Multi level marketing

2020-03-09T12:19:00.001+05:30

Network Marketing

Network marketing or multilevel marketing(MLM) is a business model that depends

on person-to-person sales by independent representatives, often working from home. The profession appeals to many people because they can be their own boss, set their own hours, and work towards their own success.

Network marketing

Network marketing is known by a variety of names, including multi level marketing(MLM), direct selling, cellular marketing, affiliate marketing, consumer-direct marketing, referral marketing, or home-based business franchising.

Network marketing efforts

The economic slowdown of India plays a crucial role that more and more entrepreneurs are thinking out of the box to opt for a profitable business platform-“Network Marketing or MLM” business.

Network marketing in India

Government website for all legal direct selling companies in india

People in India are concerned about making money conveniently and simply, and the same is the major highlight of the network marketing business. People are very smart that they analyze the history, statistics report, or growth of network marketing business 2020 to know the past and future of the network marketing business.

The present condition and development of network marketing business in India looks to be cheering and assures future success in the industry in the coming years.

By comparing with the other developing countries like USA and china, India is still standing behind to accept the MLM business completely. The only reason for this is the MLM scam running behind the network marketing business. The scams decline the Indian economy, but nowadays, the precautions are taken care of to get rid of MLM scams.

Scope of network marketing

To avoid the MLM and direct selling scams Indian Government has come with new guidelines and regulations which must be followed by all MLM companies to eradicate many MLM frauds.

MLM growth in other countries

Network marketing is one of the oldest and traditional businesses of selling products at multi-levels and forming an extensive network of people to promote the business.

The direct selling industry or MLM industry in India seems to be promising in the yielded benefits. Yes, that is almost doubled in the year 2016 when compared with the year 2011. From the report of ASSOCHAM, it is evident that it will touch the record of around 159.3 billion in 2021.

The study showed that the ranking of MLM business was increased from 22nd position to 20th position during the year 2015 to 2016. The top three markets during those years were the US, Korea, and China.

During the year 2015 to 2016, the sales volume attained a record of $183 billion globally. A huge number of people started joining the MLM business. Almost around 80 percent of the countries around the world started joining in the MLM business.

History of Direct Selling

In 1886-MLM business has evolved in the USA during the year 1886 with the establishment of Avon.
In 1925– During this year, the direct sales volume increased to around 300 to 500 million USD.
Between 1940 and 1960– Many companies emerged based on the concept of multi-level marketing or network marketing.
In 1970-New products are being focused on improving the MLM business. Product categories like wellness products, household products, food items started evolving to attract customers.
Between 1990 and 1996-Many major MLM companies like Avon, Amway, Tupperware extended their service globally to build massive customers for their MLM business. They started their MLM business in India, Korea, China.

Growth of direct selling or network marketing in india

Direct selling is likely to reach about Rs.64500 crore in India by 2025, a FICCI-KPMG report said. Direct selling has already emerged as a successful industry in over 100 countries, with a market size of USD 182.8 billion.

Network marketing growth in India

The Direct Selling industry in India has almost doubled since 2011 to reach Rs 12,620 crore in 2016 and is expected to grow at a compounded annual growth rate (CAGR) of about 4.8% to reach Rs 15,930 crore in 2021, reveals the study undertaken by ASSOCHAM.

Benefits from Network Marketing

Additional income opportunities: Direct selling or MLM industry provides additional income opportunities or passive income to a large number of people and promotes micro-entrepreneurship.

Currently, over 5 million direct sellers in India are estimated to be engaged with the industry, and are projected to grow further with the growth of the industry

Women empowerment: Direct selling offers self-employment opportunities or work from home oppurtunities to a large number of people, especially women. The share of women in the industry has been around 60% on average for the last 3 years. However, a recent survey found that more Indian men are joining this business as a way of self-employment and entrepreneurship.

Enhanced Employment Generation: As we have already know that it provides passive income for the marketers, it also provides employment opportunities for a large number of people. Most of the time MLM companies interact with various vendors to accomplish operations like packaging and distribution.

Contribution to government sectors:

since the MLM companies or direct selling companies generate a huge tax to the government. It helps in improving the Indian economy with its huge revenue. During the year 2013, the tax generated was around INR10 billion. It also contributes to direct and indirect tax.

Difference between legal and illegal network marketing companies

Legal company

1. Clarifies that you need to learn new skills and work for that atleast 7-10 hours/week for 3-5 days to earn big money.

2. There are significant products and services that people would buy even without participating in the business.

3. Commissions are paid mostly on the basis of sales of products or services.

Illegal company

1. Promises quick and easy money.

2. There are no significant products and services to buy and sell.

3. Most commissions are paid for recruiting new members, selling training material etc.

Myths in network marketing

1. Pyramid structures are bad

The first biggest misunderstanding people have with this type of business, is the structure. Some brand new inexperience consultants do not know what to say about this, and end up trying to deny it or cover it up by saying, it’s an upside down pyramid, but here is my response.

So what? So what if it does.

Here is the important point that 95% of people miss. All traditional business, government and nearly every big organisation all have a pyramid structure.

The Traditional Business

In traditional business, you have the CEO/MD at the top of the pyramid, followed by heads of department, followed by upper management, followed by middle management, followed by lower management, followed by supervisors, followed by new staff, followed by customers. It is a pyramid structure.

Pyramid structure in an organization

Government

Next, government. So in government you have the President/Prime Minister at the top of the pyramid, followed by his closest advisors, followed by heads of department, followed by chief MP’s, followed by MP’s and so on. Guess what? It is a pyramid structure.

Pyramid structure in Government

2. Only the people at the top makes money

Another concern people have is that, it is only the people at the top that make any money. 90% of people who join don’t make any money. Guess what? This is true. You’re right. However let me also reveal some very important insights to you.

This is the same in learning any skill or industry!!!

Let me explain.

The Martial Arts Analogy

The best analogy for starting a network marketing business, is that it is very similar to starting in and progressing in the martial arts.

Picture This: In a room of 100 people in a typical martial arts class, there will be a 1-2 black belts who are taking the class, 3-7 brown belts helping out, quite a few more red and blue belts, and the vast majority of people are white belts or brand new. Sound familiar?

Building your MLM business is just the same as wanting to become a black belt. The sad fact is that most people quit.

Some of the best statements given by Warren buffett, Bill Gates and APJ Abdul kalam about network marketing is

Multi level marketing or Network marketing

Multi level marketing

Network Marketing

Legal company

Illegal company

1. Pyramid structures are bad