Should I join this networking company?

"Should I join this networking company?", asked a good friend. I shared to her the many times I got burned by a networking company. One time, I joined a company then in a few month, the company closed. In another, I invested money only to find out that there is something wrong with the product. This is not a post about avoiding networking at all cost. This is a post on a guide to Filipinos on what are the things to watch out for before deciding to join the company. I have written few rules that I use before I decide to join a networking company. Following the rules will minimize the risk that you are going into (any business has a risk or two tied up to it). 

#1.The Company needs to be registered in Direct Seller's Association of the Philippines. I used to say that as long as a company is SEC or BIR registered that it's OK. But after seeing two companies close, I made it a number one rule - not part of DSAP then I will have to think much about it. 

 #2. Majority of your earning should come from product movements and not on recruitment. There are many companies now that gives huge incentives if you can recruit new members. In the end you will find out that recruitment has become the 'heart and soul' of the company. This is really bad because a real business should earn from sales and not recruitment. I always say, 'if you profit due to recruitment then maybe your company is an HR company'. Also, I would like to point out here that the compensation plan should be good. You cannot waste your energy on compensation plans that are weak.

 #3. The Company needs to have good track record (OLD and STRONG). Old is safer. The old ones are less likely to fail. I know owners of start-up MLM company might hate me for this but think about it OLD MLM companies has more established systems than the new ones. 

#4. The Company needs to be innovative. It's not enough to be OLD, the company needs to have INNOVATION. Why? Because without INNOVATION, you will have less chance for profit. You need to ask what are the products that the company is planning to launch in the future?

 #5. The Company needs to have good training. Good training is the KEY to success in any business. The promise is that MLM is like a franchise. When you buy any franchise you need to be trained to run your business. It's not enough for the company to have training in recruiting. You need to have training in leadership, communication, product knowledge, and others.

To me these are simple rules to keep in mind before you join any MLM company. The industry in itself has birthed many millionaires in the past. Some companies lure people into thinking that you will earn a lot just by 'talking to your friends'. This is not really the whole package. Joining an MLM business is a matter of picking the right company for you. I hope that you will find the right one for you.