10 Questions to Ask Before Joining a Multi-Level Marketing Company

by Tony Shays on March 17, 2012

Top 10 Questions to Ask

There are many great multi-level marketing companies in operation and some exceptional ones. Unfortunately, there are also some that give the industry a bad name. Therefore, you need to know what to look for before committing your time, money and dreams to an MLM company that will only give you heart ache.

Don’t let anyone try to rush you into making a decision. Take your time, do your due diligence and make sure you feel right about everything before signing on the dotted line. Don’t let all of the hype cloud your good judgment.

It is not enough to choose a great company. I recommend only the best companies, but this doesn’t assure that they will all be right for you. The secret is to find the company that stirs your passion and feels as though it was created and designed especially for you.

To find such a company you need to explore several areas, which I have defined using list of questions. The questions are in a useful order, although the order itself is not prerequisite in order for you to make a right decision. The following is my list of the top 10 questions to which you need to find answers:

#1 What is the product or service you are asked to promote?

Unless you believe in a product or service enough to want to buy and use it yourself, how can you promote it? Your passion has to start here. (In the future, when you read the word “product,” realize that in most cases this also includes “service.”) With all of the top MLM companies, this is the heart and soul of the business. This is what gives the company – your business – its longevity. The fact is that the biggest reason that many MLM companies fall apart is because there is no demand for the product. If you can get passionate about the product and feel that others will as well, then you are ready to ask the next question.

#2 How much does the product cost the consumer?

The product should be priced well enough so that it does not become an issue. You have enough to do in building an MLM business that you don’t want to have to spend your time trying to justify the price. When you are convinced that people will want the product and it is priced well, you can move on to the other questions.

#3 Who are the leaders of the company and what are their strengths?

The leadership of any company is important, but with MLM companies it plays an even more prominent role. In this case, at least one of the leaders is almost always the founder. They created the company. It is their mission statement and vision that sets the direction and tone of the company. Some important sub-questions to ask include: What did they do before leading this MLM? How did they come together as a team? What is their experience and reputation? Once you feel you can be proud of the leadership team and respect their judgment and decisions, you can move onto the next question.

#4 Does the MLM company seem financially sound?

A big reason that companies in general fail is that they are under-capitalized when they launch and/or they don’t have enough money in reserves to get them through their first two years. Learning this information may take some time and effort on your part, but remember that I am here to help you. Most companies are proud to disclose their financials, or at least part of them, to the public. It is when you can’t find anything about their finances that you should begin to worry.

#5 How long has the MLM company been in business?

90% of the MLM companies that go out of business do so within their first two years of operation. Therefore, as a general rule, it makes sense to wait until a company has celebrated its two year anniversary before joining them. It is important to note here, however, that if you are happy with all of the answers to the other questions, you may not want to wait. Sometimes it is good to get in on the ground floor, when a company is new and exciting. The actual age of the company is not as important as its growth. If it has been around a long time, just make sure that the growth trend line is still positive.

#6 Does the MLM company enjoy a positive reputation?

The company’s reputation should, of course, be important to you, since its credibility will impact your personal credibility. This also goes both ways. In your search for the company’s reputation, especially if you plan to do it online, I would like to issue a warning: Don’t believe everything you read! Unfortunately, many reviews are planted by competitors or individuals who have something else they are promoting. They can also are written by disgruntled associates who failed because they didn’t follow the “lesson plan.” Obviously, there are legitimate complaints as well, but it often takes thorough investigation to get to them.

#7 Are the marketing materials dynamic and accurate?

It is not your job to create your own marketing materials. They should be supplied by the company, and you should feel proud and confident to use them. They have to be eye catching, because of all of the competition that is out there. They also must clearly and honestly state all the benefits of the product, in addition to describing the other aspects of the business.

#8 Is there a WOW factor to the website and does it have a strong “back office?”

Today, every viable MLM company has a great website to attract customers, as well as people who want to build a team. The key to us is whether or not they have an up-to-date “back office” for those who want to build a large business. This is essential for tracking everything about your personal business, including monitoring how everyone on your team (your downline) is doing.

#9 What kind of support will the company give me?

Without support, the MLM business is very tough. The good news is that most MLM companies have a well thought-out marketing plan, as well as an action plan to promote both the product and to help you recruit independent distributors. Most MLM companies also offer extensive training, in addition to company-wide, regional and local events. The biggest breakdown in support usually has more to do with your sponsor – the person who introduced you to and enrolled you in the company – and the team that he or she is on. Some sponsors are new to the MLM system and have had no real experience in business world to offer. When this is the case, you need to find someone in your upline that can mentor you. Sometimes this seems nearly impossible. It should be noted that, regardless of the experience of your sponsor or those in your upline willing to help you, it really gets down to you and your own efforts. I know many network marketers who become highly successful with zero help from others.

#10 What is the compensation program and how does it work?

I put this question last, knowing full well that it is one of the most important issues to some. After all, MLM is a business. However, without receiving positive responses to the other nine questions, does the compensation program really matter? Don’t mistake us for thinking that how, when, and how much you are paid isn’t critical. It is extremely important and takes the most time to understand. It requires that you read the fine print of the agreement to get all of the facts before signing to join as a distributor. Misunderstanding the full compensation program causes more unhappiness than any other issue. Knowing this, Home Based Business Success Center has researched hundreds of MLM companies, paying particular attention to their compensation program. This has put us in a position to assist you in finding a company that meets your financial needs and goals.

Good luck in your search for the right MLM company for you. If you have any questions, leave a comment below.

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This article was written by Tony Shays. Tony is the founder of Home Based Business Success Center. He is an entrepreneur who has owned and operated 12 traditional small businesses and has also found success in several different home based multi-level marketing companies. In addition to running the Success Center, he is also a business coach.

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