Build Your Customer Base Before You Build a MLM Downline

When it comes to building a successful, long-term network marketing business, I think it’s wise to build your customer base BEFORE you start building a downline.

Every distributor should make it a point to find at least 10 personal customers before they start looking for people to pursue the business opportunity.

In fact, I wish every company in the industry PROHIBITED current distributors from recruiting new distributors until they built up a small customer base of minimum three to five customers. This would help fix a lot of the problems in our industry.

I also believe that every company and every distributor in our industry should teach their team to be customer focused and product focused, rather than opportunity focused.  The “lead with the business” approach is inefficient and overused.

Here’s the truth as I see it.  How can you ethically share a money making idea with someone if you aren’t making any money yourself with it?  That just doesn’t make sense to me.

However, if you had ten customers you WOULD be making money.  You would be profitable. And you would have a simple business opportunity that you could share with others.

THE BENEFITS

There are many benefits to building a customer base in your network marketing business.

First and foremost, by building up a solid customer base you have immediate retail profits. When you make sales, you normally keep the wholesale-retail difference, which ranges from ten to fifty percent in most companies

This puts a PROFIT in your business TODAY and gives you enough money to cover (or offset) your own order, advertising expenses and operating expenses.

Even with just 10 repeat, loyal retail customers, you can easily earn $100 to $500 or more per month in profit (depending upon your company and how much they buy).

To most people that is a substantial supplemental income.  If most people made an extra $200 to $500 per month from their MLM Business, they would never quit!

Another thing that no one talks about is that it is much EASIER to find a customer than find a distributor.  Everyone, and I mean everyone, likes to spend money and buy stuff, but not everyone is looking to be their own boss.  Chew on that!

Also, retention with customers is MUCH higher than with distributors.  Happy customers order the products because they want them, NOT because they are trying to qualify for a commission check.  They normally place bigger orders too.

Finally, happy customers will typically become your best distributors, later on down the road, if you treat them well and have a simple process to upgrade them into business builders.

THE PROBLEM

Most distributors are simply taught to recruit, recruit, and recruit.  They’re taught to lead with the business, and if their prospect isn’t interested, move on and look for someone who is interested.  What a big mistake.

How’s that working out for you?

The problem with this approach is that maybe only two to five out of every 100 people are ACTIVELY looking to start a business today.  Most prospects will not be interested in what you are offering them.

However, out of those same 100 people, I’d bet that 20 to 50 of them would check out your product or service (maybe buy it, maybe not) if you approached them the right way.

In addition, it’s much easier to earn $500 per month in your business by retailing products than it is by building a team of distributors.  Yes, the big money, later on down the road, comes from team building, but in the beginning of your business you really need to be customer focused, so you can get profitable and stay in business while you build a team.

In most companies, you would need a team of at least 100 distributors, if not more, to make $500 per month. However, in those same companies you can often make $500 with just 10-15 customers. Food for thought!

THE SOLUTION

You see, it takes a LONG time and LOTS of distributors to build up a large network marketing income.  If all you do is look for distributors you leave a lot of money on the table, because most people are not entrepreneurs, nor are they looking for a business.

As I see it, there is a much smarter way to build your business.

I like to call it the RETAIL TO RECRUIT method.  You are simply product oriented.  You find a few customers.  You sponsor one or two distributors.  You teach them to do what you did.  And then you repeat that process over and over until you have a large team.

You treat your customers well AND you let them know how to get their products for free AND make money with the business.  If they are interested, help them.  If not, treat them well and keep them as a happy customer.

Your first step is simply to get five to ten customers and make a $100 to $300 per month PROFIT.  Find these customers from your warm market.

Once you have a solid customer base started, look for a few people to sponsor as distributors, and then teach them to do what you just did. It really is that simple.

This the way that network marketing should work.  Everyone should use the products, have a few customers, have a few distributors and teach their team to do the same thing.

SOMETHING TO THINK ABOUT

Think about this for a moment.  Would you rather have a team of 1,000 distributors with no customers, or would you rather have a team of 100 distributors and each distributor had 10 customers?

Hopefully, you know the right answer!

I would rather have a team of 100 reps, each with 10-20 solid customers, than have a bunch of distributors not making money who are more than likely going to quit in 90 days or less!

Remember this: ALL BUSINESSES NEED CUSTOMERS.  If there are no customers it is not a legitimate business.

build your customer base before you build a downlineDoes that make sense to you?

FINAL THOUGHTS

The bottom line is that you need to build your customer base before you start building a MLM Downline.  It just makes good business sense.

After you have a few good customers, by all means go out and recruit and build up your network.  Network marketing really is about a lot of people doing a little bit.

It’s not about being a retailing machine, however, there is a legitimate retailing component to it.

What are your thoughts about this concept?  Leave a comment below to tell me what you think. I look forward to hearing from you.

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4 thoughts on “Build Your Customer Base Before You Build a MLM Downline

  1. Diamond Grant

    I would have thought that it would take more than 10-20 people to put yourself in a good financial spot to offset costs in a business. Perhaps I just like to err on the side of caution because I waited until I had about 30-35 just so I can have that extra cushion. Building your customer base will serve as a good model later down the line to show others how to do so and how to earn profit. Like you said, if you haven’t done it how do you expect others to trust your model?

    Reply
  2. Faye

    Yes, something needs to pay the bills while you are building that down line. Plus, I agree with the philosophy that you should lead with your sales. While you are busy selling the product to those customers, some of them are busy thinking “Man, I want to be like him.” They want to be earning the money that you are, or they just want to figure out how to get the products that they already like for reduced prices, or even free. There will come a time that they ask you, rather than the other way around.

    Reply
  3. Greg Boudonck

    This makes good sense. By building a customer base, you are guaranteeing some income coming in so you will not be stressed when building a down line. Essentially the whole business runs on selling products, so, in my opinion, everyone should work first on selling the products. The business will never survive if the products are not sold. Very good post Chuck; hopefully people in network marketing will learn from it.

    Reply

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