Recently I received an email from a visitor to my blog. He asked me about my opinion on his company, especially its compensation plan. I sent him some training material provided by Mentoring For Free that allowed him to do his own assessments of his company.
Here is part of his letter to me after he had gone through the training materials and saw for himself what he was in for…
Hi Wayne,
Thank you so much for your assistance. What an eye opener! Here I am wondering if the company has a good compensation plan when I should have been more concerned with how the company could discard me. Although I believe in the product, and the need for the product, I no longer believe in the company. Especially with clause X on page 2 of their “Terms and Conditions” policy, that’s about as straight forward and simple an “out clause” as you can get.
The information you are providing should be mandatory for anyone considering investing their time and money into any MLM offering. Hopefully as your word grows it will become increasingly difficult for crappy companies to con people into joining them. The public (myself definitely included) are way to trusting, or (like me) looking at the wrong thing. As you covered with your first recorded call, if the foundation is sand – my house will always be in trouble.
I thanked him for taking the time to absorb the training and taking action. He got something that most network marketers don’t. He was able to see beyond the emotion of the product and business opportunity and see what the company really is all about.
Here’s what Clause X of the Terms and Conditions says…
The COMPANY reserves the right to terminate all Distributor Agreements upon 30 days notice if the COMPANY elects to: (1) cease business operations; (2) dissolve as a business entity; or (3) terminate distribution of its products and/or services via direct selling channels.
Lo and behold, just a day later, on March 17 2010, iLearningGlobal, an MLM company which has the exact same clause in their Terms and Conditions, terminated its MLM compensation plan.
There’s a consensus that MLM companies pretty much all have the same set of policies and procedures. Don’t be fooled. This is not boilerplate stuff. Not all MLM companies have this easy exit clause in their contracts.
A company that has a long term vision will NEVER put something like this into their legally binding documents with their distributors.
If a company says this in their legally binding agreements, it means they are already know they’re not going to around for the long term and this will give them an easy way out. iLearningGlobal said they could pull the plug at any time, so it should come as no surprise that they did it.
How do you protect yourself against unexpected termination of your MLM business?
Well, there are a lot of attraction marketing experts on the internet talking about the “You Inc.” business model. “You Inc.” is essentially a three step process of…
- Branding yourself and positioning yourself as a expert to build a list of subscribers.
- You build a relationship with your list by giving them good, helpful content they could use to improve their own businesses.
- Marketing to your list any offers you may have, from affiliate training products to your opportunity itself.
The idea of the “You Inc.” is insure yourself against company closures and termination of your contract with your MLM company. If a company decides to go out of business, you still have a list of people who you can offer a new MLM deal to, or an income source from the sale of affiliate products.
But my question is, “How is this working for most ‘self branded attraction marketers’ out there?”
Yes, building a list of good prospects for your business opportunity and establishing a relationship with the people on this list is very, very important. But why not choose a company that will be here for you in the long term?
Why take the risk of having to build it and rebuild it with companies that do not have a long term vision? Why would risk your long term future and put in all that hard work and dedication for a company that says it can change its business model whenever it wants to?
This is why it’s so important to read your company’s policies and procedures. You can gain a great understanding of a company’s integrity from these legally binding documents.
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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Very valid points made here. List building is huge.
Yes, but what’s more important is the relationship you have with the people on the list. If you don’t have one, it means nothing.
I couldn’t agree more to what the article says. A long-term relationship is great because it will build trust and the business will be more fulfilling, more than just profiting from every client they have.
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