Here we go with Question Six from my June 11th post, 7 Questions To Know About Your MLM Compensation Plan.
Question Six: How much do you really get paid on retail sales?
People get confused on this one all the time. What is this biggest problem in MLM? The product are usually so overpriced that no one can retail anything. In fact we hate to sell to people because even at our cost, the product is too expensive.
Some companies have tried to overcome this by selling products that are so exotic that no one knows about them and distributors are working to create a market but at least there is no established value in the market.
Others want us to believe that their product is so special that it can demand high pricing. Funny but research outside of what the company tells you never indicates that the products deserve high pricing.
Some companies tell you how you buy at wholesale and sell at retail to make this nice 30 to 50% profit. Of course no one can sell at a profit.
Other companies know that you, the distributor are already feeling the product is priced high so they let you bring your prospects to your company website where they can buy at special discounts and even better if they go on autoship. Great but now you make so little that you don’t have any incentive to retail anything.
Hey, could be worse. Some companies show your customers the regular price on the website at some unrealistic marked up price that no one would pay and then offer them the chance to join for free and get the distributor discount. Not only does this take away most of your income but in some pay plans it blocks your progress and almost guarantees your failure.
Then some companies retail at the same price that distributors pay. They price the products competitively in the market. Then they pay bonuses for retail. A model that actually makes distributors a lot of money and encourages retail.
Why do you want to encourage retail? Let’s say that you make five dollars from everyone in your organization who buys $100 of product each month. If they only buy $100 and nothing more, no retail sales etc. then you know that you will make $5 per person and you need 2000 people to earn $10,000 per month.
What if you encourage retail sales and the distributors on your team average $200 per month. Some may not retail while others do $100, $200 or maybe $1,000 extra per month in retail. Well by doubling your average volume per person you just made it possible to create that same $10,000 per month income with half the number of people on your team.
Look for the ability to truly earn retailing income in a compensation plan. You will have some people who remain distributors just because of this income stream. You can reduce the numbers of people you need to reach income goals. It makes a huge difference and most people miss this completely when they evaluate compensation plans.
Learn more at Mentoring For Free.
7 Questions Accountability Partner Bob Burg Build Relationships Colors To Success Color To Success Compensation Plan Don Standard duplicable mlm system duplicable system Facebook FortuneNow.com Free MLM Training free training calls Ground Floor Opportunity Jim Rohn Mentoring For Free Michael Dlouhy MLM Compensation Plan MLM Compensation Plans MLM Duplication mlm mentor MLM Policies and Procedures MLM Skills MLM Success MLM Success Ebook MLM WatchDog Penny Dude Personalities Policies and Procedures Proven Duplicable MLM System Proven MLM System Recurring Income Relationships Scam Social Networking Success In 10 Steps Terminations The Go-Giver Tom "Big Al" Schreiter Tom Schreiter Twitter Video YouTube YTB
