6 Tips for Building Residual Income in Network Marketing

In today’s training, I’d like to share my best tips for building residual income in network marketing.

Residual income is a “buzzword” that gets thrown around a lot in our industry. I hope to clarify things, so you have a better understanding of what it is, and so you will have realistic expectations.

What is Residual Income?

Residual income, also known as passive income or recurring income, is the income an individual or business receives on an ongoing basis with minimal effort or active involvement. It’s the money earned from assets, investments, or activities that continue to generate revenue even when you’re not actively working on them.

Residual income is often associated with financial freedom and a more flexible lifestyle because it provides a source of income that is less dependent on trading time for money.

Common sources of residual income include rental property, dividends and interest, royalties, businesses, selling digital products, pensions, and network marketing.

Is Residual Income Possible in Network Marketing?

It is possible, but most reps do not achieve it. However, there are thousands of people who have earned residual income for DECADES with one network marketing company. When you look at the larger, more established network marketing companies, such as Amway, Herbalife, Mary Kay, Avon, Nu Skin, and Forever Living, they have reps who have received monthly checks for decades.

You won’t earn residual income if the company closes. You won’t earn residual income if everyone quits. You won’t earn residual income in network marketing if you constantly switch companies. You must choose one company and stick with it long haul. That is the secret.

building residual income in network marketing

Tips for Building Residual Income in Network Marketing

If you want to earn residual income in network marketing, here are a few of my best tips and secrets.

# 1: Pick a Good Company & Stick With it

Pick a company with sound leadership, good funding, and make a long-term commitment to the company. Pick the company you want to have your problems with. Do not switch companies. Do not be an MLM Junkie. Success is about long-term focus, not short-term opportunism.

# 2: Find & Develop Leaders

Network Marketing is a leadership business. Our job is to become a leader ourselves, and then to find and develop leaders. Reps and customers come and go like the common cold, but leaders are responsible for your major growth and long-term check. Do everything you can to identify leaders and future leaders. Groom leaders. The more leaders you have the more stable your business is long-term.

# 3: Create Systems for Your Team

Next, you must create systems for your team. The system is the solution. You want systems for your new people, so they know what to do. They must know how to get started. They must know how to build a business. You create the system, and run the system, and the system runs the business. That should be your goal.

# 4: Create a Team Culture

To build a long-term residual income in network marketing, you want to create a team culture that people want to be part of. When I look at some of these big network marketing companies, they have an awesome culture with the distributors in the field.

There are events, training, systems, recognition, and there’s a lot of excitement. People are happy to be part of that, because people want to be part of something bigger than themselves. If you don’t have those things in place, you’re not going to keep people long term.

# 5: Build Depth

You want to build your business deep in three to five legs. This is the big secret to building long-term residual income in network marketing.

Once you have three, four, or five serious people, you should drive those legs as deep as you can: 50, 100, even 500 levels deep. By doing that you will secure the leg.

Driving depth will build you a long-term business with your company. If you just go wide and sponsor a lot of people, and you don’t have much depth in your team, your business will be built on shaky ground and will eventually crumble.

Here’s what I suggest you do:

  • Find three serious people.
  • Work closely with those people.
  • Drive each leg 50 to 500 levels deep.
  • Always work with the most excited, newest distributor, at the deepest point in the group.
  • Each month, drive each leg two or three levels deeper.

Width is for show and depth is for dough! The real money is made in depth, not width.

# 6: Be Smart with Your Money

As you earn residual income in network marketing, be smart with your money. Stay out of debt. Invest your money to create multiple streams of income. Diversify your investments and be smart with your money. Consult with a financial planner and have a financial plan for your life and business.

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In review, these are my best tips and secrets to creating residual income and network marketing. It is possible. Lots of people have done it. Of course, there’s no guarantee of success. You could succeed big or fail miserably.

Individual results will always vary, but I do believe if you follow these tips, you’ll be well on your way to creating residual income in network marketing.

What are your thoughts? Do you agree or disagree? Leave a comment below to let me know what you think. I look forward to hearing from you.

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chuck holmes


Chuck Holmes
Network Marketing Professional (since 2002)
Author, Blogger, & Entrepreneur

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