If you want to make money in sales without going through the process of finding your own products, network marketing is an alternative. In the network marketing business model, you promote another company’s products and make a commission on the sales you generate. In some cases, you also make a smaller commission on the sales of anyone you’ve brought on board as part of your team. Plenty of well-known brands have used this business model and achieved significant growth in doing so, including Avon, Mary Kay and Tupperware. Here are the pros and cons to help you decide if network marketing is right for you.
Easy to Start
There aren’t many barriers to entry with a network marketing business. Some companies let you sign up without paying anything, while others require you to at least purchase a starter kit with products you can sell or give away as samples. This is much less expensive than purchasing products wholesale or having a product manufactured, and the products you’re selling already have a recognizable brand name behind them.
You have quite a bit of flexibility in how you promote and sell the products. Common promotional techniques include social media marketing and face-to-face marketing, either by meeting with people one-on-one or throwing parties related to the products. You can spend money on your marketing if you want, or you can stick to free marketing methods.
You choose when and where you work with network marketing, which makes it a convenient side business. There are no minimum requirements regarding how many hours you work, although there can be minimum sales requirements to maintain a certain position in the company. You could spend 20 minutes per day on your business or turn it into a full-time job.
Sales Skills Are Required for Steady Income
Even though it’s easy to get started with network marketing, it takes time and dedication to generate full-time or even part-time income from your business. The income distribution in network marketing companies tends to be top-heavy, as you can see in the 2016 income disclosure statement for Rodan and Fields, a popular skincare company that uses network marketing.
Keep in mind, though, that another reason for this income distribution is that many people on the lower end when it comes to income only use network marketing as a side job. If you’re smart about promoting your business and growing your network, you can eventually build up to a solid income.
Lack of Control
All you do with network marketing is promote the company. You have no control over what the company does, and you’re tying your success to that company. If it has a crisis with its reputation, it’s likely going to affect your income. If the company decides to pull a product that your customers liked, there’s nothing you can do about it. Of course, working with that company can also benefit you, since the brand name can help you sell products.
If you want to give network marketing a try, find a product you’re passionate about and test it out by setting up a side business first. You may find it’s not for you, or you may find that you have a knack for it and decide to do it full-time.