7 Days, 7 Insider MLM Secrets – Day 2

by louabbott on July 3, 2010

The Greatest Kind of Income Defined & the Uncensored Truth About Who Gets it!

Welcome back!

You will recall from Day 1 that we clearly defined an incredible kind of income – reliable, long-term, leveraged, residual income.

I also promised that before you are finished with this 7 Days Series, you will have at least 7 of the Insider Secrets, that I struggled to learn over ten long years of focused effort, relentless study, and persistent action.

You will also know the most important basics to help you determine if you are on the right path to finding a …

Reliable, Long-Term, Leveraged, Residual Income Producing, Network Marketing Opportunity

So let’s pick up where we left off…

This is obviously an extremely desirable and valuable kind of income.

It is also very rare.

How rare?

This is where things get dicey.

Let me tell you a terribly true story…

“Jim,” an extremely successful San Francisco executive with international sales and marketing experience, joined a better than average MLM company, worked hard for three years and was one of the most successful new distributors the company had seen in years. Not surprising, Jim had succeeded in every business venture he ever entered. Everyone was admiring his success. If you looked at his check, you would probably have been impressed.

Everything looked promising for him. Significant “leveraged residual income” that could see him through his retirement years in style looked like a real possibility.

The truth be known, though, he was not even making a profit.

The costs of doing business, simply put, exceeded the size of his commission checks. His expenses exceeded his income. (Of course, almost no one knew that!) In fact, after even two more years, a total of five years of intense work, he was almost broke. Then the company changed the compensation plan – radically.  Then they sold out. The new owners made more changes. Then the new owners sold out.  Checks that were in the five figures range monthly at the peak of his business diminished to the low four figures. The promised “residual income” was drying up faster than a puddle of rain in the desert sun.

(Obviously, this created quite a crisis for a lot of us!)

When reality set in for Jim, it was the most depressing reality he had ever faced. He had given up years of healthy six-figure income from the career he left behind in order to build this new business. He had lost the respect of many of his friends and family.  What in the world could he do to secure his retirement with the now shortened number of years he had left at age 62? With huge family obligations still to meet, he had always carried large life insurance policies.  The thought crossed his mind more than once that he was worth more dead than alive.  For a period of time, I was actually worried that the end of this story might be Jim’s suicide.  I did everything I was capable of doing to prop up his and my failing businesses (and lost a small fortune in the process), but ultimately it proved futile.  Our businesses failed.  The good news is that Jim ultimately recovered and found another business – not multilevel marketing – he says he will NEVER do MLM again.

My story is similar.  When you understand it, you will understand a big piece of what motivates me also.

So let me tell you my story. Then see if you can guess how successful I was in MLM, or, even more importantly…

Guess how well people on my team were doing.

In 1996, I enrolled in a major, well-known Multilevel Marketing (MLM) company. I did my “due diligence,” to the best of my limited knowledge at that point, to make sure I was making a good decision. The name of the company was well known and respected. It was a very solid, publicly traded company, and, when I joined, had been enjoying a 5-year run of impressive growth.

So, I made the decision and went to work. And I mean, I really worked. By the end of three years, I had personally recruited 83 “business builders” into my organization – some very talented and successful people included. (In case you don’t know, that is much better than average.) But . . .

Do you think I was making the big money?

You would be right if you guessed “no.” My total profits for those first three years of full time work were about $26,000, again, much better than average, but certainly not impressive.

I should tell you that I had some experience going in. I did a short stint with one of the biggest companies in the MLM industry. I also had worked with a newer MLM nutrition company for nine months with very little in the way of results before finding this company.

Now – Here’s the important point.

How about the 83 people that I “recruited”?  How many of them do you think were profitable in their business efforts? Guess low and then read on.

Did you guess 10%? In the national conference call trainings  I have been conducting for the last couple of years, I ask that question all the time. Interestingly, the highest percentage that anyone has ever guessed is 50%. And that was only once. Mostly, the guesses are under 15%. That tells you something about the reputation of the MLM industry. Some say less than that.  Do you think it might be even less?  Maybe 5, or 4, or 3?

The answer is . . . if you guessed 3 people, you would be 3 too high.

No kidding. The truth is, none were profitable! What’s more, those 83 people spent more than $169,000 combined on just their initial product orders! Of course, they spent much more than that on tools, tapes, training materials, training events, not to mention all of the products they bought in subsequent months because they needed to qualify for the minimums for higher “status” or more commissions, etc., etc., etc.

Well, as you can imagine, when it finally sank in just how horrible those results were, I was extremely depressed and disillusioned. One thing for sure, I absolutely knew that I could not continue recruiting people into a losing proposition.  In fact, I stopped recruiting that very day in August 1999…until I learned some of the Insider Secrets that I will share with you over the next 6 days.

(Of course, my story didn’t end there or I wouldn’t have much of a way to help you today – and I do.  In fact, my various MLM crises have taught me a lot that can absolutely help you.)

Here’s the first cold hard truth that you need to accept before you take another step:

Secret #1 – Most people lose money in MLM

One MLM critic claims it is more than 99.9%!  While I think he has really tortured the numbers, truth be told, for every person who really has made BIG money, I mean 7 figure annual incomes, there are probably tens of thousands of people who lost money trying.  The most common belief that people have about MLM is, “The ones at the top make all the money, while everyone else loses.”

Sad to say, though the “ones at the top” analogy to an illegal pyramid scheme is flawed, that reputation has been earned.

But here, I must emphasize…

It does not need to be that way.

In fact, my mission, without mentioning any companies by name, is to teach as many people as possible the principles that they will need, for as long as they live, about the business fundamentals that must be in place if you wish …

A Money-Making, Reliable, Long-Term, Leveraged, Residual Income Producing, Network Marketing Opportunity

Also . . .

How to  quickly spot and identify scams, schemes, and just plain bad business models.

So here is your Day 2 “Secret” – one of the ones you won’t hear the “Bigwigs” talking about:

It doesn’t matter how many tools a “distributor” has, or what kind of “great system” they use, or how incredibly life-changing the products are, or how early they get in, or who your “upline is,” etc., etc., etc., if the fundamentals of the business they are building are wrong, they will never build a reliable, long-term, leveraged, residual income!

In fact, they will probably end up losing money.

Residual income can be like an oil pump

Residual income can be like an oil pump.

I once knew a guy that had one of those oil pumping rigs, you know, the ones that look like grasshoppers, in his front yard.  I thought that might be kind of ugly to look at every day.  He had a different opinion.  He said, “You know, every time that thing dips down, I think ‘$5.00.’  Every time it comes back up, I think ‘$5’ again.  That goes on hour after hour, day after day, week after week – $5, $5, $5, $5, $5.  So it has started to look pretty good to me.”

I digress, but here’s the point…

Suppose you wanted to have an oil pump in your yard, you could hire the best drillers and buy the best equipment and drill night and day until h— freezes over.  If there is no oil there, you just wasted a fortune.

What oil companies do first, is spend millions on hiring  the best geologists and the best scientists and buying the very best equipment to help them know where to drill.

Similarly, the very first thing you need to do, if you want the equivalent of an oil well in your front yard, is make sure, FIRST, that you are drilling in the right spot.  You need to KNOW that the company you are working with is fundamentally sound.  Without that, like tens of thousands of others, you will lose money, you will lose precious time, it may cost you your reputation, your friends, and even more life-threateningly, your cherished hopes and dreams.  I have seen it happen far too often.  It happened with “Jim,” which is what almost cost him his life.

Don’t let it happen to you.  First things first, know if you are drilling for oil in the right spot.

Trust me for now when I tell you, most people are drilling in the wrong spots for oil; most networkers are working with companies where they don’t have a prayer of creating reliable, long-term, leveraged, residual  income.  You will absolutely know why I say that before these 7 Days are over.

I will give you everything you need to know, just make sure you stick with me on this.

One last point before we adjourn until Day 3

If you are already in one of the very few good network marketing companies, are you sick of losing good people, prospects and organization members to the latest, flaky new start-up company where you know they will do nothing but get taken to the cleaners?

Encourage your organization to read and learn these principles as well, and you will keep them with you for a lifetime, not just a lunchtime.

Day 3 – tomorrow.  The topic…

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!

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


Lou Abbott's signature
Founder of the new…
MLM-theWholeTruth.com for people who want to know the up-to-date, whole truth about the industry.

“The credit belongs to the man in the arena, whose face is marred by dust and sweat and blood, who spends himself in a worthy cause, who strives valiantly, …who at best knows the high achievement of triumph, who at worst, fails while daring greatly for he knows his place shall never be with those cold and timid souls who know neither victory nor defeat.”–Theodore Roosevelt

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{ 4 comments… read them below or add one }

Sanjay Johari July 7, 2012 at 8:04 am Thumb up 0 Thumb down 0

This is very honest narration. Its better to know a hard truth than to follow a glorious lie. I am looking forward to know the ground realities of the trade and how you can turn it in your favor.

Thanks for sharing valuable information.

Sanjay Johari


Violet Ikahu May 1, 2012 at 12:23 am Thumb up 0 Thumb down 0

This is incredibly good information.I wish I HAD learned more from you earlier, but all is not lost.You are an honest gallant soldier and a worthy leader.
Thanks for taking time to mentor us.


Paul Kabui March 19, 2012 at 2:00 pm Thumb up 0 Thumb down 0

Dear Great man,

so far so good and promising,
know i can see the light of having a better future as walk with you these wonderful 7 days. i failed in the first networking company not because it was crushing but i did know these secrets.
know at 41 am seeing a fruitful leveraged residual income
Long live and coach many network marketers like me
thanks in advance



e_hasan48@yahoo.com January 15, 2012 at 6:29 am Thumb up 0 Thumb down 0

it’s seems very helpful to me. i think i can do my business better then ever after finishing 7 day.


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