How to Start a Multi-Level Marketing Company
A multi-level or network marketing company is a viable business alternative due to the potentially lucrative payment structure. You are paid for both your own retail sales and a percentage of the sales of those you have sponsored into the business and their recruits. Practically any product or line of products is sellable through multi-level marketing. Nutritional products are a popular choice as are more technical products like cell phones. Following are steps you can take to start your own multi-level marketing business.
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Things You'll Need
- Business opportunity magazines
- Wholesale supplier
- DBA registration
- Vendor's license
- Website
- Digital camera
- Business cards
- Fliers
- Catalogs
- Price lists
- Distributor's packet
Instructions
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Starting Your Multi-Level Marketing Company
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1
Purchase business opportunity magazines at the bookstore or grocery store newsstand. Study the types of products multi-level marketing companies are selling. Think about what products are in demand. Consider signing up with one of the multi-level marketing companies to get some experience before delving into your own venture.
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2
Decide on a product line. Search the Internet for a wholesale supplier for your chosen products. Find out which ones dropship or send to customers directly. That will spare you from having to carry large inventories. Select the one that offers dropshipping and the lowest unit cost, but make sure their delivery time is prompt enough for your needs.
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3
Choose a name for your business. Call the local county administration office and get registration forms for your DBA (doing business as name) and vendor's license. Fill out the forms, write a check for the vendor's license and mail the forms.
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4
Establish a retail price for your products. Mark them up enough so you can offer distributors 20 to 40 percent off. Decide how many levels deep you will pay your distributors and what percentage you will pay on each level. Go online, find a company specializing in multi-level payment systems and order their software.
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5
Design a website or hire a web developer. Take pictures of your products, or see if they are available through your wholesaler and write a summary for each product. Let the website developer know you will need self-replicating sites for distributors who sign up.
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6
Develop catalogs, price sheets and order forms. Create a distributor's packet that includes wholesale prices and price sheets, order forms and a business plan on how your people can best run their distributorships.
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7
Advertise your multi-level marketing business in business opportunity magazines and card decks. Run some classified ads in national newspapers such as USA Today or The Wall Street Journal. Place ads online through Google's Adsense program. Add your website to as many search engines as possible such as Google.com, Yahoo.com, Altavista.com and Lycos.com.
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Check with an attorney experienced in multi-level law to ensure your payment structure and business are legal.
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Tips & Warnings
It is best that you have some experience in telephone sales or marketing before starting a multi-level marketing company. You will primarily recruit long distance, so closing skills are essential. Also, if you are using a five-level payment structure, it is fairly common to pay 10 to 15 percent on the first level, two or three percent on the second level and one percent on the other three levels. This is called a matrix payment plan, very common in multi-level marketing.
References
Resources
- Photo Credit business woman. businesswoman. image by Kurhan from Fotolia.com
