Experts vs Expertise

 

The other day I saw a post on Tic Tok by someone I follow and respect. In this particular post she was on a rant about people who had successfully lost a significant amount of weight, made a video about their experience and were then garnering lots of followers from among other people who were hoping to lose weight. Her objection, it seems, was that these people did not have "credentials" (she does). In other words they had not been certified as weight loss experts by virtue of their education.

Now to be clear, I have nothing against experts. For the many years I was working my consulting business, I was one. But as I re-watched her video I had several problems with her whole premise.

First of all, education and credentials may make you an expert in the sense that they certify that you have taken classes and passed tests. They are a pretty good (but not infallible) indication that you posses some specialized knowledge about something. But that really says very little about your expertise or your practical, hands on experience. Being an expert means you are knowledgeable. Having expertise means you are skilled. Clearly they are closely related but they are not the same thing. Someone can have both, or can have either one without the other.

Second, while experts do indeed posses specialized knowledge, they may or may not be capable of using that knowledge in a practical way, or even communicating it to non-experts. Someone with expertise may not have a deep understanding of the theory underpinning what they do, but they can never-the-less do it well. I doubt that the mechanics who worked on the engine of my airplane were especially well versed in fluid dynamics or thermodynamics. But they sure could keep airplane engines running. It has been shown that actual penal system inmates are more effective at making a positive impression on troubled teens than are licensed physiologists. Knowledge vs skill.

Now I am not suggesting that you steer clear of experts. Experts create new knowledge and advance our understanding. But if you want to lose weight and have a choice between a college educated nutritionist or a certified nutrition counselor who knows how to do it but has never actually had to do it themselves, or someone who has personally lost say 45 pounds and kept it off for a few years, who do you want to talk with?

 

The Other Health Crisis

 

 

Once upon a time, as recently as the early 1900s, Americans were typically self-employed and worked until they died — which they could expect to happen, on average, around age 65. The old and infirm relied on charity or extended families for support. That all changed amid the rapid industrialization and rising prosperity of the 20th century. Life expectancy for those who reached working age shot upward but companies, which increasingly dominated the economy, proved unwilling to employ older workers, whom they saw as less productive. For an increasing number of people, a period of idleness became possible, even inevitable.

With old workers forced out of employment without the financial means to support themselves. the government recognized the new reality by establishing Social Security in 1935. The program initially started paying benefits at age 65, which became the official retirement threshold. Yet it was never intended to provide more than a bare minimum income. To maintain a decent standard of living, people (or their employers) had to do something they had never done before: set aside enough money for life after work.

Most experts agree that a significant portion of the population will lack the resources to live comfortably after they stop working. This lack of savings is more than a humanitarian crisis. It is also a social and fiscal disaster in the making. The more people reach retirement with inadequate resources, the more they will rely on welfare programs such as Medicaid, food stamps and Supplemental Security Income to survive. One study estimates that by 2030, seniors will require an added $7 billion in public assistance annually in the state of New Jersey alone. That’s almost a fifth of the current state budget. And New Jersey doesn’t have an outsized senior population. The situation in other states could easily be worse. Under very reasonable assumptions, this could overwhelm state budgets across the country.

For many workers in the United States, retirement is a train without brakes barreling down the tracks. It will come no matter what, but it may be painful when it finally arrives. In a 2014 Federal Reserve survey, 38% of those surveyed had no retirement plans, or planned to continue working as long as possible. This number is much greater in low income communities; among those polled with an annual income of $40,000 or less, 55% plan to never retire. And 53% of total respondents replied that they would be unable to cover a $400 emergency should problems in daily life arise.

A similar 2016 study performed by the Economic Policy Institute came to similar conclusions: just under one half of working-age families (39 to 61 years in age) have absolutely nothing saved for retirement. Zero. The mean amount of savings for families in this bracket is a paltry $5,000, or the equivalent of a month or two of living expenses.

This is not a matter of lazy and irresponsible slackers getting their comeuppance. For the most part, these are people who have worked hard and paid taxes all their lives but were unable to afford to set aside resources for retirement. Add on top of this healthcare costs rising rapidly in lockstep with chronic illness rates and you have a looming crisis of unprecedented scale and scope. 

It is past time to stop ignoring this problem because it is already here and is only going to get worse. Attitudes about the "safe and smart" thing being employment need to change and people need to begin establishing their own (perhaps part time) businesses. Side gigs and multiple sources of income need to become the norm. Let's open the discussion.

Seven Legit Work-from-Home Jobs

I have had a network marketing business for over 10 years. I enjoy it and, for me, its been a fun social business and a great supplement to my retirement income. I am fully aware that many people regard MLM with great suspicion, so if you are one of them and are looking for good, part-time work-from-home opportunities that are NOT network marketing, here are some you might want to take a look at. You can view a more comprehensive list on Clark Howard's web site.

Customer Service/Sales Rep  ($10 - $20 an hour)

Tutor ($20+ an hour)

Travel Consultant (up to $30 per hour)

Programmer ($30 - $35 an hour)

Editor ($25 - $30 an hour)

Translator ($18 - $23 an hour)

Data Entry Clerk ($15 an hour)

Note that these are all Jobs and not Businesses. You would be an employee or contractor. Also, some of them may require specialized skills and/or experience. Some tutoring work may require a degree. But all of these are legitimate ways to earn some extra money right from home right now.

Two Myths That Will Kill Your MLM Business

Network Marketing is like just about any other undertaking. Some people succeed and others will fail and everyone is looking for the magic secret to success. Its the same with advice. There is good advice and not so good advice, and just because everyone agrees about something and it comes from your company doesn't make it good advice.

Here are two pieces of advice that I was given by just about everyone when I started with my MLM business. I heard this advice at every company training and event. Unfortunately, it is wrong. And taking it cost me a lot of wasted time and unearned money.

1. Slow and Steady Wins the Race.

“Just keep working it consistently. Do it in your spare time. Weave it into the cracks of your life.”

No! Slow and Steady is the way to starve in Network Marketing. Airplanes do not get into the air at 20% power no matter how long they keep at it. Success loves speed! If you do not get your business to critical mass, it will never be successful.

2. Just Don't Quit.

This is lunacy. Its not enough to just keep at it. 

Network Marketing is filled with people who haven't quit and never go anywhere. This is why the failure rate is so high in MLM. If you are not doing it

right, doing it more will not change your results!

A Good Network Marketer is Always Learning

Those of you who follow my posts here for the health and nutrition information, please excuse me a moment while I speak to the rest of you who are starting or building a network marketing business.

I am a pilot and we have a well worn saying that goes "A good pilot is always learning". I've found this to be totally true, but it is just as true in your network marketing business. Certainly take full advantage of your company's training programs. But if you limit yourself to them you are definitely limiting your growth.

Eric Worre (networkmarketingpro.com) and Ray Higdon (rayhigdon.com) are two outstanding trainers and advocates that you should be a fan of.

Take a look at this short, free and outstanding video about value, contribution and attitude from Ray Higdon.

http://tinyurl.com/y7ukb7um

Then go to their websites and get on their distribution lists.

(NB: I am not a marketing affiliate or financially connected to either of these outstanding people, just a really big fan.)

Changing Lives

Deep inside your heart of hearts, do you really believe that sales is a helping profession? Do you really believe that what you are selling is about changing lives? Over the years, its been a tough thing for me to accept at a visceral level.

If this is something that concerns you (and if you make a living in Sales it really should), check out this sort video from successful sales and network marketing trainer Ray Higdon. Then figure out how to help people stay "around the fire" and build a better life.

 http://bit.ly/M5T8ys

Leveraging That Holiday Lull

Despite the encouraging pressure of making year end goals (usually with a prize or a trip on the line), network marketing professionals often struggle around this time of year. Each day more and more people fall into their "holiday mindset" and essentially end their business year. It becomes more challenging than ever to schedule appointments, and often those that do get on the calendar fail to happen or don't accomplish much when they do. People are done with this year, and not ready to start the next one quite yet. Decisions seem best put off for a few more weeks. What is the ambitious network marketer to do?

Well don't join the herd in writing off the rest of the year. Even though it is unlikely that you will convince anyone to focus very much on your opportunity right now, in fact it is a great time of year to advance your business. How? Do the same thing everyone else is doing - look to next year. But do it with purpose. The year-end holiday season is the perfect time to meet new people. There are family gatherings, workplace parties, social outings and community events of all sorts going on, and there are people you don't know at all of them. But instead of trying to get them to a meeting or a sit down right away, beat them to the punch.

"Hey I'd love to sit down with you and share this right away, but with the holidays I am just slammed. What does your schedule look like after the first of the year?"

You will be amazed at how willing people are to schedule a meeting with you once they understand you aren't pressuring them to do it tomorrow. (Just make sure you schedule it, don't accept "I'll be in touch".) And having a full calendar is a really great way for you to start the new year. So don't slack off over the next two weeks. Instead, set yourself up for a running start into 2014. It won't win you that trip, but it will move your business ahead of everyone who has a "Gone for the Holidays" sign up in their head.

Social Media vs Social Networking

Let's say you've decided to add traditional business networking to your marketing mix. You find a couple of local groups, schedule the time and show up at the meeting with a pocket full of business cards and a well rehearsed "30-second commercial". Now what? Do you rush around handing out your cards to everyone else in the room (Spamming)? Do you monopolize every conversation talking about yourself and all the quirky, fun things you do? Do you give your commercial and then sit in the corner waiting for people to approach you? Is your idea of relationship building squirming in your seat waiting for someone to shut up so you can talk about your business? Probably not. And yet this is precisely how many people try to use "social media" to attract new customers and grow their business.

Back in the days when AOL was credible and MySpace was cool, and Facebook and LinkedIn were just getting started, this whole online genre was called "Social Networking". The recent movie fictionalizing the dawn of Facebook was named "The Social Network". And that is what they were about, people connecting with other people socially online. There are over a billion people using Facebook alone today, and dozens of other popular social systems online as well. So its not surprising that before too awfully long, businesses and their marketing arms moved in. This is not entirely a bad thing. Someone has to pay for these things to exists, and advertising is a well established way of funding "free" systems. It wasn't long after the arrival of the marketers, however, before things morphed from "social networking" into "social media". And the distinction is anything but trivial.

"Networking" is all about establishing connections and building relationships. Its the sort of thing salespeople understand and gravitate toward. "Media", on the other hand, is principally a means of mass communication. A way of taking your message and broadcasting it to as large an audience as possible. A vehicle for advertising. And it is the province not of salespeople but of marketeers.

These days it seems like everyone is clamoring for instructions for "using social media to grow my business". And there is no shortage of consultants and trainers stepping up to meet the demand. Hey, at least someone is making money on social media! And what advice do we usually get? Be active. Post cool, interesting things about yourself - often. Slip in ads for your business every now and then but don't overdo it. Make your profile look like this. Say that. Avoid doing this other thing. Wait till someone says something related to what you do and then pounce. More followers is better than less followers. In short, good marketing advice and bad networking advice. And manipulative.

Let's go retro and start thinking of it as social networking again and leave social media to the social media consultants. Start to apply the same principles and approaches you would use at a networking meeting. Don't wait to be found, reach out to others. Don't just connect with the people you know, or hope people will find you, make the effort to find them. Connect with people you share meaningful common interests with, business or personal, and build on that. Build relationships, whether or not they ever lead to a sale. Have fun and let it show. Be yourself. Look for quality connections instead of just a lot of them. Give back, contribute, offer to help.

I've taken this advice to heart recently and its making a noticeable difference in how I use Facebook and LinkedIn and for the first time ever it is even producing some real business results. Give it a try yourself and see if networking doesn't beat advertising by 2 lengths.

Does Your Downline Have a Game Plan?

Its no secret that the actual success rate for new distributors (lets call "success" a distributor who is still in the business 3 years later and satisfied with their progress and results) in many network marketing companies is dismally low. Ten percent or so is not uncommon. With such a simple business, its reasonable to wonder why this is.

First of all, let us not confuse "simple" with "easy". Network marketing is work, and those lacking the determination and/or work ethic to put some serious effort into making their business successful are nearly always going to fail. (There is simple random luck of course, more on that later.) But what about the people who really take a run at it, invest significant time and effort, and still end up disenchanted and dropping out?

Often it is because they go into it without any sort of game plan for success. In my opinion, this is a failure primarily of their upline/
sponsor, who's job it is to train and support a new distributor and show them how to succeed. But too often this comes down to "Here, watch this DVD, make a list of everyone you know, call them up, set an appointment and let me know when you need my help."

A better way is to have a specific process you use to help your new distributors get off to a good start and experience some success in their first month or two. Network marketing guru Eric Worre calls this a Game Plan. Sitting down with your new recruits and making sure they have a plan for success, that they understand it, that it connects with their own hopes and aspirations and that they know exactly how to get started will go a long, long way toward making them successful and not another droppout. And isn't that what you, their sponsor, want? Their success?

What should a Game Plan address? Just a few basics may make all the difference.

1. Reinforce their decision to join the business.
2. Clarify exactly what their role and your role are going to be going
    forward.
3. Set realistic objectives for their first 15, 30, 45, 60 and 90 days in
    the business.
4. Map out, precisely, what they are going to need to commit to do in
    order to reach those goals and what you will - and won't - be
    doing to support them.
5. What their immediate next step is going to be, how and when
    they are going to get it done.
6. How they want you to support them when you see them starting to
    slip or backslide.

At the end of the day, it is entirely up to your new distributor how they are going to run their business. They don't work for you. But if you want to be successful yourself you need to maximize the chance that the people you bring in will be successful too. Having a clear, realistic plan for getting them a few wins quickly will go a long way toward keeping them out of the failure column. And remember, hope, luck and good intentions are not a plan.

Lost Jobs "Not Coming Back"

"These jobs are going, boys. And they ain't coming back." - Bruce Springsteen, My Hometown

One of the things I hear a lot when out talking to people about my network marketing opportunity is that its just "too risky" to work on what amounts to a 100% commission basis. But more and more its starting to look like the real risk lies in traditional "time for dollars" employment. In fact, "having a job" has been the norm in America only for the last 60 years or so. In 1900, about 90% of the US workforce (including farmers and agricultural workers) were self-employed, held multiple part time jobs, or was a mix of the two. By 2010 that had fallen to nearly 10%. As this Morning Edition report on NPR illustrates, perhaps the pendulum is beginning to swing back.

More and more people competing for fewer and fewer full time jobs paying less and less money with fewer and fewer benefits is not a recipe for worker prosperity. For network marketers, the future has never look brighter.

Attitude is a Choice

People who know me well would not say that I am the most optimistic person on the planet. I've often taken a perverse pride in being a "realist" and avoiding "excessive enthusiasm". As The Who said so well, "If I smile tell me some bad news, before I laugh and act like a fool". A recent experience has prompted me to reconsider my whole attitude about attitude.

I was in Orlando after an exciting Reliv 25th Anniversary International Conference. As I sat in the hotel lobby waiting for my airport shuttle, my phone rang. It was the airline letting me know that my flight was delayed 35 minutes because of a "minor mechanical issue". Uh oh! I've traveled often enough to know that where airlines are concerned there are no "minor" issues, and I had a tight 55 minute connection to make if I was going to get home that day. Noon arrived and no shuttle. A call to the company resulted in an unsympathetic dispatcher telling me that the shuttle had been there, I must have been at the wrong entrance (maybe mention that when I reserved the ride?), and the next one would be by in an hour.

I was now an unhappy person, and spinning all sorts of plausible scenarios in which I didn't make it home till the next day. Then it occurred to me that the 35 minute flight delay just might save the day! Without it the missed shuttle was an automatic loser. 

All along here so far, I was assuming the worst case scenario - several worst case scenarios actually. But why was the best case not possible? On paper, at least, I could still make the flights. So I had a 20 minute argument with myself about it (I must have sounded like Gollum to passers-by) and made a decision that, since these matters were mostly out of my control, I would do the best I could and assume that things would work out for the best.

Suffice it to say that the trip home was much more of an adventure than I'd have preferred. But when I finally walked through my door, I was only 58 minutes later than scheduled. I'd had a chance to meet several people on the way home who were interested to hear more about what Reliv could do for them who I would not have met otherwise. And as I stood in Chicago waiting out weather delays, my new attitude spared me from the stress and anger that was all around me.

But suppose things had not worked out so well? Suppose one of those worst case scenarios had played out? I might well have been presented with new and different opportunities that I would have missed out on had things gone smoothly. Second, the experience could have provided valuable lessons and learning experiences for use next time. And finally, by relaxing, doing what I could and assuming the best, the trip would have been far less stressful and aggravating than it otherwise would have. What was my other choice? Congratulate myself on expecting the worse and being right? Scant comfort that.

The big lesson for me? Attitude is a choice! I can choose to see things from a negative filter or a positive one. I can expect happy outcomes or miserable ones. Being positive and optimistic about things doesn't change the outcome, but it does change the experience. Being a "glass half full" person is just more fun. And I bet it attracts a whole different sort of person to me. Try it yourself.

"It Costs Too Much"

"I'd love to but I just can't afford it."

"I'm pretty sure that I can get it cheaper somewhere else."

"I'm sorry but it just costs too much for me right now."

Anyone who has been in network marketing, or any kind of sales for that matter, for more than a few days has heard dozens of variations of "It costs too much." Is that the end of that sale? It all depends on how you respond.

The first thing to realize is that for most people "It costs too much" almost never really means that they think it costs too much. Instead, they are telling you that you have not communicated the value of your proposition to them clearly, or that there is information they need to make a decision that you have not provided. When you hear the cost objection, your job is to uncover the real issue(s) and resolve them. If they really just cannot afford your product or service, why are you still selling to them? You should have uncovered that key fact in your qualification process.

Once the cost issue has been raised, you need to probe deeper to uncover the real concerns your prospect is raising. Two things you should definitely not do are offer a discount (aka, lowering your income) or get into an argument over whether or not it really does cost too much. Instead, do what you always do whenever an objection is raised in the sales process. Empathize and establish that you understand their concern, maybe shared it at some point, and certainly do not dismiss it. Then get to work asking questions until you have the information you need to address their concern(s). Here are a few that you might find useful.

"Yes, I completely understand. Let me ask you, if the price were not an issue for you, is there anything else that would hold you back from getting involved with the program today?" Isolating the issue this way will often uncover the real objection.

"I understand. Tell me though, in today's market, what would you expect to pay for a product that would .... " Refocus them on what they are getting for the investment, the value they will receive.

"Yes everyone is concerned with controlling cost these days. Have you considered what it might be costing you to not give this a try?" Presumably the are speaking with you because you've indicated your product or service will solve a problem they are dealing with. What is the cost to them of not eliminating the problem?

"Where does this fit with the rest of your important priorities?"  If someone wants something, they can usually juggle around their priorities to get it. They may not have even considered that getting involved with your product or service might save them effort or time or money in other areas.

The important things to remember are:

1. "It costs too much" probably doesn't mean it costs too much if you have qualified your prospect.
2. Empathize! Let them know you really do understand the financial concern.
3. Find out what they really want and re-focus the discussion on how your solution will get that for them.

"It costs too much" is just another bump on the path to "Yes!"

Avoiding Work-at-Home Scams

As a network marketer I am also a work-from-home business owner and a large part of what I do involves helping others start work-at-home businesses of their own. I encounter a high level of skepticism about this, and based on a study by training and employee development company Staffcentrix of Annandale, VA, this suspicion is well founded. Staffcentix says their recent study showed that there are about 60 work-at-home scams on the internet for each legitimate opportunity.

Most scams are easy to spot, but some have become highly sophisticated. Here are a few things that  you should always do to avoid getting caught up in a scam.

1. Avoid up front "membership" fees, and avoid any offer that
    requires you to pay a significant amount of money to join
    (anything over about $50 sounds fishy to me).
2. Research any potential opportunity carefully before you
    become involved. Check out the company behind the offer
    with a thorough Google search and see what others have to
    say about it on sites like WorkPlaceLikeHome.com and
    WAHM.com. You would not start a brick and mortar business
    without doing your due diligence, don't start a work-at-home
    one either.
3. Consider extravagant income claims to be a warning sign. If its
    so easy to do and will make you rich quickly in just minutes per
    day then why isn't everyone already doing it?
4. If the offer comes to you on a phone call, get a name, a phone
    number and an email address and schedule a time to call back
    after you have had a chance to review their information and do
    your own research. If they aren't willing to do this, hang up.
5. Check the Better Business Bureau and the
    Federal Trade Commission web sites to see if there are a lot of
    complaints filed against the company behind the offer. Anyone
    can draw a complaint or two. But a lot of them is a problem.
6. Email is "free" and anyone can send out millions of them. Its
    generally wise to avoid offers that arrive by email. If its a real
    opportunity, and there is some reason to think you would be
    interested and qualified, someone will call you.
7. Does the caller actually do the business that he is trying to pitch
    to you? If not, how good an opportunity can it be?

There are real opportunities out there for people who want a work-from-home job or business. But 1 out of 60 is daunting odds. Ask questions, do your research and use a good dose of common sense and you can find one that is right for you.

Raiding Your Retirement is the New Normal

Retirement isn't what it used to be. Unless you are a government employee, the days of "defined benefit" pensions are long gone. The once near universal retirement age of 65 is largely a thing of the past. And while there are many reasons that a person might work past the age of 65, one of the major ones today is that people simply cannot afford to retire.

Consider a person who wants to have a dependable retirement income of $50k per year. That's a comfortable income, but hardly wealthy. According the to Social Security Administration, the average retiree will receive a benefit of $14,760. The other $35,240 must come from their retirement savings and personal assets. How much does someone need in retirement savings to produce an annual income of $35k? If we make an optimistic assumption that they can earn 5% on their investments they will need to have approximately $700,000 accumulated to generate $35k per year in income without depleting their savings.

Unfortunately the situation for the average about-to-retire worker has deteriorated in recent years. While there has been some recovery of value, many retirement accounts were significantly reduced during the recent recession. Worse, according to the Washington Post, 1 in 4 people are using their retirement savings to pay current living expenses. The number is as high as 1 in 3 for people in their forties who have been hard hid by unemployment. As a result of these factors, and generally low savings rates, that same average person will have total retirement savings of about $56K by age 65. If we assume that same 5% return, that generates an annual income of only $2,800 - a 92% shortfall.

What does this mean in human terms? If you are one of the 34% of Americans who say they plan to live out their retirement solely using their Social Security Benefits you are delusional and should seek qualified treatment. For most of the rest of us it leaves us with three generally unattractive alternatives:

1. Continue to work at least part time for the rest of your life. More
    than 60% of American workers expect this to be the case for
    them.
2. Lower your expectations for the kind of lifestyle you will have in
    your retirement. About 45% of us expect to do this.
3. Rely on charity and the generosity of family members. Ugh.

This does indeed seem like a dismal picture, but those are the facts and the numbers. I would like to throw out a fourth alternative that is well outside the traditional advice - consider starting a network marketing business. Direct selling is not physically demanding, can be scaled to the time, effort and income goals you want to set for yourself, and requires neither a large investment nor any specialized skill or background to start. According to the Direct Selling Association, 250 companies account for 90% of the direct sales volume in the US, so there is a wide range of companies, products and services for you to consider. Find one you like.

Here's a closing thought. If you had a network marketing business that was generating a monthly income of just $3,000 you would have, because of the residual income feature, the equivalent of a retirement account of $720,000. Problem solved.

Five Reasons Why Your Network Marketing Business Will Fail

According to the Direct Selling Association, companies generated about $154 billion in worldwide sales (2011) through network marketing. In the US alone, nearly 16 million people operate a direct selling business and almost 75% of Americans have purchased goods or services from a network marketer. And yet, while many people successfully generate large - even 6-figure - incomes, the majority do not. And large numbers of distributors leave the business, with annual turnover rates over 50%.

With a broad range of products and companies to choose from, among the lowest start-up and ongoing costs of any business, the many tax advantages, and the ability to scale your business to the time you have to invest and the results you want to achieve, network marketing has a lot to offer. But there are many reasons why someone might fail at a network marketing business. Here are five of the most common ones.

1. You don't love the product(s). Network marketing, like any successful sales business, is based on trust and personal contacts and referrals. It is difficult in any case to sell someone something that you yourself do not believe in, but in network marketing it is - if not impossible - a horribly bad idea. If you don't use the product yourself, believe in it completely and feel genuine enthusiasm for what it does for you then others will naturally be suspicious when you propose it to them. "Be a product of your product" is a good rule to follow. Would you be using the product even without being in the business? Your enthusiasm will attract more people than your pitch.

2. Your expectations are unrealistic. Without a doubt, successful network marketers can make very significant incomes while having a lot of fun doing it. Five figure monthly incomes are not uncommon, although certainly not the rule. It is easy to get caught up in the enthusiasm of the business presentation and the excitement of getting started in a new adventure. The Grand Imperial Vizier level Diamond Executive Double Platinum Ambassador almost certainly invested a considerable amount of time and effort into building her business to that lofty level - years, most likely. There is nothing impossible about expecting to grow your business to a six figure residual income. But it is probably not going to happen by next month. Be sure your goals and expectations match the time and effort that you plan to invest.

3. You failed to carefully check out the company. You would not invest in a stock or buy a franchise business without doing your research first, so why ever would you start a network marketing business without checking out the company behind it? How long has the company been in business? Is it public or privately held? Who is the management team and what backgrounds and experience do they bring to the table? What do other distributors have to say? Is the company a member of any professional organizations like the DSA? Has it been a party to any lawsuits or complaints by customers or distributors? You get the idea. Caveat emptor.

4. You do not treat it like a real business.  If you want to grow your network marketing business into a serious income, you have to make it a netWORK marketing business. There is nothing at all wrong with wanting to make just enough income to pay for your own products and perhaps a little extra every month. Lots of people do. But if you treat it casually and regard it as a hobby, you can't also expect much in the way of financial success. You should plan to invest at least as much thought, time and effort into your business as you would into a job working for someone else - and, realistically, a lot more.

5. You refuse to be teachable. If you join a company that has been in business for some time (and, really, there are not a lot of good reasons not to) then it is reasonable to expect that they and their distributors have figured out how best to do that business. Learn from the people who have been successful, copy what they do, and teach the people you sponsor to do the same. It can be tempting to go off and do things your own way, but it will rarely pay off. Embrace the system your company has developed, make it your own and follow it.

Network marketing is a very simple business that doesn't take years of experience and a large investment to start and grow. But that doesn't make it easy (nothing very worthwhile is). Before you jump in, spend a little time educating yourself and your chances of succeeding will increase significantly.

Why We Hate Sales

From time to time, I have the opportunity to give talks to small groups about network marketing. Not for the purpose of enlisting them in anything, but rather to explain objectively what network marketing is, how it works and why someone might want to consider a business that uses such a selling model. I always begin by asking "Who enjoys sales and selling?" Very few, if any, hands go up. I then rephrase the question and ask, "Who would rather gouge their eyes out with a spoon than be involved in sales or selling?" Nearly every hand goes up.

My point is that everyone is engaged in sales and selling. Not everyone gets paid for it. We don't all have a product or service we are selling. But we all sell ourselves in interviews, our ideas to our employers, our vacation preferences to our families. Even the choice of a place to go out for dinner, or what movie to watch involves some selling. Why then does the profession of sales seem to enjoy such a dismal reputation? Why are salespeople ranked right up there with politicians and attorneys and IRS auditors?

I'm sure you can list your own reasons, but here are mine.

1. At one time or another, we have all been annoyed, harassed,
    disappointed or burned by a salesperson.
    People love to buy, but no one likes to be "sold" something. We've
    all ended up buying something from someone who was all about
    what he had to see and could care less what you needed. Had our
    meal interrupted calling you off a list with some incredible offer
    that you would never in a million years be interested in buying.
    Been let down by the quality, utility or value of a product we were
    talked into buying. Twice burned, once foolish. But how do you
    handle this in a different situation? Say you are seriously
    disappointed with an over-hyped movie. Or perhaps you have a
    terrible experience in a new restaurant you try out - bad food,
    worse service, premium prices. Is that the last movie you will
    ever go to see? Do you stop eating out? Probably not. I bet you did
    learn a few things about choosing films and eateries, and that you
    put it to use the next time you take in dinner and a show.

2. It is easy to buy into the stereotype.
    It is a favorite of stage and screen. The pushy, obnoxious,
    insensitive, back-slapping, fast talking, plaid jacket wearing
    salesman who pumps your hand in a crushing grip while picking
    your pocket with his other hand. Most of us would rather give an
    unrehearsed speech to a large audience than to be thought that
    kind of person. And lets face it, there is always a germ of truth to
    a stereotype. But, objectively, of all the sales professionals you
    have met how many were like that? I'm going to guess a pretty
    small percentage. Why? Because people like that don't last long
    in sales any more - if they ever did. They fail and move on, or find
    a new career.

3. We all fear rejection.
     It can be hard to separate the rejection of what you happen to be
     selling from a rejection of you, personally. This is especially true
     if your product or service is one that you are excited about, use
     yourself and really believe in (and if it isn't, why are you selling
     it?). No one likes to be turned down, to hear "No" or, worst yet,
     to be dismissed out of hand. On the other hand we all hear "No"
     from time to time and, so far as I know, it hasn't killed anyone.

Do we "hate" sales only because of fear? The fear of being a bother to others, of being thought poorly of, or of being rejected? I'm certainly not saying that a career in sales is for everyone. But sales can open up all sorts of opportunities - social, professional, financial. In business or in life, nothing much happens until somebody sells something. Good selling is not pushing. It is helping people to solve a problem or obtain a benefit by looking at things a little differently than they have before. Think about that the next time you are advocating for that golf vacation instead of a trip to your in-laws in Detroit.

Retirees Nervous about Size of Nest Egg

Retirement isn't what it used to be - if it ever was. Recently and soon-to-be retired Americans share a host of worrisome concerns and only 39% of them believe that they have or are building a sufficient nest egg to allow them to retire at all. (In fact, studies by Transamerica and others indicate that the real number is probably closer to 5%, but that is a story for another day.) More than half plan to work past the "traditional" retirement age of 65 in the hope of amassing more assets and slightly more than 50% say they will never be able to stop working entirely. As in not ever.

Future health-care costs are the most common worry, cited by 3-in-4 retirees. Not considering any expenses related to long-term care or nursing facilities, Fidelity Investments estimates that the average retired American faces medical costs of $240,000 with a 6% rate of annual inflation. When you consider that the average 64 year old American about to retire has total retirement savings of about $70,000 you can see why people are nervous.

The traditional advice to "save more" is valid of course, but much more so for the 25 year old than the 65 year old. Continuing to work "forever" is certainly an option. If a person has a job that they can still do. Perhaps its time for people to dust off those "network marketing pyramid schemes" and take another look. There is something to be said for a business that allows you to create a residual (i.e., ongoing) income that will last you the rest of your life.

Social Security or residual income? I know where my bet is going.

Doing Your Due Diligence

Its time (ok, past time) to wrap up the discussion of network marketing and why it makes sense for pretty much everyone to at least take an informed look at the business model before deciding if it has a place in your financial future. Like any other business opportunity that you are seriously considering, you need to carefully research, examine and verify that this is legitimate, sustainable and a good fit for you. Here are some of the things I looked for before becoming involved with my direct selling business.

• A product or service that you love, believe in and want to use yourself, regardless of whether or not you enter the business. Because network marketing is based on personal relationships and trust, the odds of being successful with a company who's products you are not genuinely excited about are very low.
• A company that has been in business continuously for at least 5 years. The idea that you have to be an early entrant to make any money in a network marketing business is a variation of the pyramid scheme mentality. A track record indicates stability and attractive products. Network marketing companies are easy to start, and a good many of them never see their second birthday. Also, a company that has been in business for a few years has done the hard work of figuring out how to be successful selling its products, which means you don;t need to figure that out through trial and error.
• A compensation plan based upon sales, not on recruiting. If you are being paid each time you recruit a new distributor into your network, for recruiting them, be suspicious. In many (maybe most) companies, salespeople are paid commissions for the sales they make. Not for hiring more salespeople. Network marketing is no different. Of course you make more money as your distribution network grows. But it should be because a larger network produces more sales. If you are being paid simply for signing people up, regardless of whether or not they ever sell anything, ask yourself how long that can continue.
• A low initial fee to enter the business (under $100). It is perfectly reasonable for a company to charge a "license fee" to become and remain a distributor. They will be providing you a basket of services (tax reporting and collection, company web sites, product distribution, distribution network record management tools, etc) that will have definite value to you and your business. But charging a fee of hundreds of dollars should raise eyebrows.
• Minimal or no monthly purchase requirement. If the product or service offered is a good one, people will want it and buy it. There should be no reason to require distributors to make minimum monthly purchases. The company should be selling its products or services to consumers, not distributors. The cost of supporting a distributor should be covered in the license fee. Walk away.
• Minimal inventory requirement and direct distribution from the company. You want to be selling products, not delivering them. A modest inventory, enough to get new customers started, is reasonable. But look for a company that provides an online and/or phone ordering service for your customers and that ships directly.
• A money-back guarantee on the products AND on the business. You should have an escape hatch if for any reason you decide after starting that the company or the business is not for you. Rather than leave you with a garage full of inventory, companies should have a clear buy-back policy.
• And active, ongoing system of training, support and selling resources. Reliv likes to say that its distributors are in business for themselves, but not by themselves. Any company you join should have a local, active program to train you, support you and connect you with other distributors.
• Direct Selling Association membership. There are no guarantees in life, but membership in the invitation only DSA is a strong indication that the company has and follows ethical business practices. Require it.

Starting your own business always involves some level of risk. This is why most people never do it.  A network marketing may not be right for you, but its unique combination of low start-up costs, flexible hours and long term residual income potential makes it a business model that you owe it to yourself to consider.

Oh no! You're Not Involved in One of Those!

I want to pick up again the discussion of Network Marketing. In previous posts, I've talked about network marketing's enduring image problem, made a good faith attempt to find an objective definition of it, and reviewed what I find to be the most attractive features of a network marketing business. This time I would like to consider some of the most common objections and concerns that people raise about direct selling.

Before getting started though, let me admit right up front that network marketing is not for everyone, any more than being a fighter pilot or a brain surgeon is for everyone. Not everyone is suited to or even wants to own their own business. The timeless advice "Know thyself" certainly applies here.

That being said, here are some of the reasons I commonly hear for dismissing network marketing out of hand.

"Its a pyramid scheme." This from people who regard Social Security as a serious pension program! A pyramid scheme is a fundamentally unsustainable system that involves the promise of payments to participants primarily for the enrollment of more participants into the scheme rather than supplying any real product or service to the public. This objection arises from the fact that network marketing, by its very nature, usually involves recruiting people into the program. But here is the key consideration - are you compensated based upon the number of people you recruit or for the amount of product/service sales your distribution network produces? If no one else ever joined you in the business, would you still make money?

"Its too risky." Generally, the exact opposite is true. Fees for establishing a distributorship are generally quite modest, and most reputable network marketing companies offer a "buy back" guarantee should you change your mind down the road. And really, how risky is employment  (a business in which you have but one customer - your boss)?

"You have to get in early to make money." This is a variation of the pyramid scheme concern. And for a pyramid scheme it is most certainly true. For network marketing companies, just the opposite is usually true. There is a high failure rate among new network marketing companies, so it makes sense to look for one that is several years old rather than just launching. And again, if compensation is based upon product sales and not recruiting, the longer a company has been around the more likely they are to offer good products with a good support structure behind them.

"Its too expensive." While it is not unusual to find the products to be somewhat more expensive than similar products found in stores (quality considerations aside), the business itself is anything but. Overhead is extremely low, initial investments are modest, inventory carrying costs minimal and there are significant tax benefits.

"I don't have the time." People find the time for the things that are truly important to them. Einstein managed to find time to develop the Special Theory of Relativity while working a full time job as a clerk in the Swiss patent Office. A network marketing business is unusually flexible in that people can scale the amount of time they will work on it to their interest and availability. Naturally, people who put in more hours will grow faster, but, again, that is a choice the owner can make.

"I don't want to annoy people by trying to sell them things they don't really need or want." Who in their right mind would start a business selling things they believed people did not need or want? Find a network marketing company that offers products you like, use and believe in. Others will too.

"I (my spouse, my crazy Uncle Elmo) tried it before and never made any money." Did you ever attend a movie that you thought was just awful? Ever have a horrible meal in a restaurant? Did you stop going to the movies? Stop eating out? Learn from the past and do better.

This is hardly a comprehensive list, just things I commonly hear. Network marketing is simply one model for marketing, selling and distributing a product. As such, you should subject it to the same scrutiny that you would give any investment or business opportunity that you might want to consider. Next time we will wrap up this series of discussions by taking a look at what that scrutiny should include.

What's so Good about Network Marketing?

Back in December, I began a thread looking at different aspects of the network marketing/direct selling business. Life and holidays intervened and I'd like to pick that up again. I'd gotten as far as "defining" network marketing before getting sidetracked, and while I may not have (or even know) an "official" definition, "A non-traditional way of selling and distributing a product or service in which the sales force is compensated not only for the product they sell but also for the distribution network they create" pretty much works for me.

Now I would like to take up the question of "so what, why bother?" What is it about network marketing that, despite the bad press and questionable reputation, makes it a uniquely attractive business opportunity? To me there are four key attributes of a reputable and viable network marketing business. And while these may not each be unique to network marketing, they combine to make it a business model that nearly everyone ought to at least take a look at.

1. Generally network marketing has a very low cost of entry. In the case of my Reliv business, $25.00. For companies that have achieved and maintain Direct Selling Association membership (and the best of them do), any initial inventory purchases should be accompanied by a 90%, one year money-back guarantee. Try asking your Coronary Burger franchise issuer for 90% of your money back if you change your mind a few months down the road. Network marketing offers you the opportunity to establish a real business for, often, less than $100.

2. Network marketing businesses require low or no overhead. You have no employees, no storefront, no equipment and, for the most part, not very much inventory. Large parts of your business can be done online and normally the tools you will need to get there are provided, sometimes for a small fee, by your supplier company.

3. Your potential income is unlimited. There really are people making 5-figure monthly incomes in network marketing businesses. As we discussed in an earlier post, that isn't typical. But it does happen. What are you doing now that even offers you a possibility of earning $10,000, $20,000 or more per month next year? Or five years from now? Or ever?

4. Residual income lasts a lifetime, and often beyond. This is without a doubt the most powerful and compelling feature of a network marketing business. That the distribution network you build today will continue to pay you for the rest of your life. Not only pay you, but continue to grow even if you choose to retire from actively working it yourself (most really successful network marketers never retire because they enjoy working this very social business), because your downline network is full of people who are still out building their own businesses.

There are lots of other attractive features of this type of business. No special background or education or training is usually needed, it can be built up gradually without having to leave an existing job until you are ready to do so, and you can set your own standard for success. But these four reasons top my list. If you need to generate some extra income, implement a Plan B for your retirement or just want to take on the challenge of building a business around your other chores and responsibilities it is hard to beat network marketing.

So then, if its so great why doesn't everyone have a network marketing business? We'll look at the reasons why in a future post.