Why Network Marketing Makes Sense

Almost everyone when asked if they would prefer to be in business for themselves or continue to work a job will say they would prefer to be in business for themselves.

Many of those same people however don't have the time, capital, and more importantly the knowledge on how to effectively run a business of any sort let alone start their own. That's where network marketing comes into play

Becoming an Entrepreneur

When considering becoming an entrepreneur a few things have started to happen. First, you are probably realizing that you were not born with a W-2 form attached to your birth certificate.

Second, working a job is okay initially if all you want to do is make a living, but is not ideal if you're trying to make a life.

And lastly, you really are not control of your own income if you're working for someone else. You've heard the famous joke about the guy who said he was his boss's right-hand man and as such could not get fired. Well soon after that statement his boss got left-handed really quick.

So what business could you start? How do you know what type of business or industry you want to get into? Where do you learn what it takes to be an entrepreneur and business owner?

You might want to consider network marketing as this business model will answer all those questions and then some.

An Entrepreneurial Shortcut: Network Marketing

Robert Kiyosaki is an investor, businessman, self-help author and motivational speaker and is best known for his Rich Dad, Poor Dad series of motivational books and other material.

In his book, Business School, he affirms: "If I had to do it all over again, rather than build an old style type of business, I would have started building a network marketing business." Strong statement from one of the world's most sought after entrepreneurs and business minds.

But what is it about Network Marketing that makes it so attractive and why should it be the first choice for people looking to get into business?

Here are some key reasons why network marketing is very attractive to new entrepreneurs.

Capital

Most network marketing businesses are very easy to get involved in and typically have a very low start-up cost. So there is no real risk of losing any money at the forefront and if you find the business is not exactly what you were looking for there is usually a money-back guarantee on your registration. Investing millions of dollars in a franchise just to get it off the ground is much more daunting than a couple of hundred bucks to get started in your own business.

Training and Support System

Most people don't have any knowledge on how to build a business of their own because no one is taught how to do this in any formal form of education. The education system is set up to teach people how to get a job and is more focused on developing skills. Jobs require skills but business ownership takes mindset. Most network marketing businesses have very extensive personal growth programs and support materials to help you make that transition from a job mentality to a business-ownership mentality. I recommend not focusing on the products of the business but their education program. Even if you do not make much money with your involvement, the education you receive will be worth the time invested.

Low Risk

Network marketing businesses are designed to be built during the spare time of the person looking to become an entrepreneur. So it is not possible to participate in a lot of these businesses full time like a conventional business or job. Because of this, there is no risk to what you may be currently pursing as a profession. It takes much more risk to totally stop your current form of income to pursue something that you have no real knowledge about with no guarantee of income in the future. A network marketing business will give you that flexibility to keep your day job but create the lifestyle you really want during your spare time. The famous saying is "You make a living from 9 to 5, but a life is made from 5 to 9."

No Limit to Potential Earnings

Once you understand how the business is run there is no limit to how much income you can create in a network marketing business. Because most of these businesses are focused on direct sales of products and services, you can outperform any distributor based on your own work ethic and your own effort. It is strictly performance based.

This is usually tough for most people who are used to showing up to work, surfing the internet for 8 hours and then getting paid at the end of the week for doing an average job at work. Networking marketing will teach you the hard lesson about what real business is about: you want a raise, you give yourself a raise. If you're not making money it is no one else's fault but your own.

How to Choose a Network Marketing Business to Partner With

Robert Kiyosaki also encourages people not to focus so much on the products that a network marketing business offers but to focus on some of the more intangible characteristics. In his book Business School, he affirms once again that he endorses any network marketing organization that is "first committed to developing you as a human being, more than developing you into a salesperson."

He reiterates that people should seek organizations that:

• Are proven organizations that have successful track records and a distribution system and a compensation plan that has been successful for years.
• Have a business opportunity you can succeed with, believe in and share confidently with others.
• Have ongoing, long-term educational programs to develop you as a human being. Self-confidence is vital on the right side of the Quadrant.
• Have a strong mentor program. You want to learn from leaders, not advisers. People who are already leaders on the right side of the Quadrant and want you to succeed.
• Have people you respect and enjoy being with.

According to Kiyosaki if the organization meets these five criteria, then and only then look at its product. Don't take my word for it, take his. Good luck!

Why Affiliate Marketing

Business are generally very difficult to get up and running.

Making a profit is not usually a short-term goal and in reality most conventional businesses are lucky if they can even get into the black the first two years.

Affiliate marketing represents a business opportunity that can be profitable in a very short timeframe.

Affiliate marketing is an Internet-based marketing practice in which a company rewards numerous other businesses for each referral business brought about by their marketing efforts.

It is a form of online marketing which is frequently overlooked by advertisers but more companies are starting to realize just how revolutionary this marketing strategy is. While search engines, e-mail, and website syndication captures much of the attention of online retailers, affiliate marketing carries a much lower profile.

For entrepreneurs however affiliate marketing is a very attractive industry to currently get informed and educated about. The social networking website buzz that hit the business world recently is a direct result of this.

Young kids in their early twenties are becoming multi-millionaires by simply tapping in to the concept of providing different revenue streams for different companies as long as the different affiliate companies use them for their advertising. It is ingenious and more importantly it works.

Amazon.com is a great example of what an affiliate marketing business can accomplish in a short period of time. They have used their affiliate program to drive online sales, and in the process have made a ton of money for all of their affiliates.

The Amway-Quixtar Corporation is another one of the better affiliate marketing business models and taps into a huge alliance of companies which aid in the servicing of their customers. There are plenty of affiliate programs out there to chose from. Affiliate aggregators like Commission Junction allow you to tap into literally hundreds of affiliate programs for free.

So what makes this affiliate marketing business model so appealing to companies, customers, and budding entrepreneurs alike? Here are some key points about affiliate marketing.

Multiple Products

Probably the most important benefit about affiliate marketing is that it gives the parent corporation access to a variety of products and services. When asked usually about a website like Amazon for example and what products they sell the answer is usually this: everything.

The question really should be "what don't they sell"? Because they partner up with so many different companies and give them a platform that they can use to get the word out about their products. Amazon used to only sell books but now they sell almost anything you can find in a mall.

A Business That Is Not Expensive to Start

This is important to understand about affiliate marketing. This business model gives both large companies and individual entrepreneurs who are looking to dapple in small business the opportunity to do so. For big companies, forming or becoming part of an affiliate marketing program usually requires certain criteria be met but once this is taken care of the company now has access to a client base it otherwise wouldn't have.

With regards to small business owners, to participate in an affiliate marketing program is usually just s couple of hundred bucks. For companies like Amazon it is free, and all you have to worry about is the distribution end which isn't usually expensive.

Support Systems Are Available

Biggest fear about getting into business is the lack of knowledge or technical know-how involved in building and operating successful business. Affiliate marketing programs are usually privately owned and funded and have their own proven training and support system that you can plug into to learn everything you need to know about running and working that particular business.

The key term here is that they are "proven" systems, which means they work as long as you do the work to get the results.

Performance-Based

The most exciting aspect of affiliate marketing programs is that you get paid strictly on your own performance and how much traffic you can drive through the portal. The greatest part about this is that the income potential is limitless.

You earn what you work for which is very appealing to most people looking to get into business but aren't ready to make the heavy investment that is required to get into conventional business.

Wal-Mart and Distribution

Wal-Mart is more than just a success story.

It is the largest grocery retailer in the United States, making up about 20% of the grocery sales market last year. As a business, it is ranked number one in revenue when compared with other public corporations. There are so many more accolades to list but it is safe to stop here and just say that this company is not going anywhere in the near future.

The most intriguing aspect of Wal-Mart is that it specializes in non-glamorous products. The company is in the distribution business and is, if not the best, one of the best at it. You can find almost anything in Wal-Mart and at an affordable price. Their business model focuses on buying in bulk at a discount and selling products at a much cheaper price than its competitors.

Okay so we know Wal-Mart is in distribution, we know they are absolutely dominating the market right now, and yet they do this by selling products at the lowest prices possible. What is about the distribution market that makes a company like Wal-Mart continue to improve its revenue every year since the 1960s?

Distribution is not limited to one market

This is probably the best part of being in the distribution business and Wal-Mart's discount business model only makes this better. Big warehouse grocery stores like Wal-Mart, Costco, Hannaford, etc, all have the ability to expand their product inventory because of this simple reason: they distribute everything.

You can find products ranging from perishable items like eggs, milk, meat and poultry, to bigger warranty items like tires, television sets, dishwashers and bed frames. Because Wal-Mart is not limited to one market they have the ability to sell whatever consumers want. Imagine being in the VHS cassette tape market just two decades ago.

You were making a lot of money in the early eighties to early nineties. But right now if you were still in the VHS business you would be bankrupt and out of business. Compact Discs and DVDs have revolutionized that industry and cassette tapes couldn't be any more obsolete. Wal-Mart's strength lies in its ability to sell whatever is hot on the market. If consumers like Mp3 players then Wal-Mart will start to distribute Mp3s.

Distribution helps you leverage what is hot in your favor because you are not in manufacturing so have the leeway to move in and out of the supply chain wherever it is convenient from a profit standpoint.

Disintermediation: Middle-men can be eliminated

In every supply chain there are multiple intermediaries that aid in getting the product or service from the manufacturer to the consumer. The only challenge here from a business standpoint is that as a result the amount of profit potential possible to the eventual retailer is small compared to what they otherwise would get to keep if they owned the whole distribution chain.

With the advent of the internet a lot more of the intermediaries that used to be deemed irreplaceable in the supply chain can now be replaced and their profit shifted elsewhere. Wal-Mart's business model eliminates the wholesalers and jobbers and lets them access the manufacturers more directly. This is why they are able to offer a wide range of products at very cheap prices.

If the products were allowed to pass through the hands of the other intermediaries then the price would have to go up because Wal-Mart would have to incur the cost of paying the jobbers and wholesalers. So distribution gives you the ability to access certain links in the supply chain based on your company's competitive advantage and eventually eliminate some of them so you can keep more of the profit.

Internet makes the world an even bigger oyster

The internet has without a doubt revolutionized the way we do business today. There is no question about that. The distribution industry is no different and Wal-Mart like other companies is leveraging the ability the internet has to reach a worldwide audience.

For a long time Wal-Mart was the middle-man for most large-scale manufacturers. But ever since the internet came along the internet essentially replaced big warehouse distributers like Wal-Mart and took the place of middle-man in the distribution world. More and more companies are not just lining up to get a website, but also are looking to develop a larger customer base online.

The three biggest expenses for almost every company are advertising, employees, and overhead. What the internet has enable distribution companies to do is cut down costs tremendously in all those three areas. Not good news for people looking to work for these companies, but very good news to the owners.

Most effective advertising online is through word of mouth and referrals. So making the transition from conventional stores to online shopping for Wal-Mart has been a piece of cake. More and more people are getting used to shopping online and it is fast-becoming the more prevalent way to shop now. There are projections that by the year 2010, 30% of all revenue generated through distribution will be captured via the internet.

You can expect that these distribution companies are enjoying the costs that the internet is helping reduce and the profit potential it brings.

Be rest assured that distribution is not going anywhere. There is a lot of profit to be made in any part of the supply chain but perhaps the most lucrative today would be in the actual contact with consumers.

The future belongs today to the company that can get products to consumers faster and without the help of additional intermediaries along the way. Wal-Mart is doing this and doesn't look like they are slowing down. They aren't concerned with innovation because they let the consumers dictate what their inventory looks like. They access manufacturers directly and as such keep more of the profit when the final sale is made.

For those of us thinking about getting into the distribution business, hopefully this stimulated some ideas. The further down you are in the supply chain the better. Manufacturing is probably not the smartest industry to get into, but the service industry is continuing to produce more opportunities for budding entrepreneurs.

Referral Marketing

Business only works if marketing is involved because it is the marketing strategy that ultimately determines how much potential profit can be captured.

The challenge in marketing is usually how much of the limited budget most startup companies have should be used in advertising.Conventional advertising is expensive and is not a guarantee that an audience will purchase your product. It does, however, give you a chance to get your product or business or service out to the public and create a pull towards your business.

Referral marketing or word of mouth advertising is a new trend that is taking the business world by storm. It is simply a process by which consumers share their knowledge about a particular product or business with other fellow consumers and this continues to grow and eventually expand the market coverage for that product.

The movie industry is notorious for using this method of advertising as most movies tend to release previews a month in advance to the movie opening and then the preview showings are completely stopped. They then rely on the movie viewers to continue spreading the word about the movie and so their advertising budget does not need to be over-extended.

As an entrepreneur and business owner, referral marketing is a good method of advertising to adopt as even your primary method of expanding your market coverage for a number of reasons.

Inexpensive

The best part about referral marketing is that it is inexpensive. This is simply because the people who are advertising for you are doing it voluntarily. A lot of the social networking websites like facebook.com, myspace.com, youtube.com and the like are all booming as a result of referral marketing.

According to consumer reports, 57.7% of all products purchased online in the year 2007 were because of word of mouth. That's more than half of the revenue generated online in a whole year. This goes to show you that if people like a product not only will they buy it but they will talk about it and encourage other people to do the same.

Self-Perpetuating

The nature of referral marketing is that it continues to expand by itself without any external force applied. The law of inertia states that an object in motion stays in motion. Well in this case, once you get this started it will continue as long as people are enjoying your product or service.

The famous e-mail account Hotmail.com was started in a similar fashion. One person created the concept of free e-mail but required that if you signed up for it that you had to refer at least ten of your friends.

After a year he had over one million people in his network and then Bill Gates came along and purchased the rights to his already built network. Now I don't think Bill Gates would have needed help building his own network so why did he pay this kid over $400 million for it? Because it was a "self-perpetuating" subscriber base. It was growing regardless of what was going on because it was free and people liked the service.

That is the power of referral marketing.

People Carry More Credibility

Here is the big takeaway for why referral marketing works: people do the advertising. People will naturally have more influence than any other conventional form of media advertising like billboards, television ads, newspaper ads, etc.

If you think about the products you are currently using now, you probably did not get convinced to use the brand of toothpaste you use because of a commercial on television. It was probably your mother that told you it was the best one and you took her word for it.

That's the key: you took her word for it. People carry more credibility because they are actual users of whatever it is they are promoting. The same goes for the movie industry example. If you saw a movie you really enjoyed you would have no problems referring to someone else with enthusiasm. Same goes for a movie you really didn't enjoy.

But here's the reason why this is so effective: if you saw a fantastic preview to a movie and decided to go see it and a good friend of yours told you it wasn't worth your time, you probably wouldn't go see if even though the preview was good.

The credibility from your friend outweighed the credibility of the conventional form of advertising.

Referral marketing works if you know how to access it and use it for your own personal business. Sure you might have to initially spend a little money and dapple in conventional advertising as your primary source for getting market coverage, but in the end happy consumers will always bring you happy consumers. Good luck!

Key Characteristics of Goals

An organization without a goal is like a ship without a rudder.

It will drift and not drive and will misconstrue activity with accomplishment. Goals keep you moving in the right direction. As you continue to grow your business, it will become apparent that progress has much to do with direction and much less to do with speed. Without goals, you may be moving really fast in the wrong direction.

But just how does one go about setting goals? As the owner or leader of a start-up, here are some things you must consider when setting goals.

Goals must be realistic

Setting a goal you do not believe is feasible is like starting a race you don't expect to win. Why start the race in the first place?

What usually happens when a goal is set that is not feasible is this: nothing. Usually most of the time is spent thinking about how impossible it will be to achieve the goal that absolutely nothing gets done which just leads to more frustration.

It is important when setting goals that you stay realistic and have a feasible way to accomplish the goal that has been set. This is not to say that the goal should not stretch you or your company to become better, but it should not be so daunting that people just freeze and become unmotivated. A good goal will always keep people motivated. An unrealistic goal will keep people stagnant.

Goals must include everyone

This second point is directly tied in with the first aspect of goals which is that they should be realistic. So it goes without saying that if a goal is to be realistic it must include all aspects of the organization.

To take this a step further, if the people in your organization do not believe something can be done then it is either up to you to build their belief that it can be accomplished or to readjust and reset the goal. Sometimes leaders feel that they must always be at the forefront of the decision making. In reality some of the best decisions, especially on goals, are made by going down in the management hierarchy and asking the very people who will most likely be doing most of the work. Make sure when goal setting you remember this.

Goals should have different ranges

One of the biggest mistakes when setting goals is to focus too much on the end result. It is important to begin with the end in mind but do not forget the beginning is just as, if not more, important than the end result. You should make sure when setting goals to split them up in order to be effective. You should have first your long-term goals. This may range from one to two years, to even five years. Yearly goals should be next, then quarterly goals, monthly goals, weekly goals, and ultimately daily goals.

Daily goals are usually the toughest to manage and stay consistent with and rightly so. If you can stay accountable to your daily goals and gradually progress to your weekly goals, you will see a dramatic change in your results and success in completing your goals.

Goals need to be communicated

This is vital in order to produce the maximum effort of everyone that is part of the organization. If the leader has a vision that is not shared with the rest of the organization then it does not qualify as a vision. Goals not communicated to an organization are as good as nothing.

Everyone should know what is expected of them to know how much effort to give and no when to push even harder. The management of short-term goals should be left to the individual leaders on the team but the communication of the long-term goal should be done by the leader of the entire group.

Internal Recruiting

Internal recruiting seeks applicants for positions from among the ranks of those currently employed in the company.

With the exception of entry-level positions, most organizations try to fill positions with current employees. The Internal Recruitment is the most favorite source of candidates in the stable and developed companies for a number of reasons, so it may not be the first choice for a new business still in its inception phase.

Internal recruiting is not better than external recruiting necessarily. Both the recruiting methods however have pros and cons, benefits and pitfalls that you should be aware of when deciding which recruitment method to focus your company around. Here is a quick look at some of the advantages of internal recruiting.

Cost-efficient

Internal recruiting first and foremost is less costly and quicker than an external search process for applicants. There is a considerably lesser need for advertising as all positions available are either posted on the company website or on bulletin boards in the office of the company. Since everything is done in-house it is easy for both the applicants and the HR department to carry out the process of recruitment.

Better knowledge of internal applicants

Another advantage to the firm is that Human Resource data is immediately available for any employee recruited internally. And even more importantly, the employee's work habits are known and previous performance appraisals are on record so it makes it easier to evaluate the applicant.

Requires a short induction training period

An internal recruit will be familiar with the firm. This employee will be familiar with the firm's products, clients, organizational policies, and corporate culture. As such, the firm might be able to save money by cutting down costs as orientation sessions for such an employee may not be necessary. The internal applicant will also assimilate faster into the position because the challenges that external applicants have off adjusting to corporate culture is non-existent.

Improves morale

Internal recruitment may lead to increased morale for employees as the organization is perceived to reward good performance or loyalty. The employees are not pressed to look for opportunities on the external job market. Often, one promotion leads to another vacant position and this chain effect contributes further to increased morale. It encourages healthy competition between employees driven strictly by performance and results.

The disadvantages to internal recruiting are very closely related to competition within the workplace which is understandable. So a lot of care must be taken by management to ensure that promotion from within is very fair and just with no favoritism occurring during the process. Here are some of the key disadvantages to internal recruiting.

Resistance to change

Continuity is not always such a good thing in the case of internal recruiting. If the organization has deiced to change its business strategy, for example, entrenched managers are probably not the "change masters" you want.

One theory of internal recruiting is that the approach simply self-perpetuates the old ways of doing things. This problem is popularly coined "Managerial in-breeding". Sometimes this resistance to change will come about as a result of a personal connection to the old method or process of doing things. Some managers do not want to see the work they started get altered or hanged by another person or authority.

Discontentment among employees

This is usually the biggest challenge among employees. No matter how hard management tries to make sure everyone has a fair shot at being promoted there will always be disgruntled employees who feel shafted or side-stepped. They never feel it has to do with the fact that this person who is getting promoted is perhaps a batter performer than they are. This usually affects productivity and morale in the short-term until the person becomes fully assimilated into the position and a new relationship is established.

Don't count on your employees being excited about everyone else's growth but encourage them to be excited because they also have the same opportunity.

Affirmative action goals are more difficult to achieve

Most companies battle with affirmative action goals and this task is made doubly difficult in a small company that uses internal recruiting as its primary recruiting method. To fulfill the quota for diversity candidates from within is tough if you already do not have enough staff from diverse backgrounds. In most cases the only real option is to recruit from outside sources.

Hard to do with rapid growth

The inertia states that an object in motion stays in motion. Another way of looking at this is if it isn't broken, don't try and fix it. In business momentum is precious, and when an organization is growing rapidly the last thing you want to do is mess up the synergy. Promoting from within during times of rapid growth can throw the synergy out of whack and put a halt on the regular proceedings. Try and stay away from internal recruiting during times of fast growth just because there is not enough time for people in new positions to fully assimilate and understand the requirements of their new positions.

Dressing for Success

The famous saying in business and networking is "You only get one chance to make a first impression".

In business, this is not just a mere quote, this is a fact.

Most people size up someone they meet for the first time in the first five seconds of meeting them. Certain things are unconsciously observed within those first five seconds that can either break or make that connection a good one.

Here are some of the most important things to be sure you have in order when meeting a business prospect, giving a business presentation, attending a conference, attending an interview or any other type of business engagement that involves meeting people.

Proper Business Dress

The safest bet for men is always a suit. Style doesn't matter too much, but the suit should be well fitted with the appropriate lengths for both the pants and the suit jacket. Dark colors like Black, Navy Blue and Smoke Grey are preferable over any other colors with a white shirt as a background. White is universal and goes well with any suits and any ties. The back of the pants should rest comfortably at the base of the shoe but not touching the ground with the front of the pants resting comfortably on the front of the show with little folding.

The arms of suit jackets should not pass the wrist and preferably should be at least three-eighths of an inch from the wrist to allow the shirt sleeves to show up from under the suit jacket which gives a very professional look.

Ties should command respect like solid red, pink, something that stands out noticeably. Make sure that the tie does not pass over the belt buckle of the pants but isn't too short either.

For women, dress suits are very professional and are really a step up from pant suits. Pant suits should be used for semi-formal wear. And remember to always wear pantyhose at all times. For dress suits, it is important that the skirt not be too high and the top of the shirt not be too low. If the budget is limited for both men and women, purchase two good suits and alternate the shirts in the case of the women and the ties in the case of the men.

Hair

For men, less is always better. Hair should not be distracting. Long hair does now go well in business. It might be popular in the younger generation but in business is just looks silly. How many CEOs do you know with long hair?

Make sure that if you use hair gels or pomades that it is used in moderate amounts. Facial hair is fine but it is safer to stay clean shaven with no sideburns. Most people feel a man with a beard or a moustache has something to hide. Sounds silly, but why let a little facial hair keep you from establishing credibility with a prospect who shares that superstitious view.

For women, hair should be neat no matter what the style is. Once again, any hairstyle that is too distracting should be discouraged.

Nails

Nails are one of the first things people notice. Make sure that fingernails are cleaned and manicured. Biting of the nails leaves the fingernails looking very unkempt. If you are in the habit of biting your nails, stop!

Women should be careful not to wear their nails too long. This is fashionable outside the business world but could be a turn off or distraction in a business setting. You probably couldn't give a proper handshake with fingernails the size of French fries anyway.

Jewelry

All visible piercings in men should be removed. Once again, this may be popular in the younger generation but it sends a different message in the business world. Ear piercings, lip piercings, nose piercings, any type of piercings are not to be worn. Watches with chain straps are fine but should be properly fitted around the wrist. Leather straps work perfectly as well.

Women can wear ear rings but should stay on the conservative side. Pearls are a popular choice for dress suits in women but other types of necklaces are fine. The word here is conservative. Less is always better.

Teeth

Dental is expensive, but can go a long way to ensuring you make a good first impression

A smile always attracts people, but a good-looking smile is always a winner. If you have any gaps or deformities in your teeth see if you can get braces quickly to close the gaps and give you a dashing smile. Whitening your teeth is also a good investment. This gives your smile a sparkle.

When you have good teeth, you want to smile and you want to meet new people. It gives added confidence and your prospects will feel that.