
However, owners of network marketing companies who are able and willing are wise when they choose to reinvest as much of the profits as possible back into the sales force for as long as possible.
At the end of the day, the field is motivated by making money. If you pay us, we build. If you pay us well, we will stay and be loyal.
As an owner the best way to grow a company is to invest in the people who build it first. Part of that also requires investing into company events, encouraging environment, competent staff, compensation enhancement, and e-marketing tools, and of course when it makes sense and the timing is right, fund new product offerings.
As for you my friend, what matters most is how motivated are you to help your company’s owner make their 56th million when you’re still trying to earn your first? How excited are you to help your owner buy their second yacht when you’re trying to help your reps earn their first thousand? How excited are you to make your owner a billionaire when the people on your team are struggling to make 6 and even 5 figures?
The owners deserve to live well, so do productive reps who are on the front lines bringing in the business. In an ideal network marketing company, the owners and the leaders who build it should make a fortune, customers should benefit, and the result should be financial freedom for everyone who commits and produces results. It’s a partnership.
To sum this up, the relationship between Owner and Rep from a moral perspective is mutualist, symbiotic relationship where the rep says to owner:
“I’ll bring you business as long as you are fair, consistent, and play by the rules.”
And the company owner says to the rep:
“I’ll reinvest into you as long as you are bringing in the business and appropriately modeling our company values.”
The question to ask here is:
15. What matters to the owners MORE — making money or making a difference?
Questions 1 to 14 are discussed in my previous blog posts. To learn more about what you need to know before joining any MLM company, you can follow my posts on Medium here.
Till next time,
Charles
Co-authored with Dr Maral “YESS” Yessayan, PhD.
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