Jan
MLM software is expensive. That’s why most MLM companies rent their software. In most cases it cannot be adapted fully to fit their business model, and the distributor base suffers as a result.
Let me tell you a story about a network marketing company. They had a binary compensation plan, which is a plan where you build two legs – a left one and a right one. Unfortunately the software they rented did not permit changing from left to right and vice versa and they had to have programmers in to do it and of course that cost time as well as money. It took them about half a year to get it sorted out.
In the mean time there were people who had already built one strong leg. In a binary plan you then need to re-adjust in your back office and get the new sign-ups on your weak leg so that you get paid. You get paid on your weak leg! And in that case people thought that the new sign ups were going in your weak leg.
What happened with that company was that this change over just didn’t work and after a while distributors found out and approached the company to move the new people. The company hired lots of people to handle the changes yet couldn’t cope. They even started to charge the distributors per change-over although it was the company’s mess and in the end they stopped doing it altogether.
This is a perfect example of buying software which doesn’t fit the purpose at all.
On the other hand when you rent the software, you better read the fine print, as you don’t own the database! You have heard right:
You Do Not Own The Database!
Michael Dlouhy told us that he saw a downline genealogy for sale on the internet and he happen to know the owners of the company. So he called them and asked them what was going on – if the company wasn’t doing well. He heard that the company was doing great yet had had to rent the software and the software company owned the data base.
This software company made a nice lump sum of money by selling the data base to a bunch of companies. It had been in the Policies and Procedures, that the software company owned the genealogy!
How would you like to build your business and then have your organization for sale on the internet?
It has to be one of the critical questions when you check out a company, if they own their software. Renting is a lot cheaper and most companies don’t have the 2 million dollars to buy it when they start.
It certainly is the best choice to opt for a company who had their software custom built! When the company had it built and owns it, the distributor base is safe. Instead, for starting a network marketing company quickly, the owners rent the software and are in business in no time. If it is your business – what do you do?
They know that network marketing is a tough business. They know that most companies don’t survive the first 2 years. So renting software minimizes the risk. But how about you? This is a dangerous secret!
What about another well kept secret: The software company will be a partner of the MLM company – it means that the MLM company builds an organization, a leg, for the software company. It creates a retirement income for the software company on the backs of the distributors. Is it a problem for the owners of the MLM company to move all their orphan distributors underneath the software company so they receive a nice check? What a secret!
It is one more reason why you need to base your future on a company with an owned custom made software!
Do you start realising why education in this industry is critically important – especially when you are capable of building a downline well. Background knowledge saves you from having to cry over spilled milk at a later stage!
To Your Success!
Frieke Karlovits
A mentor With A Servant’s Heart
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