How To Choose A Good MLM Company - 14 Things To Consider

How to choose a good mlm company

So you’ve found a network marketing company, but you are not sure if it is the right company for you.

I’m glad that you’ve found this article because I will be sharing with you 14 indicators to help you determine if it is a good MLM company.

In case you are still wondering if network marketing is the right business opportunity for you, I'd advise that you read this article.

You must understand that choosing the right MLM company is only the first step to success.

Many other factors will determine your success as a network marketer.

So, without further ado, here are 14 factors that will help you choose a Good MLM Company...

#1 Do You Love The MLM Company's Products?

How to Choose a Good MLM Company - Did the products work

This is probably the first and most important question you have to ask yourself before joining the network marketing company.

If the products don’t work for you, how do you expect others to be convinced, right?

Although I know that you can fake an experience, and claim that the products work.

But, I feel that it is just unethical to do it, and your sales pitch may not sound as genuine.

Chances are, if the products work for you, it may work for many others as well.

And, this creates customer satisfaction and retention.

So, before you join the network marketing company, make sure you have positive experience with the products.

Do not join because of the hype, and do not be swayed by the “income potential” that most Network Marketing company flaunts.

BareNakedScam - Jack Cao 1

Hey there, I'm Jack!

If you have been struggling to make money online, I am sure you can resonate with my story. This is my story on how I build my online business from the ground up, and how it eventually allowed me to  fire my boss and earn a full-time income online.

#2 Are the Products Unique To The Market?

How to Choose a Good MLM Company - Unique ProductsNot only it needs to be unique to your country, it has to be quite in the world.

Having a unique product is first and one of the main factors that draws people into the network marketing company.

Without a unique product or service, the company is just like the thousands of companies in the world selling the same thing.

You will just be like a small fish in a big ocean, struggling with competition, and 99% of the time the distributors will fail, and the company as well.

My personal experience with “Unique” products

I remember I was once sold to an MLM company that sells a soap bar made from the sacred stones from Jeju.

I also came across an MLM company that sells Posturepedic mattresses.

Those products seemed to be unique at that time, but when big name companies came into the picture, like innisfree (a company that sells Jeju produced cosmetics) and Sealy (a company that sells posturepedic mattresses), the MLM companies went out of business, so did their distributors.

So, before you take the leap of faith to join the MLM company, take a step back and think long term.

Also, make sure that you do some research on the related industry the MLM company is in.

#3 Does the Products Have Retail Value?

Let’s be honest, if the products have no retail value, the company could be running a pyramid scheme.

If you want to know the big difference between a legitimate MLM company and a pyramid scheme, you should read this article.

Every product or service on the market exist to solve a problem or issue, or to make your life much easier.

So, with that in mind, does the products of the MLM company helps you in your daily life?

Whether it is to help you sleep better, to make you look younger, or to make you feel healthier, the products of your company must exist for a purpose.

You might think that this sound silly because it is quite obvious, but you’d be surprised.

Some companies like Digital Altitude and MOBE are already caught as a pyramid scheme…

Especially those companies that creates online training programs as their core products.

Their products tend to favor teaching how to recruit people into the MLM opportunity.

The only thing that entices people to join the company is the big fat checks that they issue to their successful distributors.

So, before you join the network marketing company, ask yourself, will you use the products for a long term?

#4 Does It Cost You Anything To Join?

How to Choose a Good MLM Company - Is it expensive

Ask yourself, would you spend thousands or even tens of thousands of dollars just to make it back in the future?

Here’s the catch, some companies priced their products or the business opportunity so highly that they probably ask you to take a loan just to join them.

Don’t be fooled!

The price of the products can only be expensive because of the uniqueness and effectiveness.

It shouldn’t be overpriced just so that the distributors can profit from it.

Think about what you are paying for…

If a company is asking for a small amount of money in return for getting you all the marketing materials and have access to the back office. That’s fine.

But, when a company ask you to pay hundreds or thousands of dollars just so that you can “qualify” to own the license and earn commissions from the high ticket product that you buy, you should be on high alert.

Good MLM companies genuinely want you to promote their products, so they ask for a little money to cover their admin expenses.

So, make sure you know what you are paying for to join the business, if you are not sure, ask your direct sponsor, and if you still can’t find answers, avoid the business entirely.

BareNakedScam - Jack Cao 1

Hey there, I'm Jack!

If you have been struggling to make money online, I am sure you can resonate with my story. This is my story on how I build my online business from the ground up, and how it eventually allowed me to  fire my boss and earn a full-time income online.

#5 Track Record - How Long Has The Company Been Around?

Network Marketing companies come and go almost every day.

Statistic shows that 90% of new start up companies fail.

So, if you intend to join a network marketing business for a long haul, it would be wise to join one with a good track record.

Choose a company that has stood the test of time.

A good indicator is that a company has been around for more than 5 years, and it is still growing strongly.

What I mean is that a company that is growing in annual sales, and has little to no debt.

A good network marketing company will always have the extra cash to grow their business.

Be it for research and launching of new products, maintaining the infrastructure and obviously, to pay your commissions.

#6 How Good Is The Leadership Of The Company?

How to Choose a Good MLM Company - Good Leadership

It is common sense that we should not join a company with shady leaders.

But, many of us still make this same mistake.

Of course, we do not want to join leaders who always build and shuts companies.

And, we do not want to be in a company that re-brands itself regularly.

What we are looking for is a steady and firm leadership.

One that stood the test of time

Good leadership means a lot to a network marketing company.

It boosts confidence to its distributors and customers.

The customer retention and sales conversion rate are usually higher, and the return rate gets lower.

Good leadership leads to company growth that leads to a better brand.

Distributors will benefit the most, if a company has a good branding proposition.

So, be sure to do some due diligence on the company’s leadership.

#7 Does The Company Encourage Marketing Automation?

How to Choose a Good MLM Company - Marketing AutomationIs the MLM Company still stuck in the old days where all communications lies between the distributor and the customer?

Nowadays, there are so many online tools that we can use to help with the customer experience.

Although it is always good to pick up the phone to follow up with your prospects…

There are ways that a company can help to build the bridge between your prospects and you.

This can be achieved by marketing automation.

Before You Join the Network Marketing Company…

It is always a good practice to study your personal experience as a customer ,that eventually lead you to your decision to join as a distributor.

What makes you want to join the company? Was it really because of the products? Or was it solely because of your sponsor?

Or could it be that the company gives you some kind of assurance through a series of emails and follow up messages?

These are the things you want to assess because eventually your customers will experience the same thing.

What I suggest you do is to go through all the past communications between the company, your sponsor and you.

You want to know if the company is providing good automated marketing support to help you as a distributor.

#8 What Training And Support Does The Company Provide?

How to Choose a Good MLM Company - Good Training and Support90% of the Network Marketing Companies are still stuck in the past.

They still believe that prospecting through your social network is the best way to get results.

Unfortunately, that’s not the case!

The odds are stacked against you even before you start your network marketing business.

In the past, information was scarce before the invention of a smart phone.

People have less avenues to search for reviews and reports on a product or a business opportunity.

And, the only way to know if the product or the business opportunity works, is to personally experience it.

The MLM and Network Marketing Paradigm has shifted…

Now, with all the information in the world available with just a tab on a screen, the entire Network Marketing paradigm shifted.

Your prospects will most likely see scam reports or complaints about your MLM company, and the negativity sets in even before you start pitching your products.

So, it is really important that the MLM company embraces this fact, and provide training and support to help its distributors find their prospects online.

Instead of banging their hopes on their friends and family members.

But, what if you are already with an MLM company and it doesn’t provide the new age training?

Well, honestly, I’ve searched through the internet over the years, and I recently found that there are only a few quality training programs that streamline the entire Network Marketing training.

So now, instead of relying on your sponsor or the company for training and support (which don’t usually work)…

You can now learn and mingle around the best network marketers in the world with this program.

BareNakedScam - Jack Cao 1

Hey there, I'm Jack!

If you have been struggling to make money online, I am sure you can resonate with my story. This is my story on how I build my online business from the ground up, and how it eventually allowed me to  fire my boss and earn a full-time income online.

#9 Does The Company Restrict You From Promoting The Products Online?

Like I’ve said earlier, 90% of the MLM companies are still stuck in the past.

So, they have certain restrictions on their terms and conditions that will stop you from reaching out to people online.

They will also slam you with copyright or trademark issues if you use their marketing materials freely online.

So, before you join any MLM companies, make sure that you study their terms and conditions.

#10 Does The Company Rely On You For Customer Support?

How to Choose a Good MLM Company - Rely on you for support

So, you are trying to grow your network marketing business, but your existing customers are holding you back.

And, your MLM Company isn’t doing anything to help.

In fact, the company relies on you to solve all of their customers’ issues.

  • The products don’t work!
  • It’s broken!
  • I want a refund!
  • I haven’t received my products yet!

These are the common issues that customers face.

And, if your customers are not getting any support from the company, they come back to you.

Why the MLM company support is so important?

The quality of the products and the reliability of the product distribution plays a part to reduce the number of customer issues.

But, if the company’s customer support team is not doing their job properly, you as the distributor, will face the consequences.

Firstly, your relationship with your existing customers will be at stake.

Secondly, as the number of support tickets grows, you will find it hard to manage.

And, as you neglect some customers, the relationship may be tarnished as well.

So, before you join a network marketing company, make sure that you understand your roles as a distributor.

Do not join a company that relies heavily on you for customer support.

#11 Does The Company Competes With You For Sales?

How to Choose a Good MLM Company - CompetitionIts kind of ironic, don’t you think?

While you are helping an MLM company promote their products, the company competes with you for more sales.

You see, the very existence of an MLM company is because they want to avoid paying hefty fees on advertising and the shelving of their products.

And, what is the point of having distributors when the company’s products are sold in stores?

Just imagine yourself as a customer…

Imagine you are a customer who’ve just bought products off a distributor, and you found that you can actually buy the products in your local supermarket.

Would you go back to your distributor to order your next product shipment, or would you rather buy it from the store?

I know I would choose the latter.

I know quite a few MLM companies that does what I’ve described, but I am not going to expose them here.

So, before you start promoting any products of an MLM company, make sure that the products are sold elusively through you, as a distributor.

#12 Does The Company Require You To Buy Inventory?

This requirement should have been phased out, because the eCommerce industry has evolved.

There is really no need for any distributors to buy inventory for resale.

Nowadays, most MLM companies provide their distributors with their unique links and website.

With that, the distributors can share their links with the prospects, and when there is a sale through those links, the company will ship the products directly to the customers.

Distributors no longer need to be involved in the supply chain of the company.

Unfortunately, there are still MLM companies that require their distributors to buy inventory for resale.

A Buy Back Guarantee Scheme still valid?

Although some companies have a buy back guarantee scheme, I still find it inappropriate…

Failed distributors will most likely skip the refund process because…

  1. the refund process is tedious and confusing;
  2. they are not aware that such a buy back policy is in place;
  3. they blame themselves for the lack of ability to sell the products;
  4. and many other reasons…

So, just beware of this fact before you join the company.

#13 Do You Get Paid Immediately For Selling A Product Successfully?

You’ve made a sale! But, will you be paid?

You’d be surprised that some MLM companies require you to work through their compensation plan.

And, they only pay you on the 3rd or 4th sale.

Or, if you’ve recruited a number of distributors.

While these types of compensation plan are rare these days (because of the introduction of the Federal Trade Commission (FTC)), they still exist.

So, if you ever encounter a company that only rewards you after you’ve “worked through” their compensation plan, I’d advise that you stay away.

A legitimate MLM company will pay its distributors as long as they’ve made a sale.

Whether it is a sale of a product or a successful recruitment, the company should pay no matter how small the sale is.

BareNakedScam - Jack Cao 1

Hey there, I'm Jack!

If you have been struggling to make money online, I am sure you can resonate with my story. This is my story on how I build my online business from the ground up, and how it eventually allowed me to  fire my boss and earn a full-time income online.

#14 How Does The Compensation Plan Look Like?

How to Choose a Good MLM Company - Good Comp PlanThe Compensation plan should be the last thing that you consider.

But, to the majority of the people, the compensation plan is the one and only factor they consider.

Yes, although it is important to know how you get paid, but if you don’t consider the factors I’ve mentioned above…

What chance do you have to actually benefit from the compensation plan?

No matter how generous the pay plan is, if the odds are stacked against you, it is unlikely that you will actually earn anything.

Now, the compensation plan, when all else is a good to go.

Every company is claiming that their Compensation plan is the best…

You must know that there is no single best compensation plan in the network marketing industry.

Most MLM companies use a combination of the different compensation plans like Unilevel, Binary, Matrix, etc.

So, there are really no unique compensation plans out there, even though every company claims that theirs is the best.

What is important, is that the compensation plans should be easy to understand, and one that makes sense.

Do not join a company because their compensation plan is so unique and complex.

Some plans are made out to confuse you because most of the time people don’t actually benefit from it.

Make sure you understand the compensation plan thoroughly before you join the network marketing company.

If you have a hard time understanding the jargon of this industry, like the overrides, downlines or whatever, I suggest that you read this article.

Final Word

There you have it, the 14 ways to identify if the network marketing company is good.

If you have any other factors that is not found in this article, I hope that you can share it in the comments section below.

Thank you so much for reading this article. I hope you enjoyed it as much as I’ve enjoyed writing it.

Feel free to like and share this article if it has done a service to you.

Your pal,

Jack

My Secret to Online Sucess

About the Author

Jay is a scam buster who have objectively exposed hundreds of business opportunities.

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