New times change our business and the way we run it. What I mean by rules of the game here is how you work and act in the field, and even though much of it is common sense, these days it's more and more about how you build a culture.
Randy Gage has blogged a fair bit about this and I'm referring to his post, but I want to bring it up in a different way. The world has changed in many ways over the past 10 or 20 years. How we're supposed to build an organisation today compared with how they did it back then is a big difference.
Back then you bought a package of products and acted as a reseller for a company by keeping stock and selling products. Then the business model developed so that everyone was supposed to be a team partner. Everyone who consumed the product was supposed to have a position in the structure and therefore be part of the distribution chain. Internal consumption is something the authorities don't like, which is clear when you look at both Herbalife and Vemma recently.
A modern direct selling company has a position and a licence that are free of charge, then you register external customers and that's how products reach the end consumer. If everyone is a team partner, you're stuck in a somewhat outdated business model. It has to be possible to buy products from a direct selling company without being part of the organisation.
What we're going to take a closer look at now are a few points that are different today compared with before.
1. We no longer need to be bankrupt or completely broke to succeed in direct selling. Sure, many people are driven by hotivation rather than motivation, since people generally don't do anything until they absolutely have to, but today direct selling attracts everything from ambitious entrepreneurs to highly educated professionals in all kinds of fields.
Today there are serious business people looking at direct selling as a very effective and professional business model. We have people like Tony Robbins and Richard Branson speaking highly of this way of trying your wings as an entrepreneur. Many of our Swedish speakers learned their trade in what we do. It's a completely different climate today compared with before.
2. In the past, people said direct selling was the chance for everyone without an education. They more or less talked down the traditional education system and the people who chose that path. They talked down the idea of having a job. The boss was stupid and everyone with a job was on the wrong track.
In recent years we've had leaders come in with a completely different attitude. Many people have a good education behind them and enjoy their jobs. When educated people step in and see the potential our business model has, be open and meet them where they are.
Randy Gage writes: ”Recruiting isn't about getting people into open positions you have. It's about offering them opportunities to get what they want.”
3. Income claims: passive income or leadership income.
I wrote at the start about the problem with internal consumption and not working with external customers. Income claims are at least as important to think about. Read the links above about Herbalife and Vemma and you'll understand why.
We have to stop talking about hundreds of thousands of kronor in monthly income. First of all, the companies whose leaders keep doing that will be killed off by the authorities. Secondly, it's about attracting the right people, but I'll come back to that.
Conceptually, most people can't grasp what it means to bring in 300,000 kronor in a month, and since many who aren't quite there yet are happy to exaggerate their income, it becomes even harder to believe. It turns into what my colleague Rolf calls ”MLM VAT”. Ordinary VAT is often 25%, while MLM VAT can easily be up towards 200%...
Be honest. Be true to yourself and to others. Don't exaggerate. Attract the right people for the right reason. Attract people who can see that the products have market potential. People who look forward to the work, not people who long for a passive income.
I remember a talk in Göteborg with Keith Cunningham, Robert Kiyosaki's rich dad for those who've read the books. To my great surprise he said: ”Passive income doesn't exist. If you build a system the right way you'll be able to create a leveraged income, but you'll never get away from the maintenance work, so make sure you do something you love, because you'll never be finished.”
Let's attract the right people, the ones who are after a leadership income as an entrepreneur in direct selling. Of course part of your leadership income can become passive, but without responsibility and without leadership the money runs through your fingers, I've seen it several times. The maintenance work in direct selling is about relationships. No matter how big a leader you become, you need to build your business on relationships and stay in good contact with your organisation.
4. Creating a ”become debt free culture”.
In the past they talked a lot about the luxury life. Randy Gage talked about his luxury cars. He had a blue one, a yellow one and a red one, all Dodge Vipers. One had a number plate that read ”mlm-pro”, another ”mlm-guy” and the third ”mlm-one”. It was very much about showing off the rich lifestyle you could reach by building big networks. This is no longer attractive. Not everyone wants a new car.
What's attractive today, in the world we live in, with the debts people take on, is helping people produce an income that lets them take their life back. Think about helping someone earn a few extra thousand a month. Helping people afford to get rid of that loan so much faster, and then afford to book that extra long holiday or decide to go ahead with the house renovation that wasn't possible before. Afford to go down to a four day week, if that's the ambition. To get out of the scarcity mindset once and for all.
Make this part of the message and reinforce it by teaching personal finance through your leadership. There are of course many more rules of the game, but the main thing is that we've become aware that the market is constantly changing. There's enormous potential today to start up with a modern direct selling company that does this the right way. People looking for a company to take a new journey with are looking for a healthy culture, a good system and the right leadership.
