Important facts you should know!
Like many truly innovative breakthroughs, the development of true Network Marketing was an accident. Network Marketing is around 60 years old. Carl Rehnborg was known to be the first person to introduce a compensation plan to market his nutritional products way back in 1945, after realizing that, all their new sales representatives coming aboard were friends and family members of their existing sales force and primarily because they wanted the product at wholesale prices. His company was originally called the California Vitamin Company but later renamed as Nutrilite Products Inc. By using a multi-tired plan, it allowed any Nutrilite distributor to get a 3 percent commission from a downline on top of the regular commissions from their own Sales. With this system, Nutrilite achieved stunning success compared to the old "direct-selling" method. They also discovered that it was easier to create a sales force of a lot of people who each sold a small amount of product than it was to find a few superstars selling a huge volume of products. So they designed a sales compensation structure that encouraged their salespeople to invite new representatives from satisfied customers, most of whom were family and friends, who each had the same right to offer the product and representative status to others. This allowed the sales force to grow exponentially and in return, the company rewarded them for the sales volume produced by their entire group or network of sales representatives and thus Network Marketing was born!
In 1956, Nutrilite was joined in Network Marketing by Dr. Forrest Shaklee to gain a broader distribution of the food supplements he helped develop. In 1959, two good friends - Rich DeVos and Jay Van Andel - started a new company called Amway Corporation selling biodegradable all-purpose cleaners and vitamin supplements. Using an improved compensation plan, the tiny enterprise achieved remarkable success with a sales force of independent distributors from all over the United States. DeVos and Van Andel had earlier made a fortune from working as distributors, withNutrilite. After breaking away from Nutrilite they were convinced they could do better on their own marketing their own products. Today, Amway is one of the leading network marketing companies in the world. Others have come into paly lately incude the Chinese food supplements and beauty products giant Tiens (pronounced Tianshi)
During the early 80's they (Tiens) fully embraced Network Marketing is also known as Multi-Level-Marketing (MLM) or Referral Marketing as their business model and as a result, witnessed the fastest growth ever experienced in history, with millions of distributors joining hands with it world over . Although the business concept has been around since the early part of the last century, for many people, it is still unfamiliar territory. It is a good way of starting a profitable, full-time business with little investment capital. It is also a good method of starting a second or part-time business to run alongside your existing business, career or lifestyle.
In most cases it involves selling a product or service which is produced and supplied by a 'mother' company. You take on the responsibilities of selling the products and introducing other people to the company. You get paid commission on the products / services sold by yourself and a smaller commission on the products / services sold by the people you have introduced to the company. In addition to this, you often get a percentage commission based on the sales of the people who- 'the people you introduced'- introduced... and so on…..and so
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