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Phil's Past Episodes Episode 14: The Warning Signs I've seen it too many times. People working long hard hours in an MLM, devoting time and energy into it, only to have it all fall apart. They're left with nothing to show but a bunch of lost time, energy, and effort. An through no fault of their own, either. Things just happened. The simple fact is that the MLMs that stand the test of time are the MLMs that have a viable product, and have harnessed the true potential of Multi Level Marketing by providing an honest commission structure and support system. The rest of the MLMs out there will fade. Some rather quickly, too. You can do all of your homework, and still get burned by an online scam. They check out 100%. More than likely, they probably are. I've read countless articles about business models that were swayed by the luster of MLM only to completely fail. There are, however, some warning signs to look for. There are some limits and thresholds that should not be broken. If you can spot the warning signs, you might be able to leave the MLM in time before the ship sinks. Warning Sign #1: "The Big Push" This is one of the first ones you'll see when there's a money issue. On a weekly conference call, you'll hear people talking about how to recruit more people. They'll offer one time bonuses for bringing on new people. If there are different levels of commitment, they'll not reward the lower levels - only the higher levels. This will be a limited time deal, too. More than likely, it will expire before the end of the month. MLMs based on breakage actually lose money when people do well, and stay. They no longer have the ability to pay out the high commission and bonuses without dipping into their own pockets. MLMs don't like this. They don't like spending their own money. When large amounts of people join an MLM, they make more "front end" money, and therefore can afford to meet their payment structure. Warning Sign #2: "Technical Issues" This is one of my favorites. Being a "technical guy" who has worked in the technical side of MLM for years, when I hear this, I always ask for more information. "Technical Issues" is an excuse. It buys time. We are so complaciant in our society with the "technical issues" excuse... why? Because we've all had "technical issues". I personally know people who have multiple computers just because (they say) "this one doesn't work with this program, but this one does". The bottom line is they don't know how to make it work, so they say it doesn't work. Same story in MLM. They can't make something work for them, so they call it a "technical issue". People immediately back off. If someone like me asks for more information, the first response is normally, "It's technical. I don't understand it. My guys are working on it. They assure me they'll have if fixed soon." -- Allow me to translate that. "I don't want to tell you what's going on, but I want to shift the blame from me so you'll focus your anger on someone else." See, now, when they re-issue this sign (it comes in threes), you will begin to empathize with them. "I know how you feel, Bob, I've had problems with my computer, too."... Warning Sign #3: "Too Many New Unrelated Things" Depending on the company you're working with, you may have new product lines come about every so often. You might have new affiliate programs to work with, or new items to cross promote. This is fine, normal, and acceptable. When you're working with a company pushing a voice communications device, and suddenly are presented with a confusing software product that has no intrinsic value... that's a different story. When you're suddenly asked to promote or sell a product that has no similarity with the product you were originally attracted to, it means there is something going on behind the scenes. Typically, what's happening behind the scenes is a money issue. It could be that the CEO of the company managed to completely destroy a working relationship he had with a key company in his business causing him to grasp at weak ideas in order to salvage what's left of his business. It could also be a sign of complete lack of vision and direction from the company you are doing business with. In any case, it's a clear warning sign that something is not right. When you ask why, you'll be presented with one of several reasons the company is doing this. The answer will always seem to be in your favor. "This is the new best thing on the market", or, "It's the same thing as X, but in a different package", or, "We're doing so well with X, we feel that we can do even better with this." Unrelated change is never a good sign. Warning Sign #4: "Extended Down Time" While there are some types of companies out there today that can, and do, close for a season, or have a planned company-wide vacation, MLMs are not one of those types. MLMs are in the business of making money 24 hours a day, seven days a week. Vacations are needed, and deserved, but when the entire company goes at the same time, you have to ask the question: "Are they coming back?" Even "team building" exercises leave someone behind to answer the phone and provide skeletal company support. Warning Sign #5: "Communication" This, as in everything, is the big one. There are two sides to this warning sign... busy, and busy. While, yes, people running MLM companies can be very busy, they're not that busy. In today's world, people can record a voice message while they're doing a myriad of other things. That voice message can either be sent out as a blast, or left on a system for people to hear. Communication is key. When the MLM stops communicating in the same fashion as what has been the accepted norm, there are issues. The pattern is typically more communication for a bit, then less communication, and finally no communication. As warning sign #1 pointed out,"The big push" is a clear sign that the company is having money issues. You will also notice a heightened amount of communications. More emails, more phone blasts, more messages in your back office... simply more. This is done out of desperation. They need money, they need it now, and what they did yesterday didn't get the response they were looking for. They're going to try something new today. If you notice less communication, it's a sign that things have gone from bad to worse. Now the company is running around trying to find ways to bring in one large sum of cash. Principles in the company are busy making phone calls to their "inner circle" asking them if they'd like to become a partner. They're looking for investors, they're looking for loans, they're looking for credit cards they haven't used to make the company payroll. When the less communication drops to no communication, it's safe to say time has run out. Bills haven't been paid. Access is being cut off. Webhosting, telephones, power to the building... without money, these things just go away. The snowball has grown too big to play with now. It's time to head to Mexico. Know the warning signs and what to look for. If something doesn't sit right with you, if your gut feeling tells you something is wrong, ask people about it. Investigate. Find an answer. If you can't get an answer, then your path is clear. For MLMEruption.com, this is Phil Foster - The Trusted Voice of MLM |
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