7 Days, 7 Insider MLM Secrets – Day 3

by louabbott on July 3, 2010

The whole, inside truth about picking the right company.
Or, if you are with one of the very few good ones, how to help others, including your own organization to really appreciate it!

Are you ready for more?

In Day 1‘s material, we covered just how critical working with the right company is.  It is the bare minimum for:

Reliable, Long-term, Leveraged, Residual Income

Residual income can be like an oil pump

Residual income can be like an oil pump.

We also talked on Day 1 about how partnering with the right company was very much like drilling for oil. If you are not in the right place, you will only be wasting your money, time, skills, reputation, energy, and chances for ever realizing your success and dreams.

In our Special Report, M.L.M. The Whole Truth, I introduce people to The 12 Critical Success Factors to help networkers know if they are choosing, or have chosen, the right company partner. Those Success Factors are also extremely useful to build appreciation in your people and prospects if you are with one of the few good companies out there.

I would like to give you the first two in this free email seminar.  Today…

The First Two Critical Success Factors

These first two of the Critical Success Factors will help you determine if the company you choose (or have chosen) will be around long term to pay you a long-term, residual income after you have done the real work of building a successful business.

They will help you determine if anyone else can also have confidence in the company. As with the other 10, if any one of these is missing, it could be enough to dash your chances of making money long term with the company.

Critical Success Factor #1: Company Track Record

This is probably the most important factor of all for you to consider. Many people have wasted enormous amounts of time, energy and money with companies that were destined to fail.

Fact: Depending on the source, the reported failure rate for all types of businesses during the first four years ranges from 55% all the way up to 85%!  (See – http://www.bls.gov/opub/mlr/2005/05/ressum.pdf )

It is probably toward the higher end for new MLM companies. Needless to say, you can’t build a reliable, long-term residual income if your company partner goes out of business. And, most do! Tens of thousands of MLM companies have opened their doors in the last 50 years, but you can count on your fingers and toes the number that have grown beyond three hundred million in annual sales. And most of those are having a very tough time growing.

So unless you like throwing the dice and risking years of work for nothing if the company you pick goes under, be extremely about “ground floor” or new, “start-up” opportunities” – many go from ground floor straight to the basement! Many more simply can’t sustain growth for more than a few years. (You will simply have to read Day 5 to cut through the massive amount of hype and BS on this point.)

But this is the real test for people of integrity, if the “deal” is only good because you got in on the “ground floor,” what will you say to people coming in a year from now? Two years from now? Is someone ultimately going to be hurt and deceived? You can answer for yourself, but I would submit that in the very least, it is NOT a reliable, long-term “business opportunity.”

As a rule of thumb, a proven track record of growth for 3 years would be the minimum. I say that because if any business, in any industry, can grow for 3 years, they have probably proven that they are more than just a gimmick or fad and they probably have survived at least the early start-up difficulties.

That said, the company that I described my experience with, in Day 1, grew for about 7 or 8 years before they stopped growing and started going backwards. So use good judgment and evaluate the strength of the company’s track record along with the other Critical Success Factors.

If you are tempted to break this longevity rule, still look at track records.  I make an exception only when the track record of the founders and owners of the new company have extraordinary track records of success in MLM and in running successful companies. It is quite rare for owners to have proven track records in BOTH of those areas.

red flagRed Flag – Be sure to look at the growth of a company in the markets that you will be working. While some companies have managed to sustain growth for much longer than the average, it has been by opening new markets in new countries because their growth has stopped in their initial market(s). Company growth, in markets where you know no one, will do you very little good, unless you are willing to travel, learn new languages, etc. Additionally, the company may divert all of their attention and resources toward where the “easy hanging fruit” grows, not to where it will benefit your efforts.

Critical Success Factor #2: Financial Strength

One of the leading causes of the failure of many new startups is that so many are under-capitalized. Even if all the other factors are right, if a company doesn’t have enough capital to keep up with growth, expand infrastructure, etc., it will run into difficulties that can be fatal. You need to find out how much money is available and how committed the investors are to the long-term success of the company. That is rarely easy to do, however.

With a publicly traded company, you can look at the annual reports, if you know how to read them, and you don’t have to take anyone’s word for the strength of the company’s financials. Although even public company financials can hide the truth – recall the Enron scandal, for example.

On the other hand, public companies have additional loyalties to guard that usually take precedence over their loyalties to their customers and independent representatives (i.e., you!). That loyalty is to their stockholders!

Once again, a track record of well-managed growth may be the best determinant. If the company has survived a sustained period of growth already, odds are they have already cleared many financial hurdles and will continue to do so. But make sure you look at whatever information you can get and ask as many questions as you can. I recommend meeting the principals in the company if you are making a serious commitment of time to building a business with them….That will lead into Day 4…

The Critical Success Factor that Can Keep You from Losing Your Residual Income in a Heartbeat.

“See you” on Day 4 in two days.

As always, I wish you the very best of everything and a truly GREAT life.

Sincerely,

Lou Abbott's signature

Founder of the new…
www.MLM-theWholeTruth.com for people who want to know the up-to-date, whole truth about the industry.

“Economic disaster begins with a philosophy of doing less and wanting more.” –Jim Rohn

If the link to this page was forwarded to you,
You can get your own subscription to this
7 Days, 7 Insider Secrets, MLM The Whole Truth
Seminar by clicking here.

Welcome to Day 3
MLM-theWholetruthLogoSmall.jpg
The whole, inside truth about picking the right company.
Or, if you are with one of the very few good ones,
how to help others, including your own organization to really appreciate it!

Are you ready for more, ~Contact.FirstName~?

In day 1’s material, we covered just how critical working with the right company is.  It is the starting point for:

Reliable, Long-term, Leveraged, Residual Income

We also talked on Day 1 about how partnering with the right company was very much like drilling for oil. If you are not in the right place, you will only be wasting your money, time, skills, reputation, energy, and chances for ever realizing your success and dreams.

In our Special Report, M.L.M. The Whole Truth, I introduce people to The 12 Critical Success FactorsTM to help networkers know if they are choosing, or have chosen, the right company partner. Those Success Factors are also extremely useful to build appreciation in your people and prospects if you are with one of the few good companies out there.

I would like to give you the first two in this free email seminar.  Today…

The First Two Critical Success Factors

These first two of the Critical Success Factors will help you determine if the company you choose (or have chosen) will be around long term to pay you a long-term, residual income after you have done the real work of building a successful business.

They will help you determine if anyone else can also have confidence in the company. As with the other nine, if any one of these is missing, it could be enough to dash your chances of making money long term with the company.

Critical Success Factor #1: Company Track Record

This is probably the most important factor of all for you to consider. Many people have wasted enormous amounts of time, energy and money with companies that were destined to fail.

Fact: Depending on the source, the reported failure rate for all types of businesses during the first four years ranges from 55% all the way up to 85%!  (See – http://www.bls.gov/opub/mlr/2005/05/ressum.pdf )

It is probably toward the higher end for new M.L.M. companies. Needless to say, you can’t build a reliable, long-term residual income if your company partner goes out of business. And, most do! Tens of thousands of M.L.M. companies have opened their doors in the last 50 years, but you can count on your fingers and toes the number that have grown beyond three hundred million in annual sales. And most of those are having a very tough time growing.

So unless you like throwing the dice and risking years of work for nothing if the company you pick goes under, stay away from “ground floor” or new, “start-up” opportunities” – many go from ground floor straight to the basement! Many more simply can’t sustain growth for more than a few years. (You will simply have to read Day 5 to cut through the massive amount of hype and BS on this point.)

But this is the real test for people of integrity, if the “deal” is only good because you got in on the “ground floor,” what will you say to people coming in a year from now? Two years from now? Is someone ultimately going to be hurt and deceived? You can answer for yourself, but I would submit that in the very least, it is NOT a reliable, long-term “business opportunity.”

As a rule of thumb, a proven track record of growth for a minimum of 7 years would be prudent. I say that because if any business, in any industry, can grow for 7 years, they have probably proven that they are more than just a gimmick or fad.

That said, the company that I described my experience with, in Chapter 1, grew for about 7 or 8 years before they stopped growing and started going backwards. So use good judgment and evaluate the strength of the company’s track record along with the other Critical Success Factors.

Red Flag – Be sure to look at the growth of a company in the markets that you will be working. While some companies have managed to sustain growth for much longer than the average, it has been by opening new markets in new countries because their growth has stopped in their initial market(s). Company growth, in markets where you know no one, will do you very little good, unless you are willing to travel, learn new languages, etc. Additionally, the company may divert all of their attention and resources toward where the “easy hanging fruit” grows, not to where it will benefit your efforts.

Critical Success Factor #2: Financial Strength

One of the leading causes of the failure of many new startups is that so many are undercapitalized. Even if all the other factors are right, if a company doesn’t have enough capital to keep up with growth, expand infrastructure, etc., it will run into difficulties that can be fatal. You need to find out how much money is available and how committed the investors are to the long-term success of the company. That is rarely easy to do, however.

With a publicly traded company, you can look at the annual reports, if you know how to read them, and you don’t have to take anyone’s word for the strength of the company’s financials. Although even public company financials can hide the truth – recall the Enron scandal, for example.

On the other hand, public companies have additional loyalties to guard that usually take precedence over their loyalties to their customers and independent representatives (i.e., you!). That loyalty is to their stockholders!

Once again, a track record of well-managed growth may be the best determinant. If the company has survived a sustained period of growth already, odds are they have already cleared many financial hurdles and will continue to do so. But make sure you look at whatever information you can get and ask as many questions as you can. I recommend meeting the principals in the company if you are making a serious commitment of time to building a business with them….That will lead into Day 4…

The Critical Success Factor that Can Keep You from Losing Your Residual Income in a Heartbeat.

“See you” on Day 4 in two days.

As always, I wish you the very best of everything and a truly GREAT life.

Sincerely,

Founder of the new…
www.MLM-theWholeTruth.com for people who want to know the up-to-date, whole truth about the industry.

“Economic disaster begins with a philosophy of doing less and wanting more.”  –Jim Rohn

If this was forwarded to you,
You can get your own subscription to this
7 Days, 7 Insider Secrets, M.L.M. The Whole Truth
Seminar by clicking here.

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