Passive Income Ideas: Network Marketing

In 1860, Henry Heinz created an organization of 400 salesmen to sell various products on which he also earned a passive income commission. 

This was the first version of the Network Marketing model, although there is no evidence that Heinz allowed the people in his organization the opportunity to recruit their own sales teams. Because his salespeople were not allowed to build their own teams and generate passive income, by today’s definitions, Heinz was not a Network Marketing company. 

In 1868, J.R. Watkins started the J.R. Watkins Medical Company in which associates marketed directly to consumers. However, in this example, their associates did have the ability to earn an income by recruiting others to join the sales force, and getting residual overrides from their individual sales teams. 

To record, JR Watkins Medical Company is the first official Network Marketing, MLM company in history. 

Then came the California Perfume Company, which was founded in 1890. By 1906, the company had over 10,000 representatives selling a product line of over 100 products. In 1937, the California Perfume Company changed its name to Avon Products and the rest is history. 

There were a few other companies that started before the emergence of the California Vitamin Company, which ultimately changed its name to Nutrilite and was acquired by Amway. And it was the success of Amway that opened the eyes of larger brands to the concept of network marketing.

Since then, 100’s of Network Marketing companies have been started.

To help you give a clearer understanding of the power of Network Marketing, picture this little scenario: 

Average Jane decides to go into business but she has zero to little business experience, and only a shoe-string budget to invest into the start of her business… but she has a great work ethic and she has a strong desire for success. So, she does her due diligence and decides to join the network marketing company… PHP Agency. 

PHP Agency has taken care to set a strong foundation for its distributors. They:

• Operate within a strong, “evergreen” industry.
• Have access to products and services that are Top-Tier within their industry.
• Operate a comprehensive system that handles most business logistics.
• Run an easy to duplicate system for marketing and building.
• And have a great administrative and support team at their headquarters. 

And to top it all off, Jane gets lucky and gets recruited by a mentor who is supportive and actively building a strong business, themselves. 

The only thing Jane has to do is stay focused on her growth, and to consistently and effectively market herself and her business. 

Within a relatively short period of time – 3-6 months – Jane builds a nice supplementary income for herself.

After a couple of years, Jane builds a business that generates multiple six figures of passive income every year. 

And several years after that, she ends up building an organization that consists of thousands of distributors, who move tens – even hundreds of millions of dollars in product – which pays Jane millions of dollars in passive and residual income, every single year. 

The only time that PHP Agency pays Jane is if a sale has been made somewhere in her organization. PHP doesn’t have to pay for adveritising because Jane’s organization – and other organizations within PHP – do the marketing for PHP through word of mouth.

The more her distributors succeed, the more Jane succeeds. And the more Jane succeeds, the more the PHP Agency succeeds. 

Everybody wins.

Stories like this quickly reached the biggest business developers and venture capitalists in the world.

Word got out that the Network Marketing/MLM model could bring millions, even billions of passive and residual income to a company. And it got to the point that venture capitalists started network marketing companies just because they knew the system worked. They didn’t care about what they were selling, as long as it was through the Network Marketing model. 

Thus began the multi-level era. 

There was/is a network marketing company for virtually every industry or product that you can think of. 

• Health products
• Telecommunications 
• Insurance and Financial Services 
• Knives, Pots, Pans & General Kitchen Appliances
• Digital Products
• Cosmetics
• Books
• Legal Services
• Medical Services
• Shampoos, Lotions & Toiletries
• And many more.

Naturally, this extreme success attracted some short term thinkers and bad apples to the industry. Soon enough, the average consumer became savvy to the network marketing model and eventually developed a new level of defense against “spammy” network marketers and their sales tactics. And because the consumer market caught on, the network marketing companies that were based on shaky principles went out of business. 

The good ones, however, made it through and are still around today. 

Which brings us to the question, “How do you know if a network marketing company is legit & will be around decades from now?”

There are several key elements that will ultimately determine the success of a Network Marketing company. Many of them are basic business fundamentals that have been around since the inception of commerce. And even though the Network Marketing model is a leveraged business model that offers a lot of resources to the individual builders, it is still a business, therefore, “traditional” business philosophies still apply. 

When analyzing the legitimacy of a network marketing opportunity, and whether or not they’re a long term player, here are some key elements to look out for. 

• A Product or Service that will sell without the need of the network marketing model. 
• The product should be good enough, competitive enough, and desirable enough by the consumer market that the individual distributor could actually sell it without having to recruit someone and sell it to that recruit. 
• An individual distributor should be able to generate a 6-figure income just through selling the product. 
• A Leadership Team That Has a Larger-Than-Life Vision For the Future.
• If the founders of the company aren’t focused on breaking their previous records & competing in the marketplace, then they will not invest into the infrastructure of the company enough to allow it to grow. Thus, your potential for growth will be limited. 
• An Easy to Duplicate Marketing & Distribution System
• The best systems are simple enough that the least capable distributor in the organization can operate it as easily as the rest.
• The most duplicable systems are tool based and have little to no reliance on the personality of the individual distributor. However, the stronger the distributor is, the better the system will work for them. 
• An immediate up-line/mentor that is actively building and successfully growing their own organization. 
• Although it’s true that your success in this business model, just like any other model, relies on your personal performance and dedication, it’s important to have a close mentor that is setting the proper examples for you. 
• Certain mistakes can’t be avoided and certain experiences must be had in order for you to learn and grow. However, there are plenty of mistakes that can be avoided simply by listening to the past experiences of your up-line mentors. 

The reality is, there is no business model that has the earning potential, the “ease” of growth, and the support system that Network Marketing does. 

You can quite literally start with the smallest of budgets, and through sheer will and hard work, you can build yourself a 6-figure, a 7-figure, and even an 8-figure business. 

There is one very simple but very real catch, though… 

Even with all the tools, resources and strategies that are available to market and build your business, you still have to put in the hours and the sweat equity to build your business. 

You will NOT succeed with no effort. Your up-line will NOT build your business for you, and if they do, they will expect much more than their 10%-20% override. And you will NOT be an overnight millionaire. 

Don’t buy the hype that is being sold by 99% of recruiters. 

If the opportunity sounds too good to be true, that’s probably because it is. And if they tell you that “all you have to do is plug in to our system…”, then run the opposite direction as fast as you can. 

Network Marketing is a business. It requires your respect and dedication. And IF you’re willing to commit to your business, then it will pay you back more than you could have ever imagined. 

You can have the greatest passive income business of your life, but you have to be willing to build it first. 

The firm with whom I’m partnered – PHP Agency – has done very well in creating a platform that people from all walks can use to build a passive income network marketing business of their own. 

If you’re student, stay at home mom, corporate professional, or business owner…  and are interested in adding an extra revenue stream to your current income portfolio, send me an email or a DM on Instagram.

My email address is: arman@nahesh.com

My IG Handle is: @officiallyarman