| Company Growth Rate = Distributors Success | | | | prospects. These people have already received |
| Although the statement above is obvious, far | | | | information about the business opportunity before |
| too many MLM companies fail to understand and | | | | you even talk to them. |
| implement, that in an ever changing environment | | | | A good personal and professional recruiting |
| and saturated market, they have to take a more | | | | Website can: |
| active role in their distributors' success. | | | | Beat the 2% - 3% ratio of surfers to prospects |
| | | | Provide high quality leads |
| So let us analyze "mathematically" what is | | | | Becomes a source for the cheapest possible |
| distributor's success: | | | | leads |
| | | | Provide a fresh and unlimited source for leads |
| Distributors' Success Analysis | | | | Having a recruiting website is a must! However, |
| For the sake of this discussion, let us introduce | | | | since no one can expect that a recruiting Website |
| the following three equations | | | | will provide all the leads required from day one, a |
| | | | mix of advertising channels should be considered. |
| Equation 1: Distributor's Success = Company's | | | | Conversion rate: Converting leads to active |
| check | | | | distributors - for some extent - is personal. Some |
| Equation 2. Company's check = Sales | | | | people are more gifted than others and enjoy a |
| Equation 3. Sales = Organization size | | | | higher than average conversion rate. However |
| Distributor's Success = Company's check | | | | when the human factor is isolated, the common |
| While success as an employee is sometimes | | | | denominator remains "technical": How well and |
| subject to interpretation, status, wages, point of | | | | professionally these precious leads have been |
| view or attitude, there is no doubt that for an | | | | handled. |
| MLM distributor, the size of the check received | | | | As time goes by, and the list of prospects |
| from the company is the ultimate yardstick of | | | | lengthens, even the most talented sales person |
| success. | | | | will find it difficult to handle it without an effective |
| Company's check = Products' Sales | | | | management system. |
| At the end of the chain there are customers | | | | USA MLM Market |
| who buy the company's products. The company's | | | | Here is a snapshot of the USA market: |
| turnover is the sum of all these sales. A | | | | 2000 Companies |
| percentage of this turnover is used to pay the | | | | $28 Billion annual turnover |
| company's sales force - the distributors. This | | | | 13 million distributors |
| system of remuneration is the company's | | | | Being one of the most competitive and |
| "Compensation Plan". | | | | saturated markets worldwide, MLM companies |
| Products' Sales = Organization size | | | | need to make sure that their distributors are well |
| Distributor's commission is derived from the | | | | equipped when they approach potential customers |
| overall sales of their organization according to the | | | | and prospects. |
| specific compensation plan. On average, the | | | | Traditional Support to Distributors |
| company's turnover divided by the total number | | | | Usually, MLM companies provide some support to |
| of distributors in the company represents the | | | | their distributors. This support can be divided into |
| average sales per distributor. | | | | tangible and Non-tangible support: |
| Hence, the number of distributors in ones | | | | Tangible |
| organization determines - on average - the | | | | Training |
| company's check size, or: | | | | Marketing material (brochures, product |
| Distributor's Success = Organization size | | | | information, surveys, articles....) |
| The New Distributor: Situation Analysis | | | | Incentives |
| Beginners have a lot on their plate. To become | | | | Non-tangible |
| successful, they have to master all aspects of | | | | Communication between its distributors |
| their new work: Company, products, sales, | | | | Information (down-line performance, own |
| systems, etc. To boost their confidence in their | | | | production, commission, Flow of business etc.,) |
| new line of work, they need an early success. | | | | Organization culture, sense of belonging |
| To start growing their organization, they need | | | | The above support, as much as required, is only |
| the tools and framework to enable this early | | | | part of what a distributor needs to succeed in |
| success. | | | | today's competitive market. |
| Since most distributors lack this much required | | | | The solution |
| framework, it does not come as a surprise that | | | | We now go back to the beginning of this article: |
| currently 80% - 90% of them dropout in the 1st | | | | Company Growth Rate = Distributors' Success. |
| year. | | | | When a company decides to play a more active |
| Organization Manager: Situation Analysis | | | | role in its distributors' success, it can now add to |
| Once a distributor has added a few new | | | | its support mix, a recruiting and management |
| down-lines, he becomes an organization manager. | | | | system. This system will provide: |
| Since dropout percentage is high, organization | | | | A framework for new distributors |
| managers are in constant pursuit to recruit new | | | | A possibility to manage organization |
| distributors on one hand, while maintaining and | | | | Competitiveness in a saturated market |
| supporting their existing organization. | | | | Save time and money resources to its |
| The need to control their administration and sales | | | | distributors |
| time-share, becomes a major issue. | | | | Lower the dropout percentage |
| Growing an Organization: Facts | | | | The Company's Benefits |
| Let us deal with the harsh facts which, governs | | | | When company uses its buying power to |
| the building process of an MLM organization: | | | | implement such a solution it can achieve the |
| Fact #1: 2% - 3% of people exposed to the | | | | following benefits: |
| business opportunity become prospects. This | | | | Saves time: Comprehensive professional solution |
| figure relates to the best recruiting Websites | | | | is available now |
| where figures can be measured. The figures are | | | | Tailors the solution to its needs |
| much lower when using other advertising channels | | | | Increases growth rate and distributors loyalty. |
| such as newspapers, stickers, flyers etc. | | | | Increases bottom line at no cost.Summary |
| Fact #2: 1% - 2% of prospects become | | | | Let us summarize the arguments in this article in |
| distributors. This is an average figure and depends | | | | a few short sentences: |
| on many factors. Some of them are personal | | | | 1. The company success is derived from its |
| factors, where others relate to the lead's quality | | | | distributors success |
| and source. | | | | 2. Distributors success is directly related to the |
| The bottom line is simple: A distributor has to | | | | size of their organization |
| expose his business opportunity to some 1000 to | | | | 3. New distributors need a framework that will |
| 1500 people to recruit ONE (1) down-line. | | | | enable them to achieve early success. This will |
| Conclusion: Recruiting is a numbers game! | | | | reduce the current high dropout percentage |
| Winning the Numbers Game! | | | | 4. Organization managers need a system to |
| To win the numbers game two components - | | | | support their organization and as a mean to lower |
| exposure and conversion rate - has to be | | | | the dropout of new recruits. |
| increased! | | | | 5. Building an organization is a numbers game. To |
| Exposure: There are many channels of exposure | | | | recruit 1 distributors 1000 people has to be |
| to the business opportunity: business cards, flyers, | | | | exposed to the business opportunity |
| publicity buttons, stickers, Newspapers, Internet | | | | 6. Winning the numbers game, can be achieved |
| ads, recruiting Website - to name some. | | | | by increasing both exposure and conversion rate. |
| However, before practicing a specific method, the | | | | 7. The market is highly saturated and |
| following important questions have to be asked: | | | | competitive, and the traditional support provided |
| 1. What is the cost effectiveness of this | | | | by MLM companies is not enough. |
| method? How much time and money I need to | | | | 8. Companies should use their buying power to |
| invest to get 1 lead (prospect)? | | | | provide their distributor with current technology of |
| 2. What is the quantity of prospects I can | | | | recruiting and management system to accelerate |
| achieve using this method? How many prospects | | | | growth and benefit from distributors loyalty. Nili |
| I expect to add to the pipeline in a month? Is | | | | Raam is a renown expert in her field in Israel, as |
| there a limit to the number of prospects I can | | | | a Communication Consultant for business, |
| find this way? | | | | professional and executive improvement. She is |
| 3. What is the prospects' quality this method | | | | author of a few published books and many |
| produces? High quality leads are informed | | | | articles. . |