One of the great tests of commitment to an MLM business is the ability to sell the products at retail prices. Justifying the expense of a product for one's personal use--purchased at the wholesale price--is an easier task than selling it to one's neighbor at a retail price that might be anywhere from 20%-100% higher.
Here's an example of what can happen when newly signed up MLM distributor, John, cheerfully approaches his neighbor, Sue, with a bottle of product in hand:
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"Sue, I've got this great product that I'm selling and it's only $50 a bottle, less than $2 a day for some possible health benefits that I can't make claims about. But it really is good stuff and will cure what ails ya!"
Sue thinks to herself "Yikes!!! $50 a bottle! I can get a 12 year old bottle of Chivas for that, something that I know will cure what ails me." Sue politely says "No thanks, John. That's a bit pricey for me."
To which John replies "Well, I could sell it to you at the wholesale price of $30, that's what I pay for it." John is willing to make this sacrifice in the hopes that Sue will try the product, harmonize with the universe after 3 days usage, and come back begging for more for all of her family members. And maybe fortune will be smiling down upon him and Sue will accept his discounted offering as a sign of true friendship, and proceed to sign up as a distributor in John's downline.
Sue thinks "Hmmm, that was quick...I wonder if John is trying to recruit me into an MLM...oh boy, here comes the pitch about financial independence and all the money I can make selling this stuff. But if John is so quick to throw away his profit margin, how easy is it to make any money from sales? Sure, if you are a good recruiter and sign up enough people over time you can almost make minimum wage in bonuses for your efforts. But I'm not interested in an MLM at the moment." Sue says "That's awfully kind of you to offer me that discount, John, but things are a little tight right now, so I'll have to pass" and thinks to herself "Please go away now."
John is a bit discouraged and says "Thanks, Sue. See ya around," and dejectedly heads home, thinking to himself "Man, there is no way I can sell this stuff at the retail price!"
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While John made several mistakes that more experienced MLMers wouldn't, the root problem was that John hadn't yet decided to run a real business selling a real product. Even the kid with the lemonade stand learns that if you pay more for your product than you are selling it for, you're going to lose.
Unless, of course, your real business is recruiting people to sign up with a company that rewards you for recruiting people, regardless of whether or not you ever sell any of their products.
Don't get me wrong...many, many people get HUGE checks every month from MLM companies and have never sold their products to anyone...and might not even use the products themselves. Oh, and the "suggestion" that they sell (or use) 70% of their inventory purchases every month? Don't worry about it, no one is checking up on that one.
Does anyone ever sell their products at retail prices in the MLM industry? And how is that possible if all the other distributors are selling the products at wholesale prices?
It does come down to one of the challenges of any business where a product is sold. Some people can sell a candy bar for $1 when others can't sell the same bar for 40 cents. A lot depends on how you market it and how well you can sell.
If you knew for certain that the product that you were selling provided such great health benefits to the user that even at $50 a bottle it would be a bargain, could you sell it for that much? Wouldn't you rather make $20 a bottle profit than $0? Sell 10 bottles and make $200? Now we're talking business.
What? You can't retire on $200 a month and you were hoping to earn thousands of dollars a month in residual income as the result of building a large downline?
Who says you can't do both? The business owner who can sell at retail prices is so convinced of the worth of their products that they will naturally attract the interest of customers and others who would like to run a similar business. And except for the born recruiters--those masters of MLM signups--who do you think will successfully run their business longer, the "I can sell this stuff at retail prices" distributor, or the "Please, please buy a bottle from me at wholesale prices" distributor?
My bottom line: To build a long-lasting, successful MLM business, learn how to sell your products at retail prices...or hightail it to the next MLM that comes along promising huge success without having to do any work.
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