What Is Network Marketing? : Direct Sales vs. MLM -- Part II

Direct sales and MLM are subsets within the network marketing industry.

In Direct Selling the profits or commissions for a retail sale is paid to one or joint sales consultants.

In MLM the profit or commission for a retail sale is shared between the sales consultant and an up-line or recruiter. In MLM bonuses are paid based on recruiting activity provided the recruiting results in ongoing retail sales activities.

Direct Selling Association (DSA) is the national trade association representing the leading companies that manufactures and sell products and services sold directly to consumers, primarily through an independent contractor sales force. It is an elite rank of more than 220 active and pending member companies in the U.S.

Each DSA member company pledges to abide by the Code of Ethics, Standards and Procedures as a condition of admission and continuing membership in DSA. Click on this link to learn more about DSA. http://www.dsa.org/

DSA Code of Ethics expressly prohibits pyramid schemes, deceptive or unlawful consumer or recruiting practices, misrepresentation of earnings or sales potential, inventory loading and unreasonable entrance fees.

In 2006, U.S. direct sales were more that $32 billion with more than 15.2 million direct sellers nationwide. Approximately 90% of direct sellers operate their business part-time.

Before you jumping into any opportunity, you need to do your due diligence and look for companies with membership in the following organizations: Direct Selling Association (DSA), Multi-Level Marketing International Association (MLMIA), and Multi-Level Marketing Distributor Rights Association http://www.mlmia.com/ , and (MLM DRA) http://www.mlm-dra.org/. It is your life, time, and money, and you need to protect yourself.

Traditional Businesses vs. Network Marketing
In a traditional business a company has to spend millions of dollars on advertising, employee salary, benefits, support staff, travel, office space… before any product is sold.

The history is there to prove that very few employees will ever achieve personal independence or create residual income and freedom from a traditional job. Each of us, even professionals are only producing linear income.

We are constantly trading time for money. If we are not working or if a professional is not seeing clients or patients, there is no income to be received. For most of us our income is temporary, because if we couldn’t work for 90 days, there is no income. Our income is temporary. In network marketing, a person can stop trading time for money and create a stream of residual income.