The future of Network Marketing is in our hands … the hands of company owners, executives and independent sales leaders. We can band together with shared vision and values and execute a quantum leap in our success, or we can continue to operate with opposing visions and values and battle each other along the way. The future is our choice; it is in our hands, every one of us.
I have been a full-time Network Marketing leader since the concept saved my life in 1977. I used to cut chickens for Foster Farms. I intended on spending the rest of my working life there and would be retiring any year now. It is hard to imagine how my life, and the lives of many others, would have been different had I not been drawn into our magnificent industry.
And as much as I love it and appreciate its gifts, it has been a love-hate relationship. I have bled from both sides. I have been terminated without cause after building a group of 30,000 people. I have had sales leaders in my company—those we honored with magazine covers and on center stage—attempt to knock off our products, sue us, raid our sale force and still expect to be paid their “residual income.” We have spent millions on attorney fees to protect what we have built. Even with these challenges, I have seen Network Marketing work beautifully with loyal leaders who fought all the battles with us.
The history of our industry has been wild, fun, profitable and heartbreaking. We have grown 19 out of the last 20 years. And we could have done so much more. We could have avoided so much bad press; so many regulatory actions and so many dreams destroyed. We could have shifted the paradigm by now … the “tipping point” if you will. We could have been one of the dominant laws of wealth-building for individuals—equal to investing in equities, real estate and traditional small business ownership. We still can. And to do so, we need to shift our vision. We need to assess our values. We need to move from a belief of scarcity to a belief of infinite abundance. We need to tap our core values of contribution, respect, love, friendship, honor and integrity … and avoid our attachments to greed, recognition, dominance and control.
The franchising model in the U.S. is a valuable comparison. They started about the same time we did—50 to 60 years ago—with Kentucky Fried Chicken, Burger King and Dunkin’ Donuts. Unregulated and operating from a dysfunctional set of values, the franchising concept created its own share of train wrecks through the 70s. Federal regulation was the result … not something any of them, or any of us, would prefer. As a result of aligning their efforts over the years, today the franchising concept contributes close to one trillion dollars in revenues.
After the same amount of time, we only produce $30 billion. Franchises generate 33 times more business than Network Marketing. That’s 33 times more billion-dollar companies; 33 times more hundred-million-dollar companies; and 33 times more millionaire and multimillionaire entrepreneurs. The way I see it, although franchising is an incredible business model it does not hold a candle to ours. At the very minimum, franchisors must risk tens of thousands of dollars, up to millions, and they must dive into their new business full time, risking everything they own. It is like buying a job with no guarantee of success.
We, on the other hand, have an opportunity that anyone can pursue for a few hundred dollars and a few hours a week. Nothing is risked and everything is to be gained. Our model not only offers personal, spiritual and character development, it demands it. Our model utilizes leverage, where one person’s efforts can result in building wealth based on dozens, or hundreds, or even thousands of other people’s efforts. Our model offers (or should offer) residual income such that four to five years of success can provide income, security, freedom and wealth for many generations. From value and ease of access, the Network Marketing model should attract tens of millions of participants. No doubt the franchising model, with its financial and time commitments, will always produce far less attrition, but we can compete with far more participants.
Network Marketing, or Multi-Level Marketing, is NOT what some people like to call “just a compensation plan”. We ARE a unique community within the Direct Selling Industry. We are a community and culture of building empires of multiple levels of sales representatives, on which we expect to be paid forever. We are not looking for another sales job. We have had those.
We are looking to build our wealth through residual income … commissions based on product sales from the network of distributors we build … distributors who likely would have never joined our company had we not joined first and succeeded in leading them to follow. We expect that as long as we honor what we build—as long as we protect it, promote it, lead it and nurture it—we should be paid on it virtually forever. It should be the wall of protection around our family … forever. It should be our legacy. Without this promise in our culture, we are just expendable employees … roadkill on the highway to corporate quarterly profits.
The shared vision of Network Marketers could be this:
To bring a new paradigm of abundance and wealth building into existence so that most people …
- Understand how and why Network Marketing could work for them;
- Admire and respect those who succeed, just as they admire those who succeed in equities, real estate and small business;
- Trust the business model based on our ethics, our candor, our commitment to build trust and respect;
- And have one primary Network Marketing business, in which they are building residual income.
Imagine … almost everyone you know is building wealth through the residual income of their chosen Network Marketing company, just like they are investing in equities and real estate. Now there are three ways to build wealth, and everyone knows it.
There are at least 100 million candidates in the U.S. alone for what we offer. Most of them invest in equities and a large percentage in real estate, if only their primary residence. Attracting 50 million of them to participate is achievable. There is synergy in going from 10 million to 50 million. Our measly 30 billion would not just grow 5 times, but more likely 10 to 20 times. A trillion is within our reach.
This new paradigm will never exist without a shared vision and shared values. If we truly embody the core values of contribution, partnership, success and integrity we can get there. But not if we continue to do what industry legend Mark Yarnell is famous for saying: “We are the only industry in the world that when things get tough, we circle the wagons and start shooting at each other.”
This synergy will never happen as long as we tolerate greed, unlawful strategies, irresponsible product development and unethical business promotion. It will never happen as long as company founders continue to design compensation strategies that violate the law; violate the DSA Code of Ethics; and as long as those same company founders continue to hide their lawlessness in the complexities of their plans, hoping to run under the radar or at least get big enough fast enough to be able to afford the fines and move on. It will never happen as long as company owners and their executives see the source of their sales—the independent sales leaders—as employees or dispensable assets. And it will never happen as long as sales leaders act as hit-and-run drivers, with no loyalty or gratitude for the tremendous risk, investment and work ethic required to successfully launch and lead a company.
Here is a possible dialogue for both parties. Here is what companies could commit to in order to earn the trust, loyalty and evangelism of their sales leaders, as well as the admiration and respect of the media and regulators.
- A commitment to the longevity of their Network Marketing compensation model. A 100-plus year Network Marketing business plan.
- A commitment to honor, champion and protect the sales leaders who build with you. Success is a partnership, with both parties committing 100 percent.
- A commitment to develop the very best products possible, and to market them legally and responsibly.
- A commitment to design and market the opportunity in a way that fosters trust, respect and an environment free of regulatory actions and negative media.
- A commitment to respect and champion every other company’s right to compete, and every leader’s right to choose and build their empire without undue litigation intimidation and harassment.
- A commitment to a clear, concise set of policies and procedures that spells out each party’s rights and responsibilities, and is balanced in its favor. (We cannot expect sales leaders to invest years building something that the company can terminate at any time … “at their sole discretion.”)
And here is what sale leaders must commit to, in order to earn the loyalty and trust of their respective companies.
- Do your homework. Find a company that honors your own vision and values, one that is responsible and commited to longevity.
- Marry your company, for the long haul.
- Follow your company’s policies and procedures. Do not put your company at risk with unethical marketing or business practices. Check your facts. Just because someone else said it, doesn’t make it true.
- Follow the spirit and intent of your compensation plan. Compensation plans are designed to incentivize specific behaviors and a specific culture. Undermining the plan undermines the culture.
- If a divorce is absolutely necessary, do it with honor, integrity and generosity. When it is clear you made a mistake, get out quick and get out clean. Don’t expect to be paid to compete with your former company. There is no leadership or integrity in such an expectation. Also, don’t promote your new company at the public relations expense of your previous company. Remember, at one time you said that they were the best there was.
- Be a “Do the Right Thing” leader. You know what the right thing is. Do that
I propose that companies adopt a set of strong Cultural Commitments … a Code that lays out their vision, their values and their commitments to be part of the solution and part of our industry’s future prosperity. A code to which leaders can hold their company accountable; one to which a company can hold their sales leaders accountable. A public Code from which we cannot hide.
Ours is an instantly perishable business model that, by its very nature, requires we prove longevity. We cannot afford to kill each other off. Every failed Network Marketing business that was honorable hurts us all. They fuel too many stories of failure, negative media and more evidence for the regulators.
We need to lock arms in mutual respect, choose our partners and build an industry, a business paradigm and a way of life that can never be voted out of existence. We can only do that with ethical, legal and moral success.
“United We Stand.”