Running a successful MLM Network Marketing business can be challenging. In business, it is almost never a good idea to lend another person money and this is especially true in MLM, where this loan could actually stunt the growth of your downline and your business. Sometimes you just have to say no if you want to avoid potential problems down the road. The reality is that most people do not appreciate things when things are given to them. If you are on the fence about paying someone’s way to come into your business is NOT worth the investment. So, in most cases I would suggest pushing the rep to figure out a way to fund their investment is a better idea. In the end, your rep is ultimately responsible for his or her own distributorship. Here are some of the reasons why you should never pay for another person’s distributorship in an MLM business:
1. You can’t do it for everyone
If you have ever run an MLM Network Marketing business then you have probably had a prospect say something like “I just don’t have the money to get started…” This might be true, but this is not really your problem. If you loan someone the money for his or her distributorship then you will be setting a dangerous precedent. After all, if you do it for one person, you have to do it for everyone, right? Loaning money to your downline is not a recipe for success in the MLM world. In addition, if you loan money to one potential distributor then it will appear that you are playing favorites, which is not a good way to motivate your team. It is best to avoid these complications and the appearance of playing favorites by simply saying no to everyone. If you make it part of your policy then no one can blame you for saying no.
2. It doesn’t help them succeed
The biggest part of running a successful MLM Network Marketing business is being independent and self-motivated. If a rep in your downline knows that you are going to cover for them then more than likely they will not value the distributorship. It is similar to a kid that keeps borrowing money from his or her parents. Eventually, the parent has to say no if they ever want their child to be responsible and independent. The same is true of your downline, as you want them to have the self-sufficiency and responsibility to handle their own financial problems.
3. It blocks creative resources
You want a downline that is creative and resourceful since these traits are necessary for success in the MLM Network Marketing world. By giving them money for their distributorship you are actually hindering the development of these traits. You want to know that your team has the resourcefulness and creativity to solve their own problems. By doing this, you are unveiling leaders in your organization. If they do not, they will not likely be of much value to your downline, especially if you have to constantly bail them out of trouble. If you want your team to develop creative resources then you have to take a step back.
Loaning money to friends or business associates is almost always a recipe for disaster. Not only that, but you could actually be doing more harm than good, which will stunt the growth of your network. It’s your turn! Have you ever seen a rep pay for another rep’s distributorship? If so, what was the outcome? I look forward to reading your comments!
I have never done it Nate and will never do it. Sets a terrible precedent, based on your dead on reasons dude. If people cannot acquire a few hundred bucks they have serious money problems, and hey, an adult should not go around asking for an allowance, right? lol!!! Gimme, gimme, pay for me hahahaha….
Good stuff man!
LOL! Love the feedback my man!
I agree 100% Nate. The passion, desire and a will to win cannot be purchased for someone. I would never operate in this manner. Success has to be earned not purchased.
Awesome post Nate..I shared it on a couple on social platforms
All good points, and I’d not considered your point on creativity – if they ‘really’ want in business, they’ll find the money. Heck, my company is only $21 with no Sign-up fee, but I had a prospect last week tell me they’d have to wait until middle of this month for payday. True, I don’t know.
But I bet there’s something in their house worth that they could sell on ebay, for example…
Yes, creativity goes a long way. There’s a crossroad where people may say they do not have the “money” to get started. That could be a high ticket item or as low as $21 like you said. If they see an opportunity and depending on how bad they want it, they have to be creative. Sell something that they may not use, figure out a way to find the money.
Yes, I never understood why people need to wait for payday. If it’s the beginning of the month, you’re going to wait two weeks? So those two weeks, you could be on your way to building something yet you hinder yourself from that? Makes no sense to me.
It almost sounds like a new years resolution where they realize they want to lose weight for Jan 1st. Currently it’s 15 days before the first of the year, but yet they wait till Jan 1st.
You’re right about the ebay part. Thanks for the feedback, much appreciated Jon!
Yes Nate. I’ve seen it happen and I’ve done it myself. I’ve paid someone’s way into the business. The outcome?….they didn’t do anything. My money went to waste.
It’s important for people to pay their way into the business because it will motivate them more to work on the business, since they are vested in the business. If you pay for them to get in, they may not be motivated to do anything because they don’t have any “skin in the game”.
The only time I would say you should pay for someone to get into your business is if you’re trying to hit a certain rank or win a certain prize from your company and all you need is just one more person to get you to the next level. However, make sure that the benefit you will be getting, outweighs the cost of paying for the person to get in.
Thanks for sharing buddy!
I’ve seen this happen time and time again and your story is exactly right. Thank you for the feedback, it support my message on this blog post.
If you have to pay someone in, then that shows how un-resourceful they are. I’ve spent $5000 to join something when I barely had a $1000 to spend.
By being resourceful and coming up with the money.
If they want in, they will find a way.
Good post as always man.
Another great article Nate. That common excuse of “I don’t have the money is just that–an excuse.
When someone tells me they don’t have the money, my response is as follows: “If you can’t put your hands on $365, that’s a big problem and you need to have a plan to change that immediately.”
People are out there searching for a Plan B and a way out of their financial and time crunch, yet they aren’t willing to participate in their own rescue. Investing in your business is huge. Setting time aside to attend meetings, trainings, and local/regional/national events is paramount to success. In my particular business, representatives who attend trainings earn five times their counterparts who attend nothing. These are professionals who understand that you have to continue to invest in yourself long after you invest in the business.
On a final note, those business opportunities out there that are promoting “free to join” are a waste of time! If someone is advertising a business that promotes a quick and easy path to success, keep on walking. No one and I mean no one has ever achieved great success in network marketing without putting in the time, money, and effort.
You can’t push a dead bear up a tree, and you can’t buy someone into prosperity.
To your success!
It is an excuse, and they more than likely been making excuses their whole life. I think when people say they want to make money or have a plan B, I think generally people want that, but how many of them are willing to take the next step to get there. Not many, but it’s the stone cold truth.
How do they expect to get ahead in life if they are not willing to help themselves. They must understand that if they make the change, their whole world changes.
I agree with you on the “free to join” program. There is always a catch. Network Marketing is a real business, but most dismiss it because how the busines model looks on paper, never mind understanding the dynamics and what goes along with it. It’s really sure ignorance on their part…. some are igorant on purchase and some are ignorant and have no clue.
As always, love your comments and have a great week ahead!
Hi Nate, I agree. People who don’t have the money, usually do if they want it bad enough. I struggle with smokers who say they don’t have money for important things, but have the money for cigarettes.
If you want to make money you have to spend money. Your own money.
It’s always nice to see a new face. 🙂
Smokers who have money to spend on a pack a day or a case every two weeks, certainly have “money”. That also goes for Coffee drinkers that have to have Starbucks in the morning and afternoon. So, I agree with you there. 🙂
Again, thank you for stopping by and I will see you again here soon!
I’m going to have to agree with you on this one. One should never pay for another person’s distributorship and you have mentioned several of those reasons in your post.
I was talking to one of my upline members and he mentioned that people do not treasure something unless they pay for it, even if it were to cost them a dollar.
They begin to treasure the item they paid for because they have chosen to take ownership of it. Whereas, when something is free, people tend to push it aside, thinking that it is of no value to them (even if the content gives them all the answers they need).
Likewise, if you are paying for someone’s MLM distributorship, you are not allowing them to take ownership of their OWN business. They devalue their position, and in most instances, wouldn’t even be bothered to build the business at all.
Let them figure out a way to find the money that can help them pay for that sign-up fee because the harder it is for them to get that money, the more they will treasure the opportunity.
Paying for someone’s distributorship is as good as setting someone up for failure.
Great post Nate!