Why Are You Losing Money in Your MLM?
Are you actively marketing a product for an MLM company? Are you making more than several hundred dollars per month with this MLM? Are you doing EVERYTHING your sponsor is telling you to do but still losing money?
Unfortunately, this situation may have nothing to do with you. Your sponsor doesn’t understand this or even how to explain this issue to you. Fortunately, this issue is easily explained … if you understand basic mathematics.
Mathematics?
Yes, this is a quite simple math problem. You see, in any sales business, you get paid based on the quantity of products that you sell. The more of your product that you sell, the more money that you make. Quite simple. Unfortunately, there is a huge second factor that enters into this equation that will impact your total income, especially if you are running your own business.
This factor is the amount of money you earn per transaction. You are probably saying that this won’t make THAT much difference, will it? Yes, the difference in the amount that you earn per transaction will make a tremendous difference in your income. The example below will show the graphic difference. This will be a simple example but has real world implications.
First, some base information. Typically, one percent (1%) of your prospects will purchase your product or service. In addition to this, only about one percent (1%) of the people that read you ad will respond to it. Then you get to the real kicker, only one percent (1%) of the people that see your ad will even bother to read it.
So, here are the numbers. You need one hundred (100) prospects to get a customer. To get the one hundred prospects, you will need to have ten thousand (100 X 100) people to read the ad. Now for the scary number. You need one million (1,000,000) views to get your single customer.
So, by now, you are probably asking what this has to do with anything. PLENTY.
For instance, say you earn ten dollars ($10.00) per sale. For your one million views you just made ten dollars. Do this ten times per month and you just made one hundred ($100) dollars. CONGRATULATIONS. In five months you are broke and your business is probably on life support or worse.
OK, say you bought into a better system and you are making one hundred ($100.00) per sale. You are doing better because you have now made one thousand ($1,000.00). This means that you will struggle for a YEAR and then probably still bail out because your effort is not being rewarded the way that you think it SHOULD be.
Now, what if you were to join a large dollar program? Say you could earn one thousand dollars ($1,000.00) per sale. This would put ten thousand ($10,000.00) in your pocket for ten sales. NOW YOU ARE TALKING. Now you have a business with enough income to allow you to grow your business to a level that is sustainable.
Unfortunately, too many people join the small dollar programs and then complain that they can’t make any money…AND…they are correct. The odds are greatly stacked against them. Now if you are looking for pocket money, yes, a small dollar program will fulfill your needs. If, however, you are looking to put some decent money in you pocket, a small dollar program will drive you out of the business.
So, what do you do?
My suggestion is quite simple. Visit: http://www.Millionaire-Marketing-Plan.com/?t=wp to see the strategies and techniques that I learned to make my business profitable.
Tagged with: AMWAY • Attraction marketing • Dillard • Fanale • Kubassek • make money at home • make money from home • makemoneyathome • makemoneyfromhome • Millionaire-Marketing-Plan • MillionaireMarketingPlan • mlm • mlm company • mlm marketing • mlmintegritymarketing • MonaVie • network marketing
Filed under: Marketing Mindset
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This series of manuals and videos teaches you the secrets of mastering the Adwords/Clickbank profit generator. Even the newest marketers can make serious cash with this system!
upfront, large sum cash flow. I like how that sounds. Plus tag that together with a typical residual income and you should be off to the races my friend.
I can certainly tell you were an engineer going through those numbers and crunching them like you did
Hey Bill, that is the sad fact of this industry. You must be talking about having success in a “top tiered” program where the cost of the product is greater, so the income chances are obviously greater too. This sounds like a great idea to me.
Thanks,
Kathy
Bill,
Being a business owner I love making more margin per sale. Great article!
There is an old saying i learned in the insurance business and that is “figures don’t lie, liers figure”. This is a great way to get paid and not wait years for renewals to accumulate.
Thanks for the great post Bill,
~Bert
Bill you have hit a very key point here that most people do not realize and is it is just simple math. More importantly you need to know these number to find a program that will work for you.
Good stuff. Everyone needs to know this.
Bob
Hey Bill,
When you explain the metrics this way it makes perfect sense. It really is simple math and people need to understand this. If you know these metrics you can tweak and track to see if you are making any progress in your business.
- Yo
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