I just found this video of U.S. President Bill Clinton on You Tube and found it very interesting. MLM – Direct Sales always seems to get a really bad rap from the public. It was great to hear the President of the Unites States actually endorse this industry and talk about what an important part of capitalism and overall worldwide economic growth it is. Robert Kiyosaki of Rich Dad Poor Dad fame actually wrote a book about it. The Business School for People Who Like Helping People (2001) This book endorses multi-level marketing as great training for people who want to succeed.

I recently found this article and it made a lot of sense to me. So I thought I’d share it on my blog…

Network Marketing is being taught at more than 200 colleges including Harvard Business School. After extensive research into the network marketing industry, Harvard Business School developed three criteria that a network marketing company must have in order to make it a most desirable opportunity. And what are they???

1. The company must be at least 18 months old, as 90% of all network marketing companies that fail, do so in the first 18 months.

2. The company must have a product which is both unique and highly consumable. Being unique in this case means that you have an exclusive product that can only be purchased from your company?s distributors. Having a product that is highly consumable means repeated sales, thereby guaranteeing customer loyalty versus a one time sale and having to locate new customers.

3. It needs to be a “ground floor” opportunity. Harvard Business School suggests that in order for the opportunity to qualify as a ground floor type, the number of existing distributorships should be less than of 1% in the country where this network company exists. In the United States, this figure is equal to 1.5 million people. Harvard Business School also stated that if there were less than 500,000 people involved, you would be on the cutting edge of a great opportunity. If the company has less than 100,000 distributors, Harvard Business School considers it to be a once in a lifetime opportunity.

Harvard Business School states that there are four distinct stages of growth in a network marketing company. They are:

1. Foundation – This usually lasts approximately six months. This is when a company develops its products and marketing plan.

2. Concentration – This period lasts approximately 2 to 4 years from when the distributor network is started.

3. Momentum – This period lasts from 2 to 4 years also. This is when the company experiences phenomenal growth. Both retail and distributorships explode in terms of expanding growth. It is during this period that the company virtually sweeps the nation. When a company’s sales reach 50 million, they reach what is called “critical mass” (sales go vertical right off the graph). Also, approximately 2/3 of the company’s growth of the new distributorships occur during this period of time.

For example: Let us assume you have an organization which is producing an override bonus check to you of $1000 per month. When the company reaches critical mass, distributors automatically experience a ten-fold increase in their earnings. In other words, $1000 per month becomes $10,000 per month. This is the reason for getting involved on the ground floor, so you will experience the benefits of explosive growth.

4. Stability – This period lasts for the life of the company. A network marketing company that is dedicated to the success of its distributors will experience longevity, thereby insuring that an active distributorship will realize continued earnings and growth.

Who out there doesn’t understand this and agree? I’d really like to get your comments and see what others are looking for in a home based business opportunity.

Blessings …From My Kitchen Table