Traditional marketing involves moving a product through a hierarchy of middlemen from the manufacturer through a chain of jobbers, Distributors, wholesalers, retailers; etc .each of these middlemen earns a profit for handling the product and this ultimately pushes the product prices high, sometimes to astronomical levels.
In Network Marketing, also popularly known as MLM these middlemen are reduced. The functions are simplified. The product moves through a network of distributors directly to the end user the end result, great cost savings are realised by the parent company . The profits that normally go to the middlemen now available to the company are thereby shared instead by the distributors in the network – and these distributors are simply you and your Associates or your down liners!
In today’s world the challenging work place has demonstrated that there is no security in the traditional corporate structure and career path. Home based businesses provide a safe avenue for self employment. In the United States over 3,000 jobs are lost each day due to downsizing, automation and technological advancements mergers and takeovers etc. Millions of people will be out of work searching for the same kinds of jobs their former employers just eliminated, in another company that just hasn't yet streamlined. This is postponing the inevitable; In fact, 47 percent of the companies that made up the Fortune 500 in 1980 are no longer in operation today, which represents a net loss of more than five million jobs!
Technological advancements affect the work forces of entire industries. One example is the gramophone record business. In the 70’s and before1985, vinyl records supported a $24 billion a year industry. Today it is all but extinct, having been replaced by producers of audio cassettes which are rapidly being replaced by Compact Discs or CD’s,VCD, DVD etc’ .
The functions computers are capable to execute have caused substantive workforce to be declared redundant. Similarly, robots have taken over many jobs in the workplace in many assembly plants in Japan, China and many other areas. One robot can replace twenty human workers and extinguishes the need for companies to pay exorbitant amounts in employee benefits, traveling allowances, medical expenses and the like. Why? It’s commonly referred to as cost cutting.
Network Marketing as an home based business can provide a financial cushion of residual income to protect oneself from such events. A recent Wall Street Journal survey in the U.S found that 80 percent of the work force wants to own their own business and 40 percent surveyed would like to work at home. This is exactly what network marketing provides. People are searching for ways to build a future that develops leadership and provides a balance in their lives for their families and each other. In today’s Economic environment traumatised by corporate downsizing, lay offs, slow growth and business uncertainty; Home based business and in particular Network Marketing can offer supplemental income or a new, non traditional career path.
One world acclaimed investor, Businessman, self help author and motivational speaker of this century once said
"If i had to do it all over again, rather than build an old style type of business, I would have started building net work marketing business" quote by Robert T.Kiyosaki, Author of the classic Business School,
Rich Dad, Poor Dad"
Network Marketing as a channel of distribution, allows individuals to create a retail business of their own. The individuals can also build a network of distributors through recruiting or sponsoring, training and managing other representatives. (It is for these services that you are paid) These new distributors are then eligible to develop their own sales group. The sponsoring organisers are then paid commissions on the sales of those people they recruited or sponsored into their sales team. Network Marketing is the new way to financial freedom. You'll never create residual income and freedom from the traditional job. Even professionals are trading their time for money; if they are not seeing clients or patients, they are not getting paid. Most income is temporary and it is easy to determine if your income is temporary - just stop working for 90 days. If your income stops or slows down, then you know you have temporary income.
In Network Marketing, once you develop a solid network of sales representatives, each of them working individually and as a wholesome group you will create ongoing residual income,. This is like duplicating yourself through others. This can give you the freedom to do what you want whenever you want to do it.
Unlike in traditional business, career advancement in Network Marketing comes directly from helping to create success with those that you introduce to the company. Network Marketing is sharing information that results in product sales. People involve themselves because they want to finally be compensated for what their efforts are really worth. They're involved because somebody thought and cared enough about them to show them the awesome opportunity of network marketing. They get involved because they were ready to make a change. The main reason for the success of Network Marketing is that it is based on cooperation,
not competition. Network Marketing is about empowerment of the individual as well as the entire team. Team stands for
Together
Everyone
Achieves
More.
Conclusively, the 'Referral Marketing' industry is growing at a rapid rate. More and more companies are looking at it as a viable method of cutting costs. It has enabled a huge number of people to start earning substantial incomes with low financial investment and, therefore, low risk. However, it is not a 'lazy man's' way of making money. In order to build a successful business, like any business, one must invest a great deal of time and effort into it. Many people have 'fallen by the way side' because they have been misinformed (by over enthusiastic recruitment tactics) about the level of work that is required to generate a decent income.
As you enter into the Network Marketing business however, you will be amazed by the amount of support given to you by the parent company and the training systems available through telephone, internet, satellite, and live training workshops. It’s interesting how resistant we are to change. We want to stay in our comfort zones even when we're miserable. Whilst it’s been said that network marketing is the next step in the evolution of free enterprise, one thing we can always be assured of is, the most fundamental fact of life in our world today is that change is inevitable.