Network Marketing, more commonly known as Multi-Level Marketing (MLM), is the fastest growing yet most misunderstood legitimate work from home business of moving products today. More than 100 billion dollars worth of products are being moved through this marketing system and yet people still question its legitimacy due to their limited knowledge of the business.

So in this article, we will try to undo the misunderstanding by exploring: 

*What is Network Marketing
*3 Steps to Identify a Legitimate Network Marketing Business

Do note that the terms ‘Network Marketing’ and ‘MLM’ are used interchangeably.

Understanding What IS Network Marketing
Breaking down simply, Marketing is the process by which products or services are moved from the manufacturer to the consumer. Network refers to the system of people who are moving the products or services. Network Marketing is therefore the way in which products or services are moved through a network of people.

And because of that, no advertising is required as marketing of the products or service is done almost exclusively via word-of-mouth.

Involving no advertising costs, network marketing companies are able to pump in more money for research and development thus producing the best quality products in the market.

3 Steps to Identify a Legitimate Work From Home Network Marketing Business

1) Are the products being moved? Is there a valid service provided?
Network Marketing is often confused with PYRAMID SALES. Pyramid sales is ILLEGAL! This is because they fail to move products or provide a valid service. They seem similar because both are Multi-level. However, pyramid sales is definitely not Marketing — because products and services are not moving at all!

2) In a legitimate Network Marketing (or MLM) business, NO traditional selling is involved.
In network marketing, you are in business for yourself but NOT by yourself.

Being in business for yourself, products can be bought at wholesale price from the company you are representing. Many people joined a particular company for this sole reason — to buy at wholesale. Therefore, you can, if you wish to, sell those products at retail price and make a profit. Now this is where the most common misunderstanding about MLM comes in — People think that you HAVE TO sell retail to be successful in this business. THIS IS NOT TRUE.

Yes, retailing products can earn you a profitable sum of money and some MLM programmes even require a sales quota to be met in order to qualify for a bonus. HOWEVER, the most successful network marketers make the larger sums of income by building their organization.

With this organization, every distributor just needs to retail a little if he or she wants to.

95 percent of the people cringe at the word “selling”. In MLM, there is no need to “sell” the products. However it is crucial that the products are moved or nobody gets paid. When you build a network of people, products can be channeled through your organization. That is why sales in network marketing come as a natural result of distributors sharing the products with their friends, neighbors and loved ones. If you simply SHARE the quality of the products to your friends, that is ALL the “selling” involved in a network marketing business.

3) Commitment to Sponsoring and Teaching NOT recruiting.
Network Marketing (MLM) is often confused with Direct Sales. The one distinct difference is that in MLM, it is the SPONSORING of distributors into your team not recruiting (as with Direct Sales organizations). There is a vast difference between recruiting someone and sponsoring someone.

Recruiting would mean to just “sign them up” whereas in sponsoring, you sponsor someone and teach them how to do what you are doing.  When you sponsor someone, you are making a commitment to help them build a business of their own. Therefore as a sponsor, you are responsible to teach your people all about the business.

Jianwei Huang writes about how you can build a legitimate work from home business frequently. Visit www.5000dollarsmonthly.com for more on work from home singapore business.

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