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What is Multi-Level Marketing?

Updated: 6 days ago




Multi-Level marketing is a system of distribution and sale of products or services that are carried out directly. In other words, the company sells its product now to the consumer, and they can become distributors and make a profit by reselling or recommending it.

Undoubtedly, this type of strategy allows us to have the opportunity to achieve a more significant potential for growth and expansion in our business. At the same time, we are committed to greater development and innovation of the sale and the product. Thanks to multi-level marketing, we increase the distribution network of our product and, therefore, the influence we obtain in the sector.


Direct selling and collaboration

As multi-level marketing consists of a sales system through the direct distribution of products or services, its main characteristics are direct sales and the involvement it needs from the sales team.

This scheme makes this strategy one of the most effective ways to activate a business and get the product to market more successfully.


What are its main characteristics?

Direct selling is undoubtedly its main characteristic and the network of distributors that are formed with the application of multi-level strategies. This consists of going directly to potential customers and selling the product to them to achieve commercial success more efficiently.

Therefore, the work system benefits the company's structure, helping to save time and effort both in logistics and time. These strategies are also called networking marketing due to the collaboration system created between the sales team, achieving benefits proportional to the volume of business that each member has managed to create.


Characteristics of Multilevel Marketing

Some factors are crucial when starting a multi-level business or started being part of a company that has it as a business model.

So here we define some characteristics of this type of Marketing:


Work system

When a sales representative or independent distributor arrives, they save a lot of time and money since they benefit from the entire structure already created in administration, logistics, billing, etc.


Labor relationship

Multi-level companies are horizontal. In other words, there is no "boss-employee" relationship.

So, the distributor should not respond in terms of schedules or goal setting.


Income limit

The setting of objectives in terms of everything that has to do with the economic issue and income is set by the same distributor. In this type of business, there is no limit or ceiling in terms of income as such.


Investment

An average distributor can calmly start the business with a minimum of investment since there is no money to put in for the infrastructure, nor does he risk his capital to set up the business, among other factors. To get idea of what you can spend and what you earn, checkout our business calculators.


Multi-level business benefits

You will have already seen in previous texts many of the benefits of this type of business, but here we list them so that you have them clear and at hand when planning.

However, these are only the benefits that the MLM business brings to distributors or sales representatives.

  • It lets you manage your time.

  • You can work from home and with the Internet.

  • It allows you to create new contacts.

  • You can make a minimal investment.

  • By setting a fixed client portfolio, you will not have to worry about the sales of the following months.

  • You will be your boss.

  • In most companies, you don't need the experience to go into business.

  • You can enjoy the products/services of the company.

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