Network Marketing: What is it and is it right for you?

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Do You Have What It Takes To Make Extra Money

We could all use a little extra cash at times and they are various ways of earning that money to supplement your income whether it is through online surveys or simply cutting your neighbours grass. But what if you could own your own business with a minimal investment, requiring as much or as little time as you want to devote to it, work from home and have all the training and support needed given to you for free?  Would you consider Network Marketing?

What is Network Marketing?

By definition from Wikipedia Network marketing is a strategy in which the sales force is compensated not only on sales they personally generate, but also for the sales of the other salespeople that they recruit. This recruited sales force is referred to as the participants ‘downline’ and can provide multiple levels of compensation.

So basically what this means is you sell a product or service while getting other people to join your sales team from which you receive a portion of their sales, who then go on and recruit more people to join and so on. The more products you sell and the more people selling under you, the more money you make!

Network marketing is also referred to as direct selling, multi-level marketing or pyramid selling.

I’m sure most of you are familiar with companies such as AVON, Tupperware, It Works, ViSalus (Body by Vi 90 day challenge), or Amway, all of which are operated as networking marketing businesses.  In traditional business when you work for an employer or even self-employed, you have sales quotas to meet requiring multiple employees at times to meet those goals.

In network marketing you own your own business, working as much or as little as you want while having a host company that makes all the major investments while offering all the support you need because if their company is going to succeed they need you to be successful.

These companies also have quotas to meet but say the quota is $1,000,000 instead of having 100 employees each achieve $10,000 in sales they can reach their goal by having 10 000 people (who have volunteered and invested in the company)do $100 in sales each.  Smart thinking!

Almost sounds too good to be true

Over the years I have had multiple opportunities to sit through various network marketing workshops, one just recently last weekend and let me tell you I left each one of them absolutely amazed! The enormous incomes that some of these people make from selling such things as life changing superfoods and skin care products blew me away, and they do it out of the comfort of their home! Sounds amazing doesn’t it? Though the concept is pretty simple, being successful in these companies can be a lot of work.

Is Network Marketing right for you?

The atmosphere in all the workshops I have attended has always been uplifting and inspiring as you listen to some of the top earners in the company and how they now earn over $1,000,000 a year and they’ve only been selling for 4 years. Exciting isn’t it to think that you could potentially earn that much money too, although the majority of people won’t.

Ask yourself these questions…..

How much time and money are you willing to commit?

You can spend as little or as much time promoting your business as you’d like just keep in mind your compensation will reflect that.

How many people do you know or situations will you be in where you would be able to recommend your business/products to different people on an ongoing basis?

All the workshops I’ve been to recommend that if you want to be a top earner (typically $1 cash is all you desire million + a year) than you need to recommend your business to 2 people every single day. If some extra cash is all you desire than this number won’t need to be so significant.

Is there a product out there that you believe in so much that you can convince others to join your team in selling the product.? If you can’t convince yourself that it’s a great product how can you convince others to buy  or sell it? Using the all the products yourself and having your own stories to share on how you personally have benefited from using the product will be one of your best sales tools.


The first thing I most often hear when I have a conversation about one of the workshops I’ve sat through is ‘oh it just sounds like another one of those pyramid schemes’. Yes pyramid schemes, not to be confused with pyramid selling, do exist and have a very similar business plan but are focused more on the recruiting side to build revenues rather than actually providing a product or service.  Learning in-depth about the company and the product or service they are offering is key to making sure you avoid getting caught up in these pyramid schemes.

A few times I have also heard ‘oh they just want you to sell it so they make more money’ Well yes that is true but why is that a bad thing? Keep in mind that the top earners in these companies got to be at their income levels by training and recruiting, they want to see you succeed so why not grow with them?

Do your research

There are lots of legitimate network marketing companies out there and many that have been around for several years. Knowing some of the history about the company will be beneficial in helping make an informed  decision whether or not  the company is worthwhile.  AVON for example has operated as a network marketing business for over 125 years with over 6 million sales people worldwide, they are obviously doing something right!

Things you want to know

How long has this company been around for and what are their reported sales during that time?    If it’s too new of a company it may not be worth investing your money in as it may not be or ever be a stable business. 5 years is generally a good amount of time for a company to show stability.

  • Is the product or service something that would be in demand in today’s market?
  • How much of an investment do you need to make?
  • How is the compensation calculated and how often is it paid out?
  • Does the company offer training and support ?

If you have the drive and the ability to sell by word of mouth then network marketing may be for you. Network marketing has the potential to eventually lead to full-time employment for some but until you are comfortable with the company, their products and are earning a sustainable income don’t quit your day job.  

Many of these companies survive on people who get excited after seeing the potential earnings and without being fully prepared simply sell just enough product to get their own for free rather than building their wealth.

Would you consider a career in network marketing?

katrina cbb

Post Contribution: 

Katrina is regular contributor for Canadian Budget Binder and is as passionate about personal finance as she is gardening. Katrina is a horticulture graduate with over 10 years experience with landscaping and greenhouse production.

Her goal is to share her knowledge and experiences blogging about gardening and her continued passion for personal finance in hopes of motivating others. While being a single mom of two and an in-store marketing representative for major retail shops she also runs her own Landscaping Services in Southwestern Ontario.


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Photo Credit: Free digital photos Stuart Miles

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