If you have been wondering about Network Marketing (MLM) but couldn't quite figure out how it all works, here is an explaination that may be a bit easier to understand as you can easily do the math with a calculator.

No matter how much you get paid per hour, you will always be limited as to how many hours you can work. Why? Because there simply aren't but so many hours avaliable!

Let's break that down into simple math. If you work 24 hours a day 7 days a week for 1 year you will only be able to work 8,760 hours in a year. There is no more!

Now, if you have people working with you, you can multiply those hours. For example, you have 5 other people working with you in your business, only they aren't working 24 hours a day. Let's say they average 4 hours a day each. Using the same 1 year scale, these 5 people are able to work a total of 7,300 hours in a year. When you add your 4 hours a day to theirs, you have a total of 8,760 hours a year! Notice that the hours equal exactly the same hours as you working 24/7 alone! This is just 5 people. Let's take that 1 step further:

Let's say that these 5 people each had just 5 people that they had working with them. Using the same hours at 4 per day, you now have 30 people (your first 5 plus their 5 each or 5 + 25). In 1 year, these 30 people would now be able to work a total of 43,800 hours! Now add your 4 hours a day to that and you have a team that has now worked a total of 45,260 hours in 1 year!! And that is just the beginning of how the multiplication of hours can work for your business.

The best part is that in this business, all of those people that are working with you in your business are also building their own business in the process. Does it happen overnight? Of course not! No business is ever built overnight. It takes time. That is why it is so important that you have a good retail profit margin from the company you join. The retail profits are where you receive your immediate income. The residual comes from building your business through sponsoring new members.

Many people look solely at the percentage on the compensation plan and overlook the retail profits. Then, when they get started in their business and find they aren't making any money right away, they give up, feeling that they have been wronged and that network marketing must be a scam because they worked so hard and didn't make any money.

So be sure to review and understand their compensation plan but also check out the retail profit margin as well. With a good company, you can succeed in network marketing and become financially independent.

© 2007 Bonnie N. Ramsey

Bonnie Ramsey

Diamond Team Leader