In part one of this article two article series, we discussed why you and many others fail in network marketing as a home business. We discovered that a company’s high overhead cost, which is funded by the compensation plan, makes it very difficult for you to be successful. So, your failing is NOT your fault since the cards were stacked against you to begin with! Now, we’re going to talk about how this sort of business model will impact your ability to grow your business.

Here’s an example. Let’s pretend that there are three different companies that have the same vitamin complex with identical ingredients. The only exception is that the third company, company C, has added a special enzyme to digest the vitamin’s nutrients more effectively.

You would think that the cost to produce this vitamin complex would be similar or identical and you would be right. However, believe it or not, the three companies charge different prices. This is because Company A sells the product for $118, Company B for $108, and Company C for $40 (which has the special enzyme for better absorption). Now, who in this world will buy this vitamin product for $118 when they can get the same thing, including the special ingredient, for $40?

Are you getting the picture here? What happens is that network marketing companies that that sell the pricier products have to always recruit more distributors because that is where the money is. The companies have to do this because they can’t get any money from retailing their product because it’s way too expensive and no one in their right mind will purchase the product. Why? Because they can get it from Company C for $40! So, the company that has costly products is forced to recruit, recruit, and recruit!

Things, unfortunately, get worse. If a company has to spend so much time recruiting because they have an overpriced product, are they going to have time to mentor you in your business? Hardly! So, you are left struggling to do things on your own.

Now, there is a reason the Company C can sell the same product for much less (remember the $40?) It is because they have built their company in a way to significantly lower overhead costs. They don’t have a multi-million dollar office. They take almost 100% of their orders over the Internet so they hardly have any employees. Company C uses a low cost warehouse district facility to store stock. Would you agree this is a more distributor friendly model?

If you thought, “yes”, you were right! If you happened to be a distributor for a network marketing company with high priced products, you’d have to be a pushy and aggressive sales person. Since almost 100% of the population dislikes pushy and aggressive sales people, it would be hard to be successful right? Right!

Now, are you seeing how being a distributor with a company like Company C that is streamlined would make a huge difference in your success and being able to build your business? Company C has the resources to hugely support is distributors and gives them an outstanding compensation plan? Why? Because it is streamlined and has an excellent product that is reasonably pr iced that people can afford.

It is unfortunate that some companies do not operate like Company C. So, to avoid being a distributor in a company where the cards are stacked against you, make sure you do your research. Google the company founder. Carefully look over the company’s compensation plan. Compare the prices of the same or similar products of network marketing companies.

If you do this, you will find yourself avoiding those companies where you are doomed to fail, and end up with a winner where you can finally build a successful network marketing home business.