First, let's talk about what MLM really is. MLM is simply a multi-tiered way of selling products and/or services through a direct channel of mostly part time distributors or associates. You have likely heard of some of the more well known ones such as Amway, Avon, Tupperware and Mary Kay. Amway is considered the grandaddy of them all, getting its start in 1959. There are several facets to MLM to develop an income stream that will generate the extra money a distributor is looking to add to their bottom line on a month-to-month basis. This includes direct selling, home parties, fundraisers and residual income. This last, residual income, is where the potentially large money can be made. Residual income is dependent upon a distributor building a downline, a group of distributors under them that are doing the same thing, that is selling product and recruiting their own distributors. This builds a "tree" not unlike a genealogy tree with you at the top. Typical commissions on your downline's volume or quantity of products sold each month vary from program to program but tends to average 5% to 10% of total volume for the entire downline. Now that you better understand what MLM is, let's look at some of the myths generated by the public and media that do not understand how this truly works.

Myth #1: It's a scam
Bottom Line: This myth is generally perpetrated by former MLM'ers that were miserable failures. So you ask why were they failures? Any number of reasons could have led to their failure. Some were self-inflicted like not knowing what they were getting into, not knowing the business or product they were trying to pitch to other factors they were not responsible for such as no support or training (See #5 below)

Myth #2: It's expensive to get started
Bottom Line: In most cases, no. Understand, though, that some MLM companies have an inexpensive way to get in but push you for the more expensive option, enticing you with better wholesale prices by buying into the more expensive option. Of course, better wholesale prices translate to bigger sales when selling at retail. They make this look very attractive and most people will opt for the more expensive plan without researching what they are going to sell, how best to sell it and how fast can they turn over the larger quantity of product they just bought.

Myth #3: All the money's already been made
Bottom Line:...it depends. The factors that determine if this is a truth or myth is the maturity of the company (how long has it been in business), how many distributors they have (competition) and how common is the product (market saturation). Some good examples where this may be true includes Amway, Avon, Tupperware and Mary Kay. All these have name recognition and for good reason. They have been around a long time, their products are well known and everyone seems to be selling the products. Because of competition and market saturation, a new distributor is not likely to succeed too well. There are exceptions. Among the exceptions could be a smaller market or rural area where the products are not well known or the number of distributors is small or non-existent.

Myth #4: The products are overpriced
Bottom Line: Generally speaking, no. Most products are priced competitively with the rest of the market. Take great care when evaluating product pricing to insure you are comparing apples-to-apples. A lot of products are unique in the composition or make up of the product. Examples include weight loss products, candles and makeup. You need to be sure you are comparing general store bought products of the same composition or makeup as the product of the MLM company.

Myth #5: No one wants to help you after you sign up.
Bottom Line: This is generally not true. A distributor who wants to make money, especially residual income, will do everything in their power to support and train their downline. It is in their best interest because they make money as their downline grow their respective businesses and recruit their own distributors. Of course, this is no guarantee as you might find yourself signed up under a soon-to-be former MLM'er who is becoming disenfranchised with the business because they don't know what they are doing and are no help to anyone else (see #1 above). To avoid this, be sure YOU know what you are doing, about the company, its products, your competition and product competition. You can also bypass your immediate upline person and get training and support from their upline.

If you are looking to start a home based business, MLM can be the way to go. No, this is NOT get rich quick but more like steady and consistent. It takes a motivated person anywhere from 3-5 years to build a consistent monthly income large enough to support their family so they can quit their full time jobs and do their home business full time. If one is willing to be patient and work hard, this is achievable and the rewards are fantastic.

So what do you look for in an MLM to be reasonably sure it will succeed for you? First, I would find out all I could on the company that you are considering. Only consider companies that market products that appeal to you, as a consumer AND a potential seller. Research the product and find an angle that will sell the product. Ideally, you want a product that will essentially sell itself. It must be competitively priced, of high quality and anything unique or semi-unique about the product will certainly help. How about the people already involved in the business? Just Google the name of the company and/or product and see how many web sites are out there, investigate their content and see if they are upfront about avenues of training and support offered, cost of getting in, compensation plan (residual income) and useful information about the products they sell, looking for that "angle" that will allow the product to stand on its own and sell itself. You'll also want to check to see if the MLM has any kind of minimum volume of products you must purchase from the company each month to be considered a continuing active distributor. You will find a large majority do have quotas and sometimes these quotas can be steep.

You can never do too much research. I spent 10-12 hours researching everything I have talked about in this article before deciding to join a particular MLM. My research has paid off handsomely. While I did not choose to start with the cheapest option, they had a middle option that still gets me the minimum wholesale purchase price without an initially large outlay of cash. In the first 10 days, I sold nearly $300 worth of product for an initial outlay of about $200. Of course, your experience may vary but you see my point. I researched everything about the company, its products, compensation, avenues of training, etc. Yes, this product DOES practically sell itself so the effort put into selling the product does not require a great deal of time or work.

The intent of this article is NOT sign you up in this particular MLM but to give you an example of what happens when you do your homework and are thorough in doing it. This MLM I am involved in is not the only MLM that can get immediate results like I have. There are many good MLMs out there where you can be just as successful. Just do your homework.