The viability of the business model for MLM can again best be described by example.  However, before we get into the example please ask yourself a sincere question. What do realtors do when they become successful?  Yes I said realtors, folks who sell houses.

Let me tell you what the successful realtors do.  They go off and become their own real estate brokers and hire other realtor’s. Right?  Yes that’s exactly what they do when they become successful. 

So what happens to the broker who got them started and paid for them to get trained, shared his call ins, walk ins, advertising, leads, etc... with them?  Tell me what happens to that broker with that investment in that realtor when that realtor walks out and becomes their own broker?  When that realtor decides to leave and start their own brokerage does the broker who helped them get started in the business get anything for that?  Silly right?  Of course the broker doesn’t.  In fact that broker has effectively trained his/her COMPETITION hasn't he/she?  Is that what you call a good business model?  Of course not.  Would you want to take on all the overhead of an office, advertising and marketing, phones, computer systems, mailings, etc… and help realtors get trained and started only to have them go off on their own and become your competition after you trained them?  Foolish question right?  Of course you wouldn’t.  This is not a business model that I as a businessman prefer to become involved with.

But wait!  Why not have incentives for the realtor to succeed and become their own broker and then start their own office and at the same time have incentives for the broker to encourage that?  Why not compensate the original broker for helping a realtor become successful so that the original broker gets a small percentage from the business when a realtor they have trained becomes their own broker.  What if the original broker received an ongoing override (albeit a much smaller percentage) when that realtor becomes a broker?  Wouldn’t that be a true win-win situation?  It sure would.  Isn't that a much better business model?  You bet because it is one where everyone benefits and has a vested interest in helping others succeed? THAT’S MLM!

Network Marketing is the fairest system by far because the success or non-success you attain correlates directly to the contribution and effort you've applied, personally.  It's not based upon your position within the organization.  Best of all it creates a residual income stream.

What is Residual Income?

Residual income is income that you receive, month after month, due to an initial and sometimes one-time effort.

If you were going to do a one-time job, and you had two choices for getting paid, which of the following would you choose?

A) $500 one time paid up front

B) $20 per month for the rest of your life

Obviously, "B" is a much, much better deal. This, in essence, is a residual income.  In MLM if you are a qualified (most programs have their own qualification prerequisites), you can refer someone one time, then earn commissions on that referral every month they use the companies products or services, indefinitely! Network Marketing Works!