The year 2020 has been disastrous for businesses around the world, but not quite so for the direct selling industry. Home confinements and social distancing drove the demand for direct selling of products and essential goods. Network marketing flourished in a year that caused a global economic slowdown. And, this has encouraged millions of entrepreneurs in starting their own network marketing business in 2021.
While the COVID-19 pandemic may end soon, consumers are expected to continue purchasing their goods from direct sellers. After experiencing the profits made during the pandemic, the demand for direct selling businesses is at an all-time high. According to Forbes, the direct-to-consumer business model holds the key to success in the coming decade. With the high penetration of e-commerce platforms and the upsurge in digital consumerism, 2021 is perhaps the best time for you to start your own network marketing company. Here’s how:
How to Start a Network Marketing Company
Starting a network marketing company is not difficult. However, some may find it hard to understand and implement the different multi-level marketing (MLM) techniques used by these companies. As an entrepreneur, a new MLM company is your viable opportunity to become a successful businessman. It not only provides the means of livelihood for all the members working your MLM network, but also helps you master the selling of products in the most competitive marketplaces.
To start your own network marketing company, you need to get experience in an MLM organization or consult MLM experts. This helps you understand how your company would evolve from the ground up. If you’d consider doing it yourself, here are some professional tips on how to establish a network marking business.
Specialize in a Product Category
A sure-shot way of running a successful network marketing business is product specialization. Most MLM companies focus on a single product category before diversifying into other categories. You can select your product line based on the motto of your network marketing company and the profitability of the products. The global health crisis can be considered opportune to open a network marketing company that sells healthcare products. Based on the niche of your business, you can devise network marketing plans around it.
Tie Up with Wholesale Suppliers
After finalizing the product category and the product lists, find a wholesale supplier that can partner with you. Make sure that the supplier is associated with the National Association of Wholesaler-Distributors. You can also become more familiar with wholesalers by attending a couple of their meetings. There are multiple wholesale suppliers and product manufacturers that can become potential partners to your business. But, make the selection based on their dropshipping services, inventory level, product catalogs, and brochures. It is important to develop network marketing plans by including the perspective of your suppliers and how they can manage your orders. Before selecting the supplier, try to arrange the supply of the products at the lowest cost per unit.
Build a Price Structure
Next up, you need to set the retail price of your products. Here, you need to consider the recommendations of your supplier. While creating network marketing plans, you can use an effective MLM software to create a commission structure. With the help of network marketing tools, you need to determine the pricing of products that pays every distributor at different levels of the network. Ideally, you can set the distributor commissions of 10% of the product price. First-level distributors should be able to earn significant money from the sales made by their recruits. Hence, set the commissions for second-level distributors at 5 percent each and so on.
Set Up Your Organization’s Management
Network marketing tools provided by MLM software can improve your business management. Your newly-formed company needs to be organized in a way that the commission-payment structure is properly implemented. Use Ventaforce, a cost-effective commission-payment software to calculate and process the earnings of your fellow distributors. Additional features of the software can also help you create instruction manuals, add product catalogs, manage websites, and place bulk orders.
Leverage Modern-day Digital Marketing
Advertising the final step to the launch of your network marketing company. Start promoting your company, the products you sell, and the lucrative prices on digital magazines, social media platforms, and mainstream publications. From email marketing to social media promotions, maximize all digital marketing solutions to create a hype around your business. Try to get public figures and local celebrities engaged with your company to drive your brand awareness.
In 2021, the success of your networking marketing company will be tested for its organizational structure and technological advancement. Make sure to use the best MLM software while running your new network marketing business in 2021 and beyond.