MLM Solution to Unemployment - What do you think?

[Mama Typist]

Seriously, what do you guys think about the concept of home business being the answer for the millions of unemployed individuals in America?

I was recently doing some calculations. And I realized that if I direct 2 to 3 reps under every person in my iSaversNetwork downline (and nobody gets more than those 2 or 3 directly under them) that the income would be substantial and spread to a ton of people! What do you think about manually building teams that way?

Look forward to hearing your opinions.

[Yogi]

Unemployed people seem to be the WORST people to bring into an MLM business. They nearly always fail, for the same reasons they are unemployed. (That should bring out some letters).

[Yuliya Mironova]

Originally Posted by Mama Typist

Seriously, what do you guys think about the concept of home business being the answer for the millions of unemployed individuals in America?

I've never been to America and my understanding of the economic situation there (and all that it entails) is necessarily second-hand, however well and widely informed my sources of information are, so take anything I say under that disclaimer, please.

I have grave misgivings about this idea.

I (and hundreds of others involved in the same MLM as me, in Europe) have become extremely successful by concentrating to the exclusion of everything else, in my business-building efforts over the last 8 years, on showing my business opportunity only to business-minded people who are already actively looking for a business opportunity.

The current economic climate (in Europe, as well as in America) has been making that harder to do, because there are so many unemployed and underemployed people looking for additional income sources.

That makes "sorting people" increasingly difficult for us.

What always made us completely different from the "average MLM person" was our selectivity in whom we sponsored, worked with, spent time and energy on supporting, and so on. This led to our super-high retention-rates. It still does, but it's become harder for us because too many people are interested. We have too many leads from the same marketing efforts, and that's a problem for us. We have to put extra effort into not wasting our time sponsoring people who aren't still going to be there a year later.

We're doing what we can, both collectively and individually, to set the entry barrier a little higher. (I just wish we could persuade the company to increase the joining fee significantly, in the interests of protecting those people who really aren't ready to set up their own businesses. But we can't).

Without wishing to sound in any way judgmental about it, my distributorship is my business and I don't want people joining it who are "not quite going to get started" or "get started and find it's not for them". We can, generally, tell who those people are. And generally, unemployed people are very high risk to us (and to themselves, in MLM).

Of course, I'm generalizing.

Of course, there are unemployed people for whom MLM is a perfect solution.

But not very many of them, and they're hard to identify.

It seems to me to be quite inescapable that a significant proportion of those unemployed/underemployed people in something of a financial crisis (often through very little fault of their own) are not well placed to be setting up their own business. Many of them are not business-minded, self-motivating, highly organised people likely to be successful at setting up their own business.

At the best of times, there are far, far more business failures than business successes. In this sort of economy, that becomes overwhelming, and if you're not very careful whom you sponsor, your business expansion becomes self-defeating as you find yourself struggling just to maintain numbers.

In short, I suspect that setting up their own businesses isn't the answer for huge numbers of unemployed people.

I think it's a hugely laudable and enterprising idea, and would be wonderful if it came off, but on a societal level, I just don't see it having a lot of chance, I'm afraid.

Experience has taught us that from our perspective, unemployed people in a financial crisis (and these days, a lot of unemployed people are in a financial crisis!) are comparatively poor prospects. They do much worse than average at self-employment. Not because it's MLM, but because it's "self-employment" and "business management". And that means, of course, that from their perspective, it's not a great solution to anything.

Originally Posted by Yogi

Unemployed people seem to be the WORST people to bring into an MLM business. They nearly always fail, for the same reasons they are unemployed.

You've just summed up in a couple of little sentences- while I was typing - what (typically) took me 20 minutes to say. You're right!

[PatrickCHedges]

You will still need retail sales to bolster the incomes of the people on your team. I'm not sure exactly how iSavers works, but there has to be some money flowing in from outside the company for any business to be sustainable. So, if you are talking about filling your downline by placing unemployed people under each other, it's not going to work out.

Maybe I misunderstood something?

[Yuliya Mironova]

Originally Posted by PatrickCHedges

there has to be some money flowing in from outside the company for any business to be sustainable.

That's for sure.

In MLM, there have to be genuine retail sales to genuine retail customers for it even to be legal enough even to survive for the long-term.

I don't know what "iSavers" is, and I'm casting absolutely no aspersions at all, I hasten to add!!

[Yogi]

Originally Posted by Yuliya Mironova

You've just summed up in a couple of little sentences- while I was typing - what (typically) took me 20 minutes to say. You're right!

Usually I am on the other side of that equation.... :

[Mama Typist]

Okay, I think I understand what you guys are saying. Basically, in your view, unemployed people are generally bad business partners that you don't want in your downline because they won't help you grow the business.

But what I've been dreaming up is not needing them to grow the business. (By the way, I just want to note that with 10% unemployment rate right now, I really doubt they're all unemployed because they're unmotivated or bad business people. I actually know a few people who are super intelligent and hard working but got laid off because their company is suffering or who had their own small business and again just couldn't make it...not for lack of trying.)

Anyway, back to what I was trying to get at, if I were to manually send 2 to 3 people down under previous members, with 7 tiers of compensation, many, many people would be making far more than enough money to survive without having to know how to grow the business themselves.

Granted, the one glitch is that eventually there will be people at the very bottom that don't have a downline. But at that point it would just be a matter of finding enough people interested in the product that don't care about the business, right?

[Yuliya Mironova]

Originally Posted by Mama Typist

I really doubt they're all unemployed because they're unmotivated or bad business people. I actually know a few people who are super intelligent and hard working but got laid off because their company is suffering or who had their own small business and again just couldn't make it...not for lack of trying.

Indeed ... such things are always possible. I'm pleased to sponsor those people, when they come to me because they identify themselves as someone actively seeking a business opportunity. But I think you'll be the first to agree that they're a pretty small minority of "unemployed people", considered as a group, which was the group you specified in your original post?

Originally Posted by Mama Typist

if I were to manually send 2 to 3 people down under previous members, with 7 tiers of compensation, many, many people would be making far more than enough money to survive without having to know how to grow the business themselves.

And their incomes would be at the expense of people higher up the line who would otherwise be earning more. All companies have a fixed maximum commission that they can afford to pay out on sales of their products/services. You can re-arrange/re-divide it, sure. But you can't increase it. If wanting to re-arrange it, would you really necessarily want people who "don't know how to grow the business themselves" profiting from that? Just a question ...

Originally Posted by Mama Typist

the one glitch is that eventually there will be people at the very bottom that don't have a downline.

Glitch City.

Indeed.

Originally Posted by Mama Typist

But at that point it would just be a matter of finding enough people interested in the product that don't care about the business, right?

In a reputable, respectable MLM, it ought to be a matter of finding people interested in retailing the product at every stage. In MLM, nobody earns anything until a product is sold to a customer.

If you're including people who aren't actually doing anything at all in your downline (neither retailing products nor building the business), and they're getting payments each month, ask yourself where that money would have been going/staying instead, if you hadn't sponsored those people.

[Mama Typist]

Originally Posted by Yuliya Mironova

Indeed ... such things are always possible. I'm pleased to sponsor those people, when they come to me because they identify themselves as someone actively seeking a business opportunity. But I think you'll be the first to agree that they're a pretty small minority of "unemployed people", considered as a group, which was the group you specified in your original post?


And their incomes would be at the expense of people higher up the line who would otherwise be earning more. All companies have a fixed maximum commission that they can afford to pay out on sales of their products/services. You can re-arrange/re-divide it, sure. But you can't increase it. If wanting to re-arrange it, would you really necessarily want people who "don't know how to grow the business themselves" profiting from that? Just a question ...

Glitch City.

Indeed.


In a reputable, respectable MLM, it ought to be a matter of finding people interested in retailing the product at every stage. In MLM, nobody earns anything until a product is sold to a customer.

If you're including people who aren't actually doing anything at all in your downline (neither retailing products nor building the business), and they're getting payments each month, ask yourself where that money would have been going/staying instead, if you hadn't sponsored those people.

Yuliya, do you think it's wrong to want to spread money to people who need it, regardless of what they can do for you? Isn't it kind of sick that generally in MLM there's a handful of people who become millionaires and the majority of the rest get nothing?

[Yuliya Mironova]

Originally Posted by Mama Typist

Yuliya, do you think it's wrong to want to spread money to people who need it, regardless of what they can do for you?

Not at all. Ironically enough, it's actually exactly what I do, myself, with the bulk of my MLM income every month, which is why I like to have my downline full of business-minded people who are both motivated and able to build their own successful businesses.

Originally Posted by Mama Typist

Isn't it kind of sick that generally in MLM there's a handful of people who become millionaires and the majority of the rest get nothing?

That would be pretty sick, yes - but it isn't my own experience of MLM, at all. In any commercial activity, though, it's inevitable that there'll be gradations of success, and some failures. MLM is no different from any other form of "own business/self-employment" in that regard.

Those "poor people" to whom you feel this completely laudable and admirable generosity can be helped much more by building a successful business.

If you'll excuse my saying so, respectfully, I think you may have missed the point I was stumblingly trying to make above about whose money that would be instead if you didn't have an inactive network, not selling and not promoting, earning it.