Friday, December 14, 2007

MLM Business: Why It's Best to Avoid "Jumping The Gun"?

If you are a professional network marketer and building your mlm business online, I am sure you have seen and received many offers to join a pre-launch network marketing company.

Many times, the offers and packages seem incredible and you are given the impression you would be crazy if you didn't join. However, the last thing you want to do is to "jump the gun" and get in on the deal. Here is why you must never overlook "timing in the company and timing in the industry.

You see, did you know that over 90% of start up companies don't last over two years? Start up companies have to go through growing pains. They have to work through software problems, and make sure their overall systems are up and running smoothly. If it really is a great mlm business opportunity, it should be ten times better after the two years are up. Then, if you are still inclined, you can join without having to worry about the business folding.

Let me give you a real life example of why this "timing in the company and timing in the industry" principle is so important. A number of years ago, there was a company called Excel. Excel came about after the federal government deregulated long distance here in the USA. This gave more companies the opportunity to get in business. These companies were really just reseller's of long distance packages. Excel happened to be one of them.

What happened with Excel is that all of the people who joined in the first two years didn't make it. This is because the three main telephone companies weren't that cooperative in letting go of their customers. Excel had to go through litigation until finally customers who desired were able to switch to Excel. So, as you can imagine, nobody who was a distributor was making money at this time.

Next, what happened was that Excel started to get lots of competition from other reseller companies who came in on the scene. Everyone bought time from the three big companies wholesale and then sold it retail to customers. So, the market became saturated.

Then, the dawn of what I call the "flat rate" arrived. People could pay a flat rate for their phone service, TV, and cable, internet, etc. and not to have to worry about having outrageous phone bills. This caused the reseller companies like Excel to have no margins left for profit. I am sure you can think of other companies that have gone through this. There are lots of things that used to cost loads of money, but now can be bought very cheaply, or in some cases, for free. Look at how much the cost of computers have gone down!

The above story is an example of what can happen to a mlm business. So, it is important for you as a distributor to carefully consider if you want to take a gamble and join a pre-launch company. Remember that if it is a solid opportunity, it still should be going strong after two years. This is why it is best to not "jump the gun"!