For the masses, it's an immensely captivating idea: the chance to be your own boss, earn a good income, work pliable hours, lead a team, and possibly even have your own online sales site. If you have an entrepreneurial soul it would seem absolute, right? In fact, crowds try it through multilevel marketing (MLM) companies, a business model in which companies use independent distributors to sell their products or services directly to the public. Some of the lion’s share famous companies that work under this model are Herbalife, Mary Kay, Avon, Amway and Pampered Chef. But there are so many more that jointly represent a $35.4 billion-a-year industry in the United States. In 2018, more than six million people in the United States, 22% of them Hispanics — participated in one of these businesses, uplifted by the possibility of achieving financial independence or supplementing their income.

But the reality is that the majority fail and do not bring out profits. They even lose money. According to the Direct Selling Association (DSA), direct sellers (distributors or consultants) earned a mean of $5,702 in sales in 2018. There are those who surpass $100,000 in annual income, but it is the minority. Those who achieve it are because they not only make their own sales, but also have a team of salespeople who bring out commissions for them hence they are called “multilevel” companies, and a 2018 AARP Foundation study found that 47% of older adults who said they assisted in this type of business reported losing money, while another 27% reported zero profits; 76% had no prior commission-based sales experience.

Key to success

The hidden formula is that you have to look for something not only to make money, it has to be something that you want, that you are passionate about, because that is going to connect you with the product and people are going to feel it. Saying of an expert who turned her passion for health and nutrition into a very profitable business.

Before starting

MLMs are a recognized form of economic development, but you should acquaint yourself with them before you get involved. If you are interested in making your way under this business model, reckon the following points:

Research and get advice

Before putting your money, research the company, its officers and products. Have you had intricacy with the law? Are there consumer or seller complaints on forums or websites?

Check with others who have experience with the company and its products to determine if it's worth getting involved.

How does the process work?

To commence, companies require you to purchase a kit of starter products. When you buy more products, the company gives you colossal discounts. Companies encourage distributors to sell products to their family and friends to start a network of customers. Few distributors now have digital stores on the internet and use social networks to foster the products they sell.

Understand the product

Is it serviceable, and something that people are looking for or need? Is it something that they will buy from you just once or very sporadically or repeatedly? Is it a product that requires a demo to understand its use and benefits, or a product that lends itself to selling online?

Understand the market

Yonder your network of family and friends, under what circumstances will you act? For example, is the product you plan to sell from a well-known brand that advertises its products on social and traditional media? Who are your competitors? That is, other companies with similar products, or other distributors of your same company. Where and to whom do they sell? Is it a market that proposes direct communication, in more confidential meetings?

Ask for information in writing

Do not sign any contract or give money without being aware of the risk and your responsibilities. Take time to think and investigate. It is your money, your investment and your future, do not let yourself be goaded. Seek legal advice and from someone you trust who is not in a league with the plan or the company, watch the ValidUS Presentation.

Ask direct questions

Work out the characteristics with company leaders and other distributors. Remember, it is your money, your investment and your future. As they answer you, you will be able to evaluate if it is really convenient for you to participate

Warning signs

Evade working with any company that:

• Blow up your earning potential
• Push for you to sign a contract quickly
• Requires purchases or training with high up-front costs
• Does not allow the return of unused inventory
• Suggest you go into debt to buy inventory
• Has a poor rating with the Better Business Bureau

Consider your interests, goals and personality

After all, do you relish selling? If you think you won't enjoy selling products to strangers, or keeping accounts; If you don't have space to store a record or lack a reliable means of transportation, there are points against you. It doesn't matter if the product is good or you have a solid business plan, if you don't like selling or making new contacts, you will have a difficult time.