A multilevel company is a company that follows a business model based on a network of collaborators who sell products in exchange for a commission. It is based on a network of merchants and collaborators who sell products in exchange for commissions, who in turn seek new distributors to grow the network.
The strategy used by this type of company is called multi-level marketing (MLM).
These types of business models are built from physical products freely sold by independent merchants. In addition to earning income from the sale of the company’s products, these merchants do so by building their own network of distributors of the company’s products, thus also earning a commission for each sale made by a seller in their network.
Thus, the aforementioned merchants who work for MLM companies have two main sources of income, their own sales and the commissions they receive from their collaborators.
The most experienced distributors are able to create a large network of dealers who can live off the passive income generated from commissions on the sales of the distribution network.
Without a doubt, this created a great incentive to recruit new distributors and expand the MLM network.
Key features of multilevel marketing
Key features of Multi-Level Marketing MLM include networking, flexible hours, and convenience.
The convenience of shopping is another powerful feature of MLM. In general, MLMs support online shopping, and sometimes even networks make the buying process easy. Distributors travel to customers’ homes, workplaces, or any convenient location for buyers and sellers.
The network is the backbone of MLM. Word of mouth and trust play a big role in internet marketing success.
The process consists of generating confidence in the product offered among the clients contacted, which generates a favorable impact, and the clients in turn recommend said product to their acquaintances, forming a kind of snowball.
One of the positive aspects of this model is flexibility. The MLM distributor can determine what time of day he will spend selling his product or attracting more customers to the network.
This flexibility includes the ability to work from home, monitor your distributor’s activity, and only come into the office for group meetings or specific business-related events.
For entrepreneurs who intend to start a multilevel business, the initial capital is usually very small, but in any case, it is always important to measure the investment possibilities in relation to the returns that can be obtained.
Keep in mind that not everyone you recruit will stick around, and only a small percentage may earn you income. caution.
The MLM business can be very lucrative but it will not be successful in the short term, it is a process of months or even years, if you do it with dedication and perseverance, do not doubt that it will bear fruit.