Risk

Business Risk

When you look at network marketing as a potential solution to help you earn money you should do so knowing that it is a risk just like any other business, yet that risk can always be mitigated dependent on ones thinking.

  • Risk is classified as strategic and tactical.
  • Risk is mitigated to a degree by the fact that we have the opportunity to build downlines (which is probably the primary attraction due to the residual income effect); but therein lies another challenge.

Strategic Risk

Network marketing has become divisive because there aren't enough people in the World to fill every downline; and here's another interesting point which gets virtually no press - the issue of an over-supply of 'biz-ops' which further dilutes the Industry and create intense competition.

Tactical Risk

Now add into the mix (against the back-drop of the above strategic risk);  the way our World is today, with instant communication and the expectation of instantaneous gratification along with the processes that independent distributors follow to go to market, with little training, with little business experience, some selling the product, some selling the opportunity, many doing it online and you can see why many struggle to achieve their goals or overcome the 5 killer challenges.

At the end of the day, risk is exacerbated and failure levels increased because vast numbers of distributors simply cannot sponsor enough people quickly enough to qualify and/or get the retail sales revenue they need to become profitable and ensure their home business is a going concern.

Legislation To Offset Risk

Because of the way network marketing has been managed and misrepresented, legislation has been introduced to put less emphasis on recruitment and more on retail sales. In some instances this is merited because of the way illegal pyramids have been introduced and sold in the past, however one could argue that this is counter intuitive to the entire premise of the Industry and rationale for ordinary people to get involved.

Human Legacy

Money and trade has been around for thousands of years but it has all been fabricated by man. Some rules work for the many and some do not. One can argue that rules have been introduced to control and to retain power and/or to provide equality or fairness.

If one was ever to look for examples of highly controversial and damaging processes then look no further than the variation of interest rates offered by banks to penalise and clearly discriminate against people who have less money; or how the 'Brexit process' has fallen apart from a poorly devised initial referendum to a divorce agreement that no politician seems to like. We should never forget that these examples have been initiated by a few people and manipulated for their own ends.

So, it is in this environment that we as Network Marketers need to find ways to overcome risk by understanding and developing the processes and tools we need in place in order to succeed.

Mitigating Risk

Most people involved in network marketing look at tactical ways to make money, from sourcing leads to having one on one conversations that with luck, build an initial downline, in the hope that those they bring in can duplicate the process. Few look at the systemic failures of our World yet blame the Industry when things don't go well for them. This cycle needs to be broken so that the Industry can flourish as a solution to making money whilst taking into account the obvious limitations of a finite population.

Of course, this isn't likely to be led by the biz-ops themselves as it is not in their interest, so the process of optimising network marketing needs to be driven by Distributors themselves as one of the primary beneficiaries. it is clear that without Distributors there wouldn't be a network marketing industry.

We started looking for ways to mitigate all risk in December 2015 and the output of many months and years of thought and development was MLMBuyer, the MLM Buyers Guide and our MLM Community...