Maybe this might be something you guys can share with those who don't understand the difference. This article, is one I found on the Internet. Feel free to copy and print so next time you're on the phone or emailing send them this (make sure you don't take credit for it though...it's a great article and the guy that wrote it deserves that credit). It has 110% helped my business and those who join are fully aware and in understanding of what's going on. What I can't stand is business builders who don't educate their newbies! By the same token I have low tolerance for naive people who choose to stay ignorant to the difference. Nonetheless, I hope this helps.
This is Long ... but it's worth reading. I also give credit to the guy that wrote it and you should to if you use this. Not a good idea to plagiarize!
Written by:
http://www.network-marketing-works.com/
(plus I put in our company info for my team, but that's all I added to it)
A network marketing business in reality is a business school; you are or should be in a training program from day one. This truly is a Learn while you earn Program. The training if it is quality training is life changing.
There are many different opportunities that in reality are a network marketing company, but they refuse to call themselves that. Each of these companies is best described as a non-traditional form of business, so what’s the difference. In a traditional business you have lots of overhead, employees, health insurance for your employees, office rent the list goes on and on.
Non-traditional businesses are generally worked from a home office. This eliminates the high overhead of the traditional business. In today's high fuel prices one can save up to several hundred dollars a month in just fuel costs by not having to commute to a JOB.
Let's compare
Network marketing (IAB is)
They usually offer reasonably priced products and services that people consume in a short time. Generally the commission structure is less up-front then the direct sales companies, but it has a benefit that most direct sales companies do not have and that is residual income (on going income a month that you don’t have to work for again).
• It costs less to get involved with this form of business.
• Allows more people to become involved.
• Builds Residual Income.
Network marketing is about sales and distribution, but a different kind of sales. It’s more of a soft sale or recommendation then the hard closing type that you’re accustomed to with the typical salesman or saleswoman in the direct sales.
Direct Sales Companies (IAB is not)
These companies are known as seller-based, they market higher priced, usually one time sales items. The benefits of these programs are you make higher commissions but they have very little if any residual income. Essentially if you stop working so does your income.
You are paid directly on what you personally sell, so you have to sell lots and lots of merchandise. This also limits you to the type of people you can bring into your business as the “salesperson” type. Direct sales cost more to get involved with usually in the thousands of dollar range, again limiting you on the number of people!
In Network Marketing we help and assist others in building their business. We are also leveraging their time, with each of us is gathering customers along the way. Hence the name Network. We get paid for this because we are assisting, coaching and helping them to establish their business. Helping them to reach their goals for their financial future. So It’s only right that we also get paid for our time?
Just like your employer leverages your time, through network marketing you can leverage the time of others. What does this mean?
Let’s take a look at a typical employer in a service industry with 100 or more employees. That has a labor rate of 60 dollars per hour. The goal of our employer is to keep each employee active and busy for each hour paid.
Out of this once all the costs of doing business are factored in such as wages paid, health insurance, unemployment insurance, federal taxes, state taxes, fica taxes, permits, maintenance, housekeeping, the list just goes on and on. The employer may get to keep 5 to 10 dollars per hour of that labor rate.
In Network Marketing, we have our initial start up costs anywhere from just a few dollars to several hundred dollars (in this case with IAB you can start up at only $57.90 a year…that’s it). Where most network marketers fail is they feel that they don't need a marketing budget for advertising, they don't seek out the education required to succeed.
One of the important things to remember is, you are in a real business, and you no longer have a boss holding you accountable. Your success or failure is dependent upon you and your actions.
Your primary task will be to gathering customers for your products or services. To help and assist others get started in their own business partnered with you. You are looking at a business model that will take 3 to 5 years to produce the kind of results you’re looking for.
So don’t give up your day job just yet. It will require 5 to 20 hours of consistent time and effort each week to build a successful Network Marketing Business. It will require a marketing budget; most people do not even consider this. Once again this is a real business this is your business, not a get rich quick overnight program, although it has been hyped by a great many naive marketers and web sites.
Network marketing is based on word of mouth advertising which is the most effective form of advertising. Think about it when you go out, watch a great movie, you will go out and tell people about it. When Sam’s club or Costco moved to your area, you joined their buying club and started telling everyone how much you saved. This is the power of word of mouth advertising.
Major advertising agencies and companies count on this. This is one of the things that we do as network marketers. The major difference is that we get paid for our word of mouth advertising.
One of the most often asked questions is will I have to sell products and services? The answer is of course yes. Think about it, no one likes to have a salesman or woman come to the door and sells them products right. We hate to go to the automobile dealers, where we are swarmed with 5 different sales people all trying to get you to buy from them right!
So how are we as a network marketer different? We recommend products or services that we like and personally use. If we know it’s good and personally uses it, recommending it to those who have requested this information is very easy.