MLM Talk

[Peter Arnold / Canada]

NWM => What IS Our Business PROTECTION?

Hello Business Associates:

I would like to share with you a major concern I have within our Network Marketing industry.

First, as a Financial Advisor and Business Consultant, I've seen within my practice - many, many clients over the past 26 years who have gotten involved in businesses / franchises / tax shelters, etc - without first doing their own homework. Sadly, the results could have been predicted.

Second, after 20+ years of being involved in this great Network Marketing industry as a professional, I have seen much the same thing.

In BOTH situations, I've witnessed so much shock and disbelief when things went wrong. But it's a 'reality' that we human beings tend to see only what we want to see when evaluating investments and/or business ventures.

=> WHY IS THIS?

=> In NWM - What IS our 'Business PROTECTION'?

INTEGRITY & CHANGE - Part of the reason for posting about this has to do with being able to "empathize" with the pain and suffering that comes from (negative) 'MLM Corporate CHANGE' in general - and when there's a lack of Integrity in the top Management Team, and/or in our Upline. Most often, WE (as IBOs) have little or no control in this industry over these things - and because of BAD Policies & Procedures in MLM ((that we signed far too quickly. when joining!)) - there are serious casualties later on (predictable) - that could have been prevented.

I-N-T-E-G-R-I-T-Y - Let's visit this 'most critical' KEY in more depth. Here's a page from one of my sites (scroll down) => http://www.Keys2Success.biz/4.html .

Personally, I have experienced just what CAN happen ((from a lack of Integrity at the top)) in the past - 3 times. But again, I see it all the time too, because of my close involvement with our DRA (voluntary - non-paid).

NO - NOT 'MY' COMPANY! - We all believe and hope and pray that such a misfortune can "never" happen with the company(s) WE are associated with. It can - and DOES happen - and it can be a devastating blow to the distributor (and family), on many fronts - both emotionally and financially. It can pertain to 'changes' in - comp plans - corp. missions - new product launches (without readiness) - dictatorship by Uplines or Corp. to the field - changing from NWM status to that of Direct Sales - a 'hit' by the FDA // FTC against an uncompliant Co or distributor (which impacts 'everybody') - change of ownership (or leadership) - going public - on and on.

RECENT 'SITUATIONS' - Yes - these things DO happen - all the time - and some of these end up being real 'horror stories'. As an example, on our DRA Executive Board Meeting Call this week (2, 1/2 hours long) - much of the Agenda focused on this. We heard both the DRA Chairman + the President tell us all of 7 different 'unjust distributor terminations'!

1)- He Lost His HOME - One was a situation where the distributor had built his check to almost $30,000/month, after a number of years - and simply because suddenly, he was unable to provide his MLM company with the actual "receipts" of his required 5 monthly Retail Sales - they terminated him. The 'reason' he couldn't DO that was because he had just "lost his home" - it was flattened by Katrina! And the 'company' already knew about it. But here's the irony - even the IRS gave him latitude, and agreed to 'work' with him at resolving things!

Where was the 'heart' of that company CEO? -- Where was the INTEGRITY of that Management Team? The sad fact is - when that distributor signed his Legal Agreement with that company (the P&Ps) -- he didn't bother to read the 'fine print' (just as 'most' don't - tragically). If he had done his 'due dilligence' ahead of time - he would 'never' have joined that company. He doesn't have a (legal) leg to stand on. He thought he had developed a 'wonderful' relationship with the top brass of that company - yet, when they saw an opportunity to 'grab' an extra $30,000/month revenue for themselves, they chopped him out of the picture and 'took' it.

2)- She Became PREGNANT - Another had to do with a lady who had been associated with her company for about 4 years - had built a nice downline - had built her check to about $4500/month. She became pregnant. Her pregnancy developed into a serious health problem. She had to "back off" for a couple of months. During that time - her production stayed fairly constant -- but it didn't GROW, as it normally had. After she delivered her (healthy) baby - she wanted to 'resume' her Home Biz. To her utter shock - the company had already 'removed' her entire downline - and placed it under someone else (someone who was able to "keep on building". Her position was terminated - the 'check' she depended on (and worked her 'heart' out to build) - was gone.

The 'response' from the company? - in essence, "Business is business - we can't wait around while someone decides to slacken off!" - Yes! - But again - this company had its 'own' tracks covered -- she had NO recourse -- she had "agreed" to this possibility when she signed that Legal Agreement (her P&Ps) in the beginning -- she just didn't take the time to read it, or have it properly reviewed by someone else - who 'understands' these Agreements (or, she would 'never' have signed it). She had simply TRUSTED her company (as do most of us).

SURPRISE - The shocker here is - BOTH of these companies are BIG "well known" companies in our industry. BOTH are "long term" companies (one is 'publically traded')!

MORE - Here are a few more (lawsuits) => http://www.MLM-DRA.org/Terminations.asp

ATTORNEY'S PERSPECTIVE - From one of the top MLM experts...
=> http://www.davideisenstein.com/Library_MLMPerfectStorm.html
=> http://www.davideisenstein.com/Library_DavidandPennyBookExcerpts.html
=> http://www.davideisenstein.com/Library_MediationArbitrateLitigate.html
=> http://www.davideisenstein.com/Library_ArbitraryDownlineMovesByCompany.html
=> http://www.davideisenstein.com/Library_RCTerminations.html

CONTRACT Law - Even though we might say (in the 2 cases above) that the company 'behaviours' were CRIMINAL in scope (they were) - the fact is, this is all about CONTRACT Law - and once we sign that "contract" (the Policies & Procedures) without 'knowing' about any of the "gotchas" in it - we usually have NO comeback later. None.

WARNING - Even after some distributors "see" RED FLAGS written into their P&Ps - they often take the position of ignoring them - rationalizing that => MY company would "never" invoke those! My rapid response would be - why are they written in there then? Another reality is - many are already 'making substantial checks' => and it's just "too painful" to even contemplate having those checks STOPPED by their company. BIG mistake - as the risks are high.

Being INFORMED - What we need in our industry is a widespread program of EDUCATION - not to "pit distributors against companies" -NO- ... but to better INFORM us all, in this area of business dealings. IS it the 'end of the world' if this happens to us? NO, of course not - but 'starting over' - again and again and again - gets pretty rough. Far better to pick a GOOD company / Biz Opp in the beginning. There are no "guarantees" obviously, with ANY we might select - but we can absolutely enhance our chances for success, through proper 'due dilligence' [which means in part, finding a company with at least ((5)) Major KEYS already "in place" for our success - see link at the bottom].

DUE DILLIGENCE Program / 10 Steps - From Rod Cook (CEO / MLMWatchdog / DRA)... http://MLMWatchdog.com/INTERNET_DUE_DILIGENCE.html

STANDARDS - One of the problems we face is this => our NWM // MLM industry is still largely UNREGULATED (as were the Franchise / Insurance / Real Estate industries at one time too). Prosecution is difficult - because there are NO "standards" yet in our industry to serve as a 'reference' point. However - that is about to change - as our DRA is about to publish it's own Book of International Standards. This will be a 'milestone development' for this industry - and for Network Marketers everywhere. DRA 'members' will automatically receive their own (hard) copy, as part of their annual dues.

POLICIES & PROCEDURES (P&Ps) - Yes, the 2 cases above are heart-wrenching - hard to believe => BUT these are only the "tip of the iceberg" of what's happening in our NWM world. And they point out SO clearly - just how much control the companies do have (currently). Very often, distributors don't even know "where to find" these harsh Legal Agreements (their P&Ps). And even if they could - most don't "understand" them. Very often, the companies "hide" them on their Websites (or bury them deep in the Back Office) - and for good reason [[they don't want them fully 'understood']]. Very often, these P&Ps can be 50-60-100 pages long! The DRA believes that NONE of these P&Ps should be more than 15 pages long. None. Worse, some MLM companies actually 'force' you to JOIN before you get a chance to "read" their P&Ps ((even though you had to tick a box that 'says' you already read them))! Hmmmmm...

WHAT ABOUT MY COMPANY's P&Ps? - When you study your own P&Ps - if you see some things in there that trouble you - go to your top Upline Partners and discuss it with them. If that doesn't give you any real comfort, go directly to the Management Team - and ask them WHY they're in there? Don't accept 'boiler plate' answers - ask if they will consider "changes" to certain parts of their P&Ps (will they soften them - or remove them altogether, etc?). Become 'proactive' - look out for not only your 'own' security - but the protection of all those people you bring in, under those same (legal) rules.

Conscience - I truly believe that we need to look in the mirror and ask ourselves - do we feel RIGHT in bringing others into a situation that we know could end up really "hurting" them at some point? This is where 'the rubber meets the road'. This is where we test our own integrity.

'MR XYZ Co' - And can you see how - if a company "gets itself into trouble" - that it would also "hurt" US - especially if the NWM company we were 'associated' with was receiving a TON of negative publicity because of a lawsuit, etc? If we are "branding" ourselves out there as - "Mr. XYZ Company" -or- "I'm a Rep 'for' ABC Co" -- WE can (by association) get blemished. Think about that.

We need to position ourselves "at arms length" from those companies we're associated with. We need to have our "own" IDENTITY -- UAF (Unique Attraction Factor).

OUR 'RIGHTS' - Companies need to start 'recognizing' our rights as INDEPENDENT CONTRACTORS - and not shroud themselves in the convoluted maze of SO many P&Ps // T&Cs (Terms & Conditions). Currently, the OWNERS of too many NWM companies - and their bank of ATTORNEYS - are the ones in the driver's seat. The "reality" is - currently, THEY are the ones with the most control - they call the shots .

CONTROL - What we need to remember is - although many NWM companies may "control" us (for now) -- they still do not 'OWN' us. We own our 'own' businesses. We are (or should be) biz "entrepreneurs" - "risk" takers - business professionals. And as such, we need to take every step we can to "protect ourselves" - we need to "be prepared" for possible future "negative changes" within our NWM companies (like outlined above).

THE 'LOVE AFFAIR' - What this means is (again, my 'own' opinion here) -- we, as IBOs - need to maintain a certain 'distance' from our NWM companies if possible ('separate' ourselves to some extent). Quite frankly - I believe WE need to treat THEM - almost as OUR "employees" to a large extent. After all => where would these companies BE "without US?

Now, before you hit 'delete' - this doesn't mean we can't "love" our NWM company(s) - it just means we should exercise a little 'caution' - and not be "in love WITH" them (there's a BIG difference) - because we become too 'vulnerable' if (when) things go terribly wrong.

CAUTION - Some in this industry actually seem to get to a point where they become a little too 'smug' about that love affair - that absolutely nothing could ever go wrong. Well, I feel this attitude could come back to haunt them (I've 'seen' it happen). I believe we need to BE (and be seen as) IBOs - with our own separate IDENTITIES.

DIVERSIFICATION - I know this is always very controversial - but I believe we need (under certain circumstances) to adopt a similar philosophy to that of professional Insurance Advisors - Investment Counselors - Financial Planners and Stock Brokers. They PICK AND CHOOSE the different companies from which to 'select' the products and services that 'best suit' their client's individual needs - and they FIRE those that 'mess up'. In other words - THEY are in control - and they belong to Professional Associations - have the strength of a 'unified' GROUP - speak as one voice.

VENDORS - I believe in having a cohesive TEAM of business partners IN PLACE - so we can have our 'own' strength - and we can think of NWM companies as being "vendors" of excellent products and services - for ourselves - our partners - our customers / clients.

The TEAM - Please understand - this is not to be "disrespectful" of our companies -NO- it is simply to take a smart 'business perspective' on this. When the TEAM can "keep together as a solid marketing unit" - built because of - trust, respect, loyalty, comradare, and caring RELATIONSHIPS - there's little fallout or disintegration of partners. And then -IF- things should go terribly wrong in future - we do not need to 'fall in a heap' - we can 'survive' the trauma - we can simply "push and play" another NWM company - and move (as a Unit) - without that financial or emotional devastation that 'usually' occurs. And when all is said and done, NWM companies cannot really "prevent" that from taking place.

DRA - Sheer 'NUMBERS' - By far, the best way that we in this industry can "protect" ourselves from ruthless actions by some Companies (and some Uplines) is for us to become a "force to reckon with" - through the DRA. Once our membership is SO strong - all over the world - we will be better able to "exert pressure" - "enforce more accountability" - bring about "negative publicity" (companies are terrified of that). There is always "strength" in numbers. We'll soon bring an END to sickening stories like the ones above + those taking place as this is being written. Again, 'my' opinion.

Be sure to visit the DRA Forums/Message Board too - there's some excellent information there ( http://www.MLM-DRA.org ).

POSITIONING - To me, it all comes down to acting like a BUSINESS PERSON - to "being informed and prepared" - to simply "positioning" ourselves for the future, in the best possible way.

It's About 'BALANCE' - YES the companies must have RULES - YES they must protect themselves. No question about that whatsoever. But beyond that - distributors have the right to expect that their chosen company (and its employees) be honest - and treat them courteously. This is all about a 'balance' between the two - a mutual respect between the parties. Looking at the bigger picture, success within this industry is really like a 3-Legged Stool => the COMPANY => the DISTRIBUTOR => the CUSTOMER. If any of these 3 Legs of the stool "disappear" - the whole thing collapses - it's gone. The simple truth is => we ALL need each other. It's not very complicated.

NWM 'BIZ MODEL' - In conclusion, the above in NO way takes away my "love" for this industry. In fact, my passion for NWM is stronger now - after 20 years - than it's ever been. It's as strong as it has been for my Business and Financial Advisory practice. Network Marketing's 'business model' is the finest on the planet. There is NONE better. None. And that's especially true when we factor in - the power of Economic Leverage + the beauty of Passive (recurring) Income + all the new Friendships we make + + + +

BOTTOM LINE - Let's become a little smarter as business professionals -- let's not become 'intimidated' or 'victimized' by NWM companies ((BUT let's appreciate that not ALL companies or P&Ps are bad)) -- let's carefully read (and understand) our Policies & Procedures -- let's PROTECT ourselves, by joining (and 'promoting') our NON PROFIT DRA.

Here's to much success and happiness in your future.

Sincerely / Peter A.
www.PeterArnoldOnline.com

Peter Arnold, CLU, CFC // Founder
www.BusinessAchieversAcademy.com

5 KEYS 2 Biz Success: http://www.Keys2Success.biz

Executive Regional Director for the D-R-A // Canada
Distributor Rights Association: http://www.MLM-DRA.org

DRA: MLM//NWM - The Distributor Rights Association
DRA 'Bill of Rights': http://www.MLM-DRA.org/BillOfRights.asp
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DRA - a global organization formed to protect and defend the rights and
incomes of Network Marketing professionals against any unfair conduct by
NWM (MLM) companies. Serious Network Marketers need to be members of
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[Peter Arnold / Canada]

Please see article above

Peter A. / Canada