Today, I’m going to talk about dealing with attrition in your MLM Business. This is one of those “taboo” topics that most people in our industry are scared to talk about in a public setting. I understand why, but I also realize if you “understand” this simple concept, it will be much easier to deal with when it happens.
Attrition in the Real Business World
First off, every type of sales profession has a high turnover of sales personnel (attrition). Ask any real estate broker, insurance broker, or sales manager and they will tell you that they experience 30 to 80 percent (or higher) yearly attrition in their sales organization. Ask any retail sales manager what their turnover is among their sales staff. It’s very high.
Furthermore, ask any business owner how much attrition they have with their customers and employees. Most businesses have high attrition with both customers and employees.
Think about your local gas station for a minute. Some people who shop there are just passing through and never come back. Some customers shop there a few times each week. Some customers only shop there when the price is the cheapest. And some people shop there a few times, but never come back if they have a bad experience.
When it comes to employees, very few employees are loyal to their company. They will go to where they are paid the most. This is normal. It’s not a bad thing either. In addition, many companies are looking for ways to replace employees with cheaper employees. The days of employee-employer loyalty are long gone. Both companies and employees must look out for their own best interests first.
Think about your own life for a moment? How many jobs have you had in your career? How many different companies have you worked for? Chances are: it’s a lot!
Also, I can 100% guarantee you’ve done the same thing with different stores. You’ve shopped at many stores during your life. Some of those stores you shopped at once or twice and never went back for whatever reason. This is normal!
Attrition in Network Marketing
Network marketing is no different.
You will ALWAYS have HIGH attrition and turnover in your team, regardless of what you do, or don’t do.
It’s a tough pill to swallow, but it’s the truth. The sooner you can accept it the better.
Every year, MOST of your team members will quit. In most cases, it will be 50 to 80 percent of your entire organization will quit each year. If you have 100 people on your team this year, and no new people join, you will probably only have 20 to 50 people left on your team by the end of the year, if that. That’s why sponsoring new reps is so important in this business. It’s important in EVERY business.
People quit network marketing for a variety of reasons. Some people quit because of divorce. Others get married. Some simply lose interest. Some people get sick. Some folks lose their jobs. Some people die. Others get promoted in their career. Others find a different home business to work with.
You simply need to accept that most people quit everything they do in life. It is normal. It is okay. And there is very little you can do about it.
I don’t believe you can keep someone from quitting the business (if that’s what they want to do), but I do believe you can do a few things to minimize the attrition in your MLM Business. That’s what I will cover in the rest of this article.
Dealing with Attrition in Your MLM Business
Listed below are a few practical tips to help you deal with attrition in your MLM Business.
# 1: Build Depth & Fear of Loss
I’ve found that the best way to deal with attrition in your MLM Business is to build depth. When you light a fire in the basement everyone above them gets excited (in most cases anyway). When you help someone on your level 10, for example, you automatically help and motivate the nine levels of people above them. Boom!
When people have something to lose they are less likely to quit the business, even if they aren’t making money. No, you shouldn’t build someone’s team for them, but you can build one power leg under each person, so they have a small team, a small check, and something to lose.
When you sponsor someone, help them sponsor one person. Then go work with that new person. Help that new person sponsor one person then go work with their new person. Repeat this process over and over until you find someone serious. You might have to drive your leg 10, 20, even 100 levels deep to find that serious person. At that point, spend most of your time working with that serious person. By doing so, you help everyone above them.
“Deep down in the heart of every person there lingers a spark of hope—secret longing to be, or to have, something more.”
~ David Hall McConnell, Founder, California Perfume Co. (later, Avon)
# 2: Never Stop Your Personal Recruiting
Next, ever stop personally sponsoring new people into your team. Always look for self-motivated and sharp people that you can sponsor and work with. Talk to new people EVERY day and share your products and business opportunity with them whenever possible. Never ever go a month without personally sponsoring AT LEAST two to four new people. Always lead by example. And remember, new reps are the lifeblood of your business.
# 3: Help Your Team Members Make Money
It would be in your best interest to help your new teammates get a check as quickly as possible. You have about a 10 to 30-day grace period (max) from the time someone joins your team until they lose their initial enthusiasm (if they aren’t making money).
Do what you can do to help everyone you sponsor find three to five customers and sponsor two to four people during their first 30 to 90-days in the business. Help everyone you sponsor earn enough money at least to cover the cost of their own product purchases. When people get their products for free, they will keep reordering (normally).
Of course, not everyone you sponsor will stick around or be willing to work the business, but you can identify the serious ones and help them get a check quickly.
“Study after study has shown that people who achieve success during their first 30 days stay in business twice as long and sell four times as much over the course of their business.”
~ Alan Luce, Senior Managing Principal at Strategic Choice Partners
# 4: Educate Your Team & Teach Them New Skills
Another thing you can do to reduce attrition in your MLM Business is to EDUCATE your team about network marketing. Encourage them to read books about the industry and have them attend live events.
Develop a training program and getting started program for your new team members so they can learn about the products, the company, network marketing, leadership, sales, marketing, and other important skills.
If you can get people to see the POTENTIAL in the industry and to BELIEVE in the industry (and themselves), more people will stick around.
# 5: Build Relationships
Another good thing to do to deal with attrition in your MLM Business is to invest some one-on-one time with each team member. Try to build a friendship with them. People are less likely to quit on a friend than quit on someone they hardly know. It’s true, people don’t care how much you know until they know how much you care. Remember, network marketing is a relationship business.
The most important thing you’ve got to do with a large direct selling company is constant, constant communication. A business is an organism, not an organization.
~ John Addison, President and CEO, Addison Leadership Group
However, don’t be a fool about this. Some people will join your team, ask you a million questions, seem sincere, tell you all the right things, and still not get to work! Identify these folks as quickly as possible and work with them in a group setting, not your one-on-one time.
# 6: Create a Strong Team Culture
My next tip for dealing with attrition in your MLM Business is to create a team culture. You must realize that most people want to be part of something greater than themselves. People want to be recognized and feel appreciated. People want to be part of a team. These are fundamental human needs.
You must create a winning team culture where there is excitement, where people feel safe, where people are appreciated, and where people are encouraged to grow. Create a team culture that is so strong that people never want to leave, even if they stop building the business.
# 7: Get People Using the Products
My final tip, and quite perhaps my best tip for dealing with attrition in your MLM Business is to be product focused. From my personal experience, I’ve found that most people who join a network marketing business to make money quit in 30 to 90-days.
However, people who decided to do the business because they were a happy customer first typically stick around longer, and do much better with the business! Focus on finding customers and then upgrade some of those customers into distributors.
Get everyone on your team using the products. Help people fall in love with the products. Loyal product users are where your real residual income comes from.
All of this assumes you work with a product focused company that has exceptional, unique products at fair prices!
What Others Are Saying
Here’s what other people are saying about attrition in MLM.
Not everyone can or even should do network marketing. The world needs everyone to operate. We need farmers, construction workers, teachers, doctors, technology professionals, etc.
And even though I believe it’s the best financial vehicle on the planet, it’s not for everyone. Some people have immense love for their profession or business or job and it has nothing to do with network marketing.
Attrition in network marketing is like a filtering system. People join, check it out, get a feel for it, and either take the bull by the horns and run with it or quit for as many reason as you can count. Some because they’re unrealistic dreamers, others because it’s just not their thing and they’d rather be doing something different.
Matt Morris, MLM Legend
There is not much you can do about MLM attrition as it’s just the way people are.
Everyone wants to change their life in some way but are not really willing to do what it takes to make it happen. You can’t force people to do things.
So what can you?
- Set expectations. Before a person every joins your team, be sure to set the right expectations for them. Let them know the time and money investment it takes to get to the six figure income they desire.
- Focus on team building. Instead of focusing on money, focus on team building. This may help reduce the MLM attrition in your downline a little. Team building will help your downline see and understand a vision for their future. There is a greater chance they may actually stick with it.
- Develop a good duplicable system. Having a doable system in place will help your downline get to their goals. Get your MLM team members acquainted with a duplicable system right away so they can start participating. Work with them to set goals and plug them into team calls and company events.
MLM attrition rates are typically about 80 to 90 percent. If you know this going in, you’ll be better equipped to handle it when your downline quits.
Final Thoughts
In summary, these are just a few things you can do to deal with attrition in your MLM Business. No matter what you do as a sponsor to help your team, most people will still quit the business. That’s okay. If you can follow some of the tips I mentioned in this article you will get much better results in your business, make more money, and have less attrition.
More importantly, even if most people quit the business, you can still make a great income. You only need a few key people to build a big MLM Team and income. Ultimately, you’re looking for a few key leaders who “get it.” Those are the people you want to help and spend most of your time with.
You can’t drag anyone across the finish line or make anyone successful in the business. Trust me, I’ve tried. Your job is to realize it’s a numbers game and to work with the willing!
What do you think about MLM Attrition? Please leave a comment below to tell us what you do to deal with attrition in your MLM Business. I look forward to hearing from you. Have a great day.
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Sincerely,
Chuck Holmes
Network Marketing Professional (21+ years)
Top Recruiter & Top Rep
mrchuckholmes@gmail.com
Thank you Chucks. I have learnt a lot from this especially the recruiting aspect and also about building a relationship with your team.
Awesome post, Chuck! Your downline will watch what you do and if you don’t recruit, they won’t either. If people knew the reality of attrition in MLM they would be bullet proof if they decided to stay. Eric Worre built three complete organizations before he had people start duplicating. Also, starting a fire under your downline is great advice. Todd Falcone did a video on this and it looked brilliant. Thanks man!
Glad I could help. Attrition sucks, but it’s a common reality. Be busy replacing them, not chasing them!
All businesses have attrition with employees, contractors and customers. It is a normal part of doing business. Some industries have higher attrition than others, but it’s inevitable in any business.
I think the best thing you can do is what you suggest, help people hit the ground running. Once they have some skin in the game and win some small victories they will be less likely to quit. I think coaching is key. You can’t get too much coaching in the beginning, especially if being in business is a new concept. If you are always raising up someone new, you won’t feel the hit as much when someone falls off. But I think its better to invest more in keeping the people you have happy and productive. Every time you lose someone who has been around for a while you lose a lot more than money.
Yes, you need to spend some time with your new people. But you still need to be smart about it. The sooner you can identify someone who is serious compared to someone who isn’t, the much better off you will be.
I really like the information you shared here. I do believe that by really working with your team members to help them see financial gain relatively quickly, they will be more likely to stay. I also think it is worthwhile to give new team members a dose of reality so they know what to expect upfront. Let them know the average time it takes and effort it takes to reach a certain financial goal so they won’t be surprised or shocked and then suddenly leave when things don’t match their expectations.
Helping people make money quick is important, but if someone quits because they aren’t making money in 90 days, they shouldn’t be in the business anyway. Most businesses take at least a year to make a profit, sometimes even longer. You need an entrepreneurial mindset to succeed in this industry. Sadly, most reps have an employee mindset.
I like how you pointed out that network marketing is by no means, the only business that must deal with attrition. These tips are great. Personally sponsoring just 2 people per month is not difficult. I also totally agree on working hard with your people to help them gain a little profit off the bat. By doing so, they will realize that what they are doing is worth it. They will keep striving forward.
Great tips Chuck. Like the other commenter mentioned, keep them coming.