Why is the MLM Failure Rate So High?
It’s generally accepted that approximately 97% of all MLM home business owners will spend more money than they make. This results in nothing more than a fairly expensive hobby, and ultimately results in MLM failure.
Why?
I posed this question to several of my colleagues in the home business industry and, to my surprise, there was an overwhelming similarity to their responses.
The NUMBER ONE reason that most experts gave for the high MLM failure rate?
UNREALISTIC EXPECTATIONS. People getting into the business for the wrong reasons, and expecting unrealistic results.
Who is to blame for these unrealistic expectations. I believe the fault lies with both the new business owner and the network marketing industry.
Many people start a home business NOT to build a long term source of income but to make money quickly. They need money to pay bills, to pay off debt, or for some unforeseen emergency.
They read the HYPE on the internet, or get caught up in the excitement of a presentation, and sign on the dotted line.
Next thing they know, they find out they have to spend more money to purchase more products or to get higher into the compensation plan to make the kind of income they need.
They soon find out that there are a whole set of skills they need to be truly successful, including sales, copywriting, and marketing skills that take most people years to acquire.
And they get frustrated.
What they really want is quick money, a lot of money is as little time as possible.
They did not sign up for the long term plan.
But that is what a home business really is. It’s NOT a get rich scheme, it’s a get rich slow scenario.
And we in the Network Marketing and MLM industry are also to blame. Because of the HYPE.
We set people up for their unrealistic expectations based on our “hypey” ads, our misleading sales pages, and our broken promises of full and complete training.
That’s the bad news.
The good news? There ARE companies out there that deliver what they promise in terms of training and support. There ARE companies that cut the learning curve down dramatically with their systems.
But even so, it still is going to take the inexperienced marketer some TIME to acquire the necessary skills to succeed in their home business.
That is why I make sure that all of my prospects UNDERSTAND UP FRONT that they will need to work at their business, to treat it like a business and not like a hobby, and to learn skills they may not have at the moment.
I make sure my prospects understand, REALLY UNDERSTAND our company compensation plan, so that they are not blindsided by any additional funds needed to get their business off the ground.
Do less people sign up with me because of this. UNDOUBTEDLY.
Does it bother me? NOT A BIT.
Why? Because the ones who don’t sign up are the ones who would drop out within 6 months anyway. They are not really looking for a home business. They are looking for extra cash. And most times they don’t really want to work all that hard to get it.
What am I left with? A team of serious entrepreneurs who understand that it takes time to attain success and that sometimes money has to be spent in order to generate more significant earnings later on.
And these people are HARD WORKERS. They are not looking for a free lunch.
They are my kind of people!
To Your Success!
Dr. Bob Clarke
September 30, 2008; Cresskill, NJ
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