What Is Network Marketing?
Most people do not have the
slightest idea what network marketing is, and they have all sorts of perceptions
and prejudice about it. However, this article will seek to clarify what network
marketing really is.
First and foremost, you need to
understand how the chain of manufacturing, supply and demand goes. When the
manufacturer makes a commodity, the transporters are used to distribute the
goods. The transporters may be the manufacturer’s or may be the distributors. When
these goods get to the distributor, they are stored, and wholesalers come for
them so that they cam sell the goods to the retailers, who in turn sell the
goods to the consumer. Apart from these, other middlemen are involved. The
company that makes the commodity has to advertise for it, and that is why your
programs are filled with commercial breaks. Also, companies use sales men to promote
the commodity to wholesalers and retailers.
Needless to say, all these middlemen
have to get their portion of the profits because none of them does free work.
The company that manufactures has to pay for space, for its workers and its
salesmen. It also has to maintain the industry and after all expenses are met (including
the tea at 10am), the manufacturer wants to bank a huge profit to enable
expansion of the industry.
The TV and radio stations have to be
paid for every second the advertisement is being aired, and the distributors
have to make profit out of the same commodity after they have paid for space
and the risks of storage, among other over heads. The chain goes on and on,
through the wholesaler and the retailer (including the vendor or hawker) until
it gets to you, the consumer.
Therefore, you find that an item
whose value at the manufacturer’s place is four dollars gets to you when it is
thirty or forty dollars! This means that it is you who pays every middle man
involved before the commodity gets to you.
However, network marketing cuts
short this chain and it directly links the manufacturer to the consumer. Therefore,
you get part of the money that the middlemen would have gotten and your up
lines get a portion. This goes up all the way to the manufacturer. No wonder
you also get a portion of what your down lines sell. Network marketing
generally entails making a network in which promotion of a good or service is
done and other people are also recruited into the network to make it wider.
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