It’s very well known in the home based business and network marketing industries that over ninety-nine percent (99%) of new business opportunties do not last more than two years.
Unfortunately, this fact is not well known enough, especially to people who have less experience in the home based business arena. Too many people are attracted to the glitz and the glamour and are caught up in the emotion of new products, explosive income and make big gambles and lose.
New home based business opportunities pre-launch or launch just about everyday. In October 2009 alone, over twenty-five (25) new home business opportunities were listed by the website Npros.com – a home business resource. The vast majority of them will close their doors before they are even two years old.
Some startups are designed to fail. They are scams, designed to make the founder a quick buck before he disappears off the face of the planet, only to start another one under a different alias. But many opportunities who startup with a bunch of “me-too” products don’t stand the test of time because the founders do not have a clue of what they’re doing.
Residual income can only be built in a company that can last for the long term. There are two indicators that you can use to see if a company will be around for the long term.
- How long has the company been operating for? More specifically, has it been operating profitably for more than two years?
- Is there consistent and increasing demand for its products and services?
Ninety-nine percent of startups will fail in the first two years. So if a new company can last that long and show a profit, it has a good chance of surviving for the long term.
If you’re planning to make some money for the long term with network marketing, do not join startup companies. Make sure they have stood the test of time, otherwise you’ll have to build it over and over again. Ninety-nine percent of new startups fail in the first two years! The cards are stacked against you, its simply not worth the risk.
If a great opportunity is launched, it should be a much better opportunity after two years, after it has stood the test of time and the company has streamlined all of its processes. It’s pure logic. Don’t fall for the trap of get in on the ground floor and “now is your only chance”. If people say the startup phase of a new company is the best time to get in, doesn’t that mean it won’t be as good when it is established?
Make sure that the products that the company sells has relevancy in the marketplace. Make sure the products have long term residual value. Household products, cosmeticsskin care, health and wellness products have stood the test of time because need these items.
A good example of what to avoid is Excel Communications, who filed for bankruptcy in 2004. Excel sold discount long distance phone calls through an MLM pay plan. Today, you can’t make a business selling long distance because it’s free. Technology has made long distance communication free for everyone.
Another example was the craze about video email a few years ago. Thanks to Google and Yahoo, this is now free and higher quality. If really want a business opportunity centered around technology, make sure the company providing the opportunity is always ahead of the curve. Technology becomes cheap and obsoletely very quickly.
To your MLM success,
Wayne Wu
P.S. I would love your input! If you have an opinion that would contribute to this discussion, please leave me a comment below.
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