If you have decided to read this article you are probably one of three things:

1)      You are hoping to find proof that network marketing is a scam so you can save your spouse, your sister, your friend or yourself from the temptation of a network marketing business.

2)      You are having doubts about joining a network marketing company and are looking for a reason to stay in or get out.

3)      You are happily in network marketing and tired of people knocking it.

Regardless of why you chose to read this article, you will find straight facts on network marketing today.

Network marketing used to be something mommies did on the side or strange Uncle Bob did to find his fortune. But over the last 10 years there has been a shift in attitude towards network marketing that has lessened the stigma of the industry. Experts point to Success Magazine’s investigative yet unbiased look into network marketing in the 1990’s as the start of this change. Since that time books on network marketing, top corporations’ use of network marketing to deliver products, and even a college level marketing course studying network marketing have encouraged people to take a second look. Other contributing factor has been people’s increasing desire for financial stability and time with family with limited time and money,

According toe the Direct Selling Association, direct sales is a $28 billion dollar industry in the United States and over 55% of Americans have bought through a direct distributor. Zig Ziglars book, “Network Marketing For Dummies” reports that network marketing is a $100 billion dollar industry with over 35 million networkers worldwide. But despite the increasing numbers of network marketers worldwide, many people maintain old attitudes and misconceptions about network marketing. Here are some common misunderstandings about network marketing:

1)      It’s an illegal pyramid. This is the most common misconception about network marketing. In the 1970’s the Federal Trade Commission spent a great deal of time investigating Amway Corporation. In 1979, the FTC determined that the business concept of Amway was legal and used the company to set the standard by which other companies are measured. In the pyramid test, the shape of an organization does not determine its legality. If it did, most businesses and organizations including the government would be illegal because all have a pyramid structure. What makes a program an illegal pyramid is that there is no product or service and/or people get paid for the act of recruiting alone. Legitimate network marketing companies offer products or services and income is earned through the movement of these products or services. Members can build an organization however income is earned from product sales not the act of recruiting alone. Other features legitimate network marketing companies must adhere to are; publishing of income average statistics, no requirements of inventory, and refund options.

2)      Only the guy on top makes money. This is true in illegal pyramid schemes and in big business but not in network marketing. Think about this: When will the guy on the assembly line ever work hard enough to become the CEO of the corporation? The reality is that network marketing is the only industry in which the guy on the bottom can make more than the guy on top if he works harder to do so. Income is directly related to effort, which usually isn’t the case on a job.

3)      Network marketing uses people. This is a variation of the argument in #2. The truth is, in network marketing, everyone is genuinely invested in everyone else reaching their goals because success only comes from helping others. This doesn’t occur in jobs in which people are rarely compensated for quality work and are even less likely to be compensated if they help someone else do quality work.

4)      Eventually the program will get saturated and fall apart. This would be extremely unlikely. First of all, there are 6.5 billion people on the planet the majority of whom do not have a network marketing business. Second, everyday, someone turns 18 which means every day new potential customers and networkers come of age. Third, everyday, some one is born which provides future networkers. But, I think the best argument against the saturation idea is given by Tim Sales in Zig Ziglar’s Network Marketing for Dummies book. To paraphrase, he asks, “Do you know anyone without a refrigerator? No? That doesn’t stop GE from selling them.”

5)      It doesn’t work. The only time legitimate network marketing doesn’t work is when the person doesn’t work it. The fact is network marketing’s failure rate isn’t any higher than any other business start-up. Dun and Bradstreet report that 63% of all small businesses fail within the first 4 years and 91% fail within 10 years. Success in any business requires planning and action. The advantage of network marketing is that there is personal help, a system already in place, and vast resources. The majority who fail don’t take advantage of these resources. They try to reinvent the wheel or the let life get busy and don’t focus on their business. Network marketing does work but only if you work it.

6)      No one really gets rich and most people fail. The income rates in network marketing aren’t any worse than the income distribution as a whole. In fact, the 225 richest people in the world have a combined wealth of $1 trillion, which is the combined income of the 2.5 billion poorest people. But no one says computer-related businesses won’t make you rich or the stock market is a scam. Most people recognize that Bill Gates and Warren Buffet didn’t just sign up and expect to be rich. They worked hard. The reality is that the 2-10% of network marketers that make money are also the 2-10% who really work their business. Nevertheless is important to point out that getting rich shouldn’t be the marker by which network marketing is measured. Many people don’t want to get rich. They want to buy a house, or stay home with kids, or pay off debt. They just want to work a few hours a week and earn a few hundred bucks. Network marketing allows people to work part-time and earn an income based on their effort… their effort being the key factor in how much money is made.

7)      Network marketing is a cult. I’ll admit there are some fanatical network marketers in the world. But fanatics are everywhere and in all groups from religion to entertainment. Fanaticism isn’t a requirement and in fact, most companies work hard to keep their reps grounded in facts and figures. But like in all work-at-home schemes, there are some who will take it too far and that’s your cue to go on to the next opportunity. Quality networkers are honest and realistic. They will tell you that networking marketing is work…hard work and only the few who are willing to do the work will achieve their success.

The reality is that network marketing is gaining steam as a viable way to earn income part-time. Corporate loyalty is dead. Job security is gone. The best way to secure your financial future is through a home business. Of course you can start your own business from scratch but what network marketing offers is pre-existing products and services, and a proven system to make it work. Its not get rich quick but the potential to create your financial freedom is there.

Choosing a network marketing business can be a challenge as there are so many to choose from. Here are some tips to help you:

1. Choose a company that is at least five years old as most companies that fail, do so in the first five years. Check that it’s listed with the Direct Selling Association, which has strict standards for member companies.
2. Choose a company with products and services you can get excited about and would really use. Consumable products that people use are usually easier to promote than obscure or expensive products and services.
3. Make sure you understand how people get paid. It should be based on product volume.
4. Make sure you understand the refund policy.
5. Find a sponsor that you like and feel comfortable working with. That person is your coach and mentor. Don’t be afraid to use them. On the other hand, they won’t build your business for you so you need to do what your sponsor tells you to do.