Attention Network Marketers: Imagine Having All the Capital You Need! Part 2

Network marketing opportunity "buy-in" prices range from less than $30 to about $500 throughout this dynamic segment of the direct selling industry.

Usually, you get a "business kit" that includes excellent product knowledge information, a few marketing tools, and other knowledge--such as tips on developing a contact list--sincerely designed to help you succeed as a home based business owner in the network marketing segment.

You buy in! You get your kit. You go to work! Then unrevealed business expenses explode around you like a skillfully disguised time bomb. Check the numbers!

On your full time job, your take home pay totals $2,264 per month, and after bills, including daily transportation, you have $75 unclaimed money each month, or $900 annually. Now that you're "in business," you discover, much to your dismay that your sponsor and others expect you to attend weekly "business" meetings, usually in a local hotel, that cost $250 annually. That's $5 per week times 50 weeks. Your sponsor also urges you to attend the company's annual convention that will run at least $975, and often more, depending upon numerous variables. Marketing materials, such as brochures, business cards, CDs and DVDs, will cost about $240 annually or more. Other marketing expenses could run as much as $1,200 or more your first year "in the business." Setting up your business properly which means, among other things, registering it locally, federally and statewide, along with choosing a business entity that will not endanger personal assets could cost as much as $750, again depending upon several variables.

Work the numbers! Most of you cannot afford to grab the dream of owning and operating a successful home business. That's the principal reason more than 80 percent of the individuals who try these ventures drop out without ever earning any "extra" money, as they were promised in the various "business opportunity" meetings. All of these people are not lazy. Most of them simply cannot afford to launch and sustain a home business long enough for it to become profitable.

Additionally, most of the individuals who buy the "business opportunity hype" also do not know how to operate a business successfully. You see, they've been employees all of their working life. They think and behave like employees. In other words, even when they know how to do the work of their business, they often do not know how to do the business of their work., according to Michael Gerber, one of the nation's foremost advisers to small business owners.

Consider this basic example.

According to a spokesperson with the Direct Selling Association, that I spoke with, at least 95% of network marketers operate as sole proprietors. That business entity exposes both your business and personal assets to litigation. You can protect your assets by encasing this contract--with the manufacturing company--aka the "opportunity" in another business entity. For more details, please read Part 6 in this series: Do You Know How to Protect Your Assets?

Therefore, your first year business expenses, using the numbers above as examples, total $3,415. Those estimated business expenses average about $285 monthly. Most new network marketers try to fund their Business Operating Budget (BOB) from revenues--selling products and services--to their so-called warm market. Just to break even, you will need almost $290 in commissions each month during your initial year in business. Using, just one of the contracts in my consortium of companies, I would have to have 20 customers who spend at least $50 each month. This produces $1,000 in retail sales. My 30% commission generates $300 in monthly business revenues. It requires astronomical numbers to calculate the chances of this approach working consistently.

Okay, what if you use your personal money?

Even if you use the $75 "unencumbered" money you have from your paycheck, your Business Operating Budget (BOB) includes a $209 monthly deficit that totals about $2,500 annually.

As I said earlier, that's one of the principal reasons that about 80 percent of new home based business ventures fail soon after launch--inadequate capital to fund the company's BOB. In other words, you cannot pay all the "Bills" in your life, and fund the "BOB" of your home-base business on your paycheck-to-paycheck lifestyle.

You need an Action Based Capital Development System (ABCDS). That system currently exists. You do not have to invent it. You need it revealed to you and you need to learn how to work it. Remember, I've written frequently in this series that seven strategic statements describe the powerful performance principles of action-based success.

Here they are again:

Get started
Develop a powerful W.H.Y. for your venture
Become and remain teachable and coach-able
Learn to master systems and process thinking
Work S.M.A.R.T.
Work hard
Never quit

These principles power the ABCDS you need to fund the BOB you need to design, develop and deploy a successful home based business. This action based capital development system includes the following projects:
The federal funding source project
The Building Strategic Capital project
The networking project

In the federal funding source project, you will learn how Congress has positioned the Internal Revenue Service to be your "business partner," not your enemy. You will learn that the country operates two distinctly different taxing systems--one for employees and another one for business owners.

In the Building Strategic Capital project, you will learn how to get double the bang for your buck. You will align with and activate a powerful principle favored by the legendary Zig Ziglar who declares: "You can have everything you need and desire in life if you will just help enough people have what they need and desire.

In the Networking project, you will learn how to live a powerful financial principle stated this way in the Bible: "Give and it will be given to you, a good measure pressed down, shaken together and running over shall men give into your bosom. And with the same measure you use, I will measure to you again.

Each of these projects in this system provides residual capital that comes in month after month, after month. Anyone can master this system. It works if you are employed or unemployed. This system works even for individuals receiving social security and/or disability checks from the government. You do not need a college degree, any previous business experience or even a high school diploma to learn how to master this system. Single mothers with young children can learn to use this system to achieve financial freedom. Individuals recently released from prison and who face awesome challenges trying to re-integrate into society can use this system. In addition to the powerful success principles I mentioned above, a person must also be or become:
Solution-oriented
Credible
Confident
Cooperative
Committed
Communicative
Consistent
Computer literate

As I use the terms above, solution oriented refers to a person who believes that solutions always pre-exist problems. Credible refers to a person who behaves honestly and responsibly. Confident refers to a person who learns to expect victory, despite the circumstances. Cooperative refers to an individual who learns that cooperation aligns us with abundance, while competition focuses us on scarcity. Committed refers to a person who gets in it to win it, and never quits. Communicative means a person who speaks factual, data-based and provable truth. Consistent means an individual who does the right things correctly. Of course computer literate means simply knowing basically how to use the powerful technology tools we have to achieve the outcomes we all desire.

I use this system. My business partners use this system. It works famously. Try it! You'll like it!