Traditional Business vs Network Marketing

traditionalbusinessvsnetworkmarketingTake a look at the differences between running a traditional business and a network marketing business.

The advantages of building your own network marketing business can be really rewarding financially and also offer you time freedom.

Network marketing can be the ideal solution that you are looking for in this global economic crisis.

The Small Business Model

A traditional retail business can cost you anything from $50,000 upwards. You will have to put in more hours than a 9 to 5 job for being your own boss. You will also have to come up with the money to pay your rent every month.

You will be responsible for your employees, stock and fulfilling orders… running your own business can be a nightmare. Once a small number of people make it past 12 to 24 months.

Profits are a rare commodity within the first 12 to 24 months. You will have to make a profit equal to your initial investment amount, just to break even.

A large number of people that start up their own small business, invest all their life savings into it. After 2 – 5 years of running the business, they put in more money to keep it ticking along. A small number of entrepreneurs manage to build a profitable business.

Others make enough just to survive, these people have traded their 35 – 40 hour weekly job for 60 – 70 hours of work. They are in fact working around the clock, matters related to their business are always in their mind. They have also invested their life savings for this privilege.

The vast majority that start up a small business usually end up broke or get into serious debt.

 

The Franchise Model

The franchise model is a proven business formula. This is how businesses like McDonald’s, Pizza Hut, Domino’s, Subway… operate. The parent company will allow you to use their brand name and products for a percentage of your profits. You will also need to have over $300,000 just to purchase a franchise.

Franchises usually make money, because they work on an established business model that has been proven to work a large number of times. The company offering the franchise will do the research to see if the business has a potential to become profitable.

When you buy a franchise, you will be trained to use the exact same methods that are working for others successful franchises offered by the company.

You also have the brand working in your favor. If you buy a McDonald’s franchise, your customer will know what type of food to expect. You will draw in customers that are used to the McDonald’s brand.

The major problem with getting a franchise is the cost involved. Most people looking for a business opportunity don’t have $300,000+ to get started.

Even if you have the money to invest on a franchise, you will still have to put in long hours. You maybe able to create financial freedom over time, but you will not be able to create the time freedom to live the dream lifestyle.

 

The Network Marketing Model

The network marketing model will provide you with all the benefits of the franchise model at a fraction of the cost. You will get to work with a proven business model. You will also develop your business and communication skills from running a network marketing business.

Network marketing also allows you to run your business in a wider territory, you are not restricted to a local area.

The biggest benefit of the network marketing model is that you can also offer other people the exact same opportunity. This is like getting a license to offer franchises to others.

The people that you introduce to your network marketing business will earn you residual commissions. You can offer unlimited franchises (sponsor new members). These people can also sponsor other members, and you will earn commissions from the entire network you and your downline members create.

This process of duplication is the key to earning thousands of dollars monthly using network marketing. You get to leverage from the efforts of your downline members and they also get to do the same.

A network marketing business can be started on a budget of only a few hundred dollars. A franchise opportunity can cost a few hundred thousand dollars to start up.

You also eliminate the major costs involved in running a traditional business like rent and wages for employees. The product or service is distributed to your customers and network members by the company.

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