Residual income is the lifeblood of MLM. In order to create predictable ongoing residual income, you need a product (or porducts) that people will use up and order again every month.
If you are mainly a consumer and joined your company to get a discount on the products, you can ignore this advice. If you want to make money over the long haul, heed it.
Nearly all MLM companies have good products but not all of them meet these criteria:
- Viable (in demand)
When considering if there is a demand for your product, you need to understand who would buy it. You want a thundering heard of potential customers. Someone recently told me they joined a MLM that sells silver and gold coins. While I am sure there is some demand, this seems like more of a luxury item to me. In a down economy, most people will not be able to afford luxuries; they need to eat and keep a roof over their heads! Even if you consider the coins an investment, you must have extra income to invest. Another person told me she is in a candle company but decided to build in a company that sells food for exactly this reason.
There are many products from MLM companies that people would consider luxury or collectible items. You need to consider what percentage of the population can actually afford them.
Another problem with collectibles is that they are not consumable. What I mean by consumable isn’t necessarily edible, but something that gets used up and must be reordered regularly. I have 2 drawers full of great kitchen gadgets that will never wear out and I have no room for any more. I have enough baskets and candles to cover every surface of my house. The reason that so many MLM companies sell nutritional products and skin care is that when people love the products, they will set up an autoship and never be without them. Even weight loss is fickle because people have a “diet mentality” and they don’t believe in staying on the products after they lose the weight.
If your product isn’t priced appropriately in comparison to the competition, you won’t get many customers. If you see a company’s products listed at a discount on eBay it is not a good sign!
When you have a truly unique product, there won’t be much competition. You still need to make sure it is affordable to a wide range of people. If people can afford the product, it adds value to their life, and you are the only one they know who has it, you have a home-run product!