Now, before all the network marketers out there start sending me hate mail, let me say that I am not against network marketing or MLMs as a business model or process. In fact, I have served as a business consultant for some MLM companies and believe that many MLMs (not all) are legitimate businesses. However, there is something that most network marketers are getting wrong. Let me start with a horror story...
There once was a poor Filipino laborer that was invited to a “business opportunity meeting” back in the mid-1990s. Though the “buy-in” to this MLM Company was rather steep, the poor Filipino laborer was so convinced about the products and the marketing plan that he scrimped, saved and borrowed to make the buy-in.
Because of his hard work, he was able to purchase the needed products and, finally, start his network marketing business. Determined to get out of his poverty-stricken situation this courageous young man worked tirelessly to build his network.
After years of trying, he finally made his first million; and, as if by magic, his network grew on its own. The money seemed to be coming in from everywhere, and the once poor Filipino laborer was now a very wealthy celebrity (at least in the MLM company he worked for). He was now living the “good life”; purchasing mansions, sports cars and even a yacht.
Yes, he was a “made man”; or at least that’s what he thought.
A few years after his dramatic rise to fame, some officers of the Philippine Bureau of Internal Revenue (BIR) came knocking at his door. The BIR had, somehow, been made aware of this former laborer’s phenomenal rags-to-riches story and tried to find out if he had paid his taxes. They found out that, for several years, this ex-laborer had never paid a single centavo of tax for the multi-millions he had made.
Eventually, the BIR took the laborer-turned-network-marketer to court and demanded that he pay all his back taxes plus penalties or go to jail for tax evasion. A deal was later made; but the once rich network marketer was now wiped out.
This is a true story.
Many network marketers think it’s easy being rich. They work hard, trying to escape poverty; only to have the rug pulled out from under them. What most network marketers don’t realize is that (borrowing from Spiderman), “with great wealth, comes great responsibility.”
Often, I’ve heard many powerful MLM speakers preach about entrepreneurship; even quoting Robert Kiyosaki, Steven Covey and T. Harv Eker. Yet, many of these speakers don’t even teach the basics of starting a business.
Here are a few things you need to do when starting a business… yes, even an MLM business:
is the Managing Director of Our-Knowledge Asia and a Business Consultant for Local and Foreign Start-ups, SMEs and Organizations based in the Philippines.