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MLM, or Multi Level Marketing, when combined with the Internet, creates a powerful formula for building a successful home business and achieving financial freedom.

This business model is used by hundreds of companies to move their goods and services to the end consumer.  In this article, my goal is to provide you with information on what this industry IS and what it is NOT.

I want to give you everything you need to make an informed, educated decision about whether or not this business concept is right for you.

Simply put, MLM (as we’ll call it here) is simply a business model for moving products and services from the factory to the marketplace and using a multi level commission payout plan (that’s where the term “multi level” comes in)!  Another term commonly associated with MLM is Network Marketing due to the nature of the program members working together as a team.

Some people believe that Multi Level Marketing companies are nothing more than scams or illegal pyramid schemes.  However, for true MLM companies, nothing could be further from the truth.  These people simply do not understand how Multi Level Marketing companies work.

The first thing that you need to know is that MLM is not illegal and it is not a pyramid scheme.  While the organizational structure resembles a pyramid in shape, this is true of almost all businesses.  There are far more workers in the lower ranks of any business then at the top, if not, the business would collapse.  Not everyone in the company can be CEO or Vice President.  In fact, Multi Level Marketing companies are one hundred percent legal and many multi-million dollar companies use this business model to market their products.

Many Multi Level Marketing companies have been around for decades.  Some of the better known MLM companies are Shaklee, Tupperware, Mary Kay Cosmetics, Amway, A.L. Williams (Insurance), Princess House (a subsidiary of Colgate Palmolive), Melaleuca, MCI, U.S. Sprint, and NSA.

There are hundreds more MLM companies and just like other companies, some are good and some are not so good.  But MLM is certainly here to stay and it is an explosive growth field!  In fact, increasingly you will find more and more Fortune 500 companies employing the Network Marketing business model for some portion of their marketing portfolio!

So what’s the big attraction to MLM companies and programs?  Well, it represents a wonderful opportunity for the “little guy” to start his own business on a part time basis and make a whole lot of  money provided he or she is willing to put in some work!  This is not a get rich quick scheme and work is involved, no matter what some MLM recruiters would like you to believe.

John Paul Getty is often quoted as having said that he would always prefer earning 1% of a hundred peoples efforts than 100% of his own efforts.  And that is precisely what Multi Level Marketing is all about.  The Multi Level Marketing sales force members are not actually employees of the company, but instead they are independent distributors who are compensated for their efforts by commission based on the amount of product moved by not only themselves, but also by those whom they recruit as distributors.

What makes the business “multi level” is that each independent distributor can recruit other independent distributors to work under them and earn a wholesale commission on the amount products their recruited distributors move to consumers.  And this process can go on and on for some designated number of levels.  This chain of distributors is called a downline.

The more people a distributor can recruit for his downline, the larger will be their total commissions.  The number of levels that a distributor will earn override commissions on will depend upon the company’s compensation plan but five to seven or more levels is not unusual.  These wholesale override commissions can quickly add up for distributors with a large downline.

A strong incentive is thus created not only for a distributor to recruit more distributors for their downline, but also to train them to move products as well.  Thus a successful distributor will want to duplicate their success by teaching their downline members how to be successful.  By making their downline members successful, they make themselves more successful.

Those who can successfully recruit, train, and retain can create small fortunes and develop a large stable residual income that will support them for years to come.  Although not easy, it can be quite rewarding.

Millions of people are discovering the advantages of being their own boss and working from home with the MLM business model.  A basic computer, telephone, fax machine, a HUGE ambition, and the knowledge of how to proceed to grow your business are all it really takes!

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