Multilevel marketing, how does it create residual income? You find other people like yourself that want to own their own business. You share the opportunity for them to be self employed, for that you receive a small share of the sales that move through them and the people that they share the opportunity. This is referred to as “sponsoring”. “Sounds like a pyramid” you say. NO, your job is a pyramid! Only the people at the top are making any money. “Isn’t that the same in multilevel”? Again, the answer is emphatically, NO! It is a little complex as to how the structuring works but there are ways to do it properly and other ways to do it improperly that affect the income dramatically.
An example of the right way would be to sponsor a lot of people directly at your level. If you do that properly you will make a fair amount of money. If you only sponsor a few people at your level then most of that income can stay below you. Hence the people you sponsored can actually make more money than you do being quote, unquote “above you”. You will not very often see that in a corporate environment where the boss make less than an employee below them. It happens but not often at all.
There is a lot more to the puzzle involving multilevel marketing and it’s strategies. If you are looking into multilevel marketing business do yourself a favor and make sure you do your due diligence in researching the parent company as well as the organization that your sponsor belongs. Companies like Amway, Avon, and Melaleuca have been around a long time. Hope this clears up a few misconceptions about how multilevel marketing works.
Oh yeah, big information, the FTC requires multilevel marketing companies to provide a potential earning disclosure sheet. Make sure you get one from the person that showed you the opportunity.
Have a great day!
Rich