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My latest distraction: Multi-Level Marketing Companies. Are they beneficial to their consultants or not? And should I buy from them?

A month ago I accompanied a friend of mine to a “LuLaRoe Shopping Bash.” I wasn’t really sure about anything other than it was a consultant driven clothing company that had soft leggings. I had sold Pampered Chef for a few months to make some extra money about 6 years ago. I told my friend, semi-jokingly, “Don’t let me buy anything and don’t let me sign up to sell it.” She responded,  “Oh don’t worry, it takes $5,000 to become a consultant. It’s not like you can just jump in.” Well I was shocked. $5,000?! That’s no small chunk of change.

It peaked my interest. You see, before I had signed up with The Pampered Chef, I did a little bit of reading on Multi-Level Marketing just to ensure I wasn’t involving myself in some scheme. I had read something that said not to trust anything that asked for more than around $100 for start up. Now at the time I didn’t think much about it, but I remembered it as soon as I heard the whopping 5,000 number that dropped from my friend’s lips.

Well I didn’t buy anything, but I was concerned. SHOULD I buy? Should I avoid it like the plague in hopes that women aren’t going in to debt for this company? My next thought was that the women doing it are receiving direct pay outs from customers. I worked for $8/hour retail. I was selling items to customers and my pay scale was not impacted at all. Did I earn some discounts? Yes. Usually these only encouraged me to shop there. Did I have any say as to hours worked? Not really. If I wanted to earn that $8/hour, I pretty much did it on their terms. That’s fine when you don’t have children. Having small children at home and a working husband complicates it to say the least.

So, the next step in addressing this question is to head to the library, of course!

My Money-Related Reading List

Love Your Life, Not Theirs by Rachel Cruze

This book by Rachel Cruze is not directly related to multi-level marketing companies. I did include it because I was reading it in order to review it: A Brief Book Review: Rachel Cruze’s Love Your Life, Not Theirs. I found it extremely beneficial while I’m in this mindset. If I could go back in time and read this book in my early twenties it would serve me well. Cruze writes with honesty and urges her readers to assess and plan their lives. She’s right. She’s helpful.

Rachel Cruze Love Your Life Not Theirs

The Everything Start Your Own Business Book by Judith Harrington

I didn’t love this one. I’m sure there are helpful things in it. It just didn’t speak to me.

Money Making Mom by Crystal Paine

GOLD. Loved this one. It’s interesting and she writes well. In no time I was a quarter into the book. She highlights the positives about MLM companies (low risk, access to training), while encouraging readers to assess their own strengths.

Also Paine has a blog where she lists some business books to check out: MoneySavingMom.com 7 Must read books for work at home moms

Making Money from Home by Donna Partow

This one is interesting. She’s encouraging. Helpful. Not my favorite. She does really highlight the benefits of MLM companies for women. This is a changed position as she writes that she at one time was skeptical of this business format. Now she sees it as a legitimate option.

EntreLeadership by Dave Ramsey

I have not finished this, but I hope to. Interesting and good. Dave Ramsey is such a force in the financial world.

Mom, Incorporated by Aliza Sherman and Danielle Elliott Smith

Interesting, but not my favorite.

The Everything Guide to Network Marketing by Esther Spina

Some helpful things in here. I would say this is more of a book to be pillaged.

Basic Things I learned

  • Consultants CAN make money, it takes work.

    • What I mean by work: time, effort, PLANNING, math, research, and willingness to learn.
    • In the above mentioned book, Paine recommended reading 8-10 books on starting a business. 8-10! They give consultants a lot of info. They do. BUT if you want to really succeed it’s going to take more. Like anything, you have to put the work in.
    • If you’re happy to just make a little money, you can do that too. Again you will still need to be intentional. You don’t want to overspend on business materials or underpay yourself.
    • Bottom line: You will not fall into money by becoming a consultant. You will not suddenly stumble into success. In purchasing a kit you are buying POTENTIAL, not SUCCESS.
    • Thirty One Gifts is a company that is a member of the direct selling association and they have an income disclosure on their website. It shows that the majority of consultants don’t make a lot, but some do. It’s here: Thirty One Gifts income disclosure 2015
  • By purchasing products from a consultant, you are paying the consultant.

    • HOW COOL IS THAT?! She is making probably 20-30% of the purchase. When you buy a shirt from a department store you don’t know where exactly your money is going. When you buy from a consultant, a chunk is going directly to her family.
  • Some companies are better than others.

  • If you start to see your friends and family merely as $$$, don’t do it.

    • Relationships are important. A benefit to social media is that you can connect with lots of potential customers EVERYWHERE. Do NOT strain your relationships by seeing EVERYONE as only potential customer. You NEED friends. You NEED family. Period. Yes, you should tell them what you’re doing. No, you should not badger them. If you feel pressure to do this run the other way. People are not dollar signs. Don’t see them as such.

Are Multi-Level Marketing Companies beneficial to their consultants?

Multi-Level Marketing Companies can be beneficial IF the potential consultant does all their homework and is an informed participant. Look at who you are signing up under. Are they new or are they experienced? Are they making money? Sign up under an experienced person or be prepared to do the leg work. I believe you can make money and have a good time doing it. Also look at the company and it’s reviews. I can say that Pampered Chef was AWESOME on their end when it came to taking care of my customers. Something not right? They fixed it, quickly! I have read lots of complaints about slow shipping from Usborne Books. Thirty One Gifts seems to have great reviews. It’s important to like what you sell. For instance, Pampered Chef makes some of my absolute favorite kitchen items. So it was super easy for me to tell someone about them or help them pick something out. I loved the products, it didn’t feel like “selling” for me.

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