One of the biggest challenges in sustaining a successful network marketing business is the ‘leaky bucket’ syndrome.

When it comes to paychecks, attrition can sometimes cause them to shrink faster than you can sponsor new people into your business.

People click off of autoship when they decide they have been working for too long without a payoff. Sometimes this happens in only months, sometimes a few years.

Was the hype to big? Were their expectations too lofty? Were they promised an easy time of things, just make a list of family and friends? Did they not attend enough meetings; was it a lack of effort?

Maybe the next better product came along, or the hype wore off. Maybe the huge tidal wave of a pre-launch couldn’t be sustained, and the tide is simply returning.

And it may be true that some people join simply to buy product at cheaper prices (a model of business designed for recruiting and not so much retail). And then then just drop of when a better product comes along, or when they find they can buy what they perceive to be the equivalent in a local store.

It could be any of those things, but there are a few things that would repel attrition and attract retention.

But Some Do Make it…..

Some even join the ranks of the top 2% of heavy hitters. Their paychecks grow at enormous rates at this pace in most MLM companies.

That is because most companies reserve most of the profits for their top distributors. Look at any of the income disclosure sheets you may have access to. Many times you don’t.

Yet even if there are many people you would expect only to be product users and not builders, due to an overpriced product driving enrollment, the percentages are still extremely low for people making well over six figures.

One company I was recently with had only a few hundred in that category out of over 2 million distributors.

Three years later, that company is struggling to keep the rate of growth up with the rate of attrition. Someone I spoke with who is still in that company recently told me that many of the heavy hitters she knows are seeing their paychecks reduced by as much as 80%.

So even the heavy hitters are affected by this phenomenon. Those huge six figure checks may have been reduced to tiny five figure checks. Standards of living so easily attained are harder to manage under shrinkage.

Sadly, this is not at all uncommon in this industry.

I joined that company in its heyday, going to dozens of meetings, inviting and cajoling anyone I met to come along and get in before things went completely wild.

What I didn’t realize was how many ‘one of a kind’, ‘revolutionary’, ‘patented process’ best ever products there actually were in this industry.

I didn’t realize the sheer number of ‘ground floor’ opportunities that would have distributors playing musical companies faster then their heads could spin.

I didn’t even get out a calculator and do the math on my back end commission (comprises the royalty income), not counting the other 7 ways there were to get paid (or not).

Once I did the calculations to determine the number of people I would need in my organization on autoship in order to retire, I realized I was really only making less than 3% on the residual, and that number would be well over 4000. And without retention I would never be able to retire.

Take a Deep Breath

So after a year of wearing myself out for nothing but a balance sheet in the red, I began looking into other companies and online methods of marketing. I found a simple, duplicatable system that would allow me to generate my own, qualified, highly targeted leads.

Working with people already in the industry, extending may warm market to those who truly see the value of a residual income and no longer trading time for money, took the pressure off of my relationships with family and friends.

Whether or not they want to join my business does not matter.  I am in the company of others who understand what it is I am doing, and we work in amazing mastermind groups to continue providing training along with the industry leaders in this cutting edge system.

And finding professional network marketers that do want to join you in business is much more fun and lucrative than cajoling friends and family members to try and build it.

These are the people that understand how being on autoship for a consumable product is key to building that prized royalty income.

They understand that this residual income is exactly why we are willing to work so hard at first, for the huge payoff in the long run and not necessarily today.

And they may understand well that it is not simply being “in on the ground floor” that matters. If you build it big in time to catch a fast rising wave, the tide is still going to go out, leaving you holding an empty bucket.

They have persistence and self motivation, and are most often people who enjoy and understand the value in building relationships.

They know that business is first and foremost built on relationships. Period.

…….Those are the people who are much less likely to leave your team and just click off autoship.

But That’s not All…

Choosing the right company can mean the difference between a 98% attrition rate and a 98% retention rate. A company that has

• a steady growth rate for more than a year,
• reasonably priced (and excellent) products to encourage volume for customer sales,
• encourages online sales and marketing (without charging for the multiple websites they offered),
• allows someone to own their own downline (no threat of lawsuit should they all leave for another company together),
• pays extremely well on both the front and back ends of the pay plan, with a larger percentages of profits paid to the largest percentage of distributors,
• and a team that provides a proven, duplicatable system for marketing and training

is key to gaining retention.

And when you have a team that is able to make money in their first year in a company which requires only 350 to 400 people on autoship to reach the $10/month figure, and give them a marketing and training system with which they can be part of a supportive and knowledgeable team full of industry leaders and full time network marketing professionals, your attrition is replaced by retention.

Then you can take those months off while your business continues to grow, and you are not having to meet leadership requirements to maintain your paycheck, but can leverage the work you have done.

That is how network marketing should work.

And, unless you like building it over and over again, building lasting relationships and having a solid company with excellent consumable products are the only things worth working for that can get you that coveted royalty income. On that you can hang your retirement dreams.

If you really want to grow your network marketing business using attraction marketing, test drive this powerful industry leading training and lead generation system – you’ll be amazed at how easily you can turn things around for yourself and your team. Stop struggling to maintain your leaky bucket and provide the liner that will slow your leaks to only the ever occasional drip!

Thanks and I wish you every success!

This entry was posted on Thursday, April 15th, 2010 at 2:07 PM and is filed under Core Training. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.