Newbusinesses, for the most part, are susceptible to failure, particularlyin their first five years of business.  According to the U.S. SmallBusiness Administration, over 50% of small businesses fail in the firstyear and 95% will close within the first five years (although notalways because of failure) http://www.sba.gov/advo/stats/bh_sbe03.pdf. Although it is difficult to come up with hard numbers, you can be surethat the same is true of multi-level marketing companies.

So how do you balance the risk with the opportunities available?  Ifyou get a chance to get in on the ground level of a new MLM company,should you do it?  How do you know if a company is having trouble (inother words, when to go)? 

You can use a couple of strategies when it comesto your participation in the MLM business.  First, you can look atjoining MLM companies much like a stock portfolio by diversifying.  Ifyou want to join that new company (with the corresponding high risk),be sure you have a steady stream of income from a more stable source.

You can join the new company, but be conservativeabout how involved you get.  Be careful about how much you areinvesting, particularly if you are buying multiple positions.  Don’tstockpile a lot of sales materials or products.

What are some of the warning signs of a MLM thatmay be having difficulty?  Probably the number one sign is when thecompany announces changes in the compensation plans that don’t benefitthe distributor.  Have they changed how they pay out or how often?  Doyou now have to do more to get the same compensation? 

Another sign is if the top distributors go, eithervoluntarily or by being dropped.  Yes, even though you are anindependent business owner, a multi-level marketing company canterminate you.  Usually this only happens to top distributors for tworeasons.  One is that they really did something bad or they are nowmaking too much and the company can no longer afford them.  If theremultiple big names going, you should be looking into what’s going on.

Multi-level companies that start adding productsthat are a mismatch with what they have previously carried is also asign that something might be going on.  If your local tire companysuddenly starting selling vitamins, you would probably wonder what wasgoing on.  The same is true in multi-level marketing companies. Sometimes the company may stay afloat, but ultimately split (sinceselling tires and selling vitamins are two different things). 

If you are new to multi-level marketing, or justdon’t like taking risks, then stick with a company that has beenaround.  They probably know what they’re doing and you will have a goodchance at being successful without wondering if they will be aroundtomorrow.

Send me an email and I can help show you a stable company and program.

Dr Robin Rushlo   drblindguy@gmail.com

“If you can't fly, run. If you can't run, walk. If you can't walk,crawl. But by all means, keep moving.” Martin Luther King, Jr.