Multilevel marketing, or network marketing as it’s also called, has been a popular medium for doing business for the past twenty years.  The past two decades has seen explosive growth in the MLM industry, and more companies are joining the fray and promoting their products and services.  However, there are a number of misleading facts and claims about MLM, and budding home-based entrepreneur should be wary of these claims.

What are the common misleading facts about MLM?

A number of misleading facts have sprung out regarding MLM.  And although you may have not yet fallen prey to these unfounded claims yet, it would be better if you arm yourself with the knowledge of these fraudulent assertions.  Here are some of the famous misleading claims about MLM.

1. MLM is a get-rich quick scheme

Some people are quick to assert that with multilevel marketing, getting rich is easy, because there are magic overnight success pills for you to follow.  In truth, MLM is all hard work and determination.  There’s absolutely no magic pill for success.  To succeed in MLM, you need to get the right training and coaching from MLM experts.  You also need to devote a considerable amount of time and effort to managing your business, tracking your leads, submitting content and keyword-rich articles and blogs, as well as employ useful strategies like search engine optimization (SEO), and other helpful Web 2.0 technologies.

2. You don’t need any startup capital to join

While some say that you can absolutely join network marketing for free, the truth is you still need to spend a considerable amount to join a certain MLM company.  Although most MLM companies only charge relatively low startup fees and charges, nothing actually comes for free.

3. Once you join, all you do is sit and watch your profits come

A lot of people still think that once they join MLM, all they need to do is sit down, relax, stare at the television, and wait for their profits to come knocking.  MLM is never for the lazy couch-potato types.  Here, you need to devote a considerable amount of time and effort towards letting your business grow.  You need to target the right set of prospects for your sales team, and you also need to train or coach them well, so they become motivated members of your MLM organization.

5. MLM is one big pyramid scam

While veteran MLM managers and distributors agree that the early days of MLM was fraught with fly-by-night companies and pyramid, Ponzi-like entities, the MLM companies of today are legitimate, and are registered with regulatory agencies such as the Better Business Bureau (BBB).  And although a few rip-off artists remain, overall the MLM industry is a thriving and credible one.

6. You need to pander your relatives and family to buy your products

Some pessimists also keep stressing that with undertaking an MLM campaign, the first thing that you should do is ask, or sometimes harass your friends and family to buy your products.  Well, that may be a bit true.  However, new technologies have erased that negative stigma about MLM, because now you’ve got useful tools such as automated lead generation systems to quicken your lead generation efforts.  More improved Web 2.0 technologies allow for a better way of targeting more leads, and for attracting more customers.

7. MLM’s compensation schemes don’t earn you any money

There are a number of popular MLM compensation plans.  These include the Stairstep Breakaway, Binary and Unilevel plans.  These plans have their own legs and layouts, and each offers a different way for managing down-lines, as well as for generating commissions.

8. You’ll spend more money than you’ll ever make

While this saying may ring true for those who continue to implement “old school” techniques, the newer and more cutting-edge techniques and technologies allow for a better and more streamlined management of your network marketing business.  MLM is a profitable endeavor, yet you need to know that it’s also a very competitive industry.  However, with a lot of effort and determination, you’ll be sure to earn more than what you actually spend.

9. You can succeed in MLM without any training

Some think that MLM is an easy business endeavor, and you can succeed without having any formal training.  MLM is a very competitive environment, and without getting the right training and mentoring, it would be like you’re going to battle and bring nothing but your bare hands.

10.  MLM is a dying industry

Is the sun actually setting on MLM? Well, see for yourself.  Would you call MLM a dying industry, when the truth is that in the past 10 years, the industry has grown by leaps and bounds, and has also generated billions in revenues.  In fact, more and more companies are joining the fray, and are boldly betting their investments on this lucrative sector.

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