Many people go into multi-level marketing businesses because they have heard that by setting up their business correctly, they can continue to earn money even when they aren't directly selling items. This is true for most MLM business opportunities. Passive income can happen in an MLM business in any of several ways, depending on the rules of the individual business.

Most MLM businesses have the concept of the downline. The downline is salespeople that you sign up to sell under you that benefit from the tips and training that you give them. Why train people to sell items instead of selling them yourself? Because with a downline, you receive a percentage of the commissions they earn. If you are successful in signing up a large downline, or even one or two good sellers in your downline, you will be set up with a passive income that keeps coming in again and again during each sales period, even if you never sell another thing.

In some MLM businesses, there are more than just these two levels. You may earn a percentage of the commissions earned by your downline's downline. If you sign up just three or four people who sell items regularly, and they each sign up a few people, imagine the passive income that will be possible. This can be so lucrative that many sellers actually strive to set up a long downline rather than to actually sell the products themselves.

If your sales are made online, there are even more possibilities for passive income. Unlike selling through a sales party or using a catalog to make sales, a website is open all the time and can take sales around the clock every day of the year. Once you get your website and your marketing in order, sales can come day and night, even when you are out of town or taking a week off from your marketing activities. Online sales that you direct toward the main site for fulfillment require very little on your part in order to see some passive income coming in regularly. This frees you up to push more products online and to try out new marketing strategies without losing that passive income.

Passive income is something that every business person strives for. In MLM businesses, it's a normal part of doing business. If you haven't yet had the thrill of passive income coming to you, you may not know how good it feels to know that there will be money coming in even if you are unable to work for whatever reason.

The magic of passive or residual income is you can have unlimited number of these “Income Streams”. So even if your MLM monthly income is only $300.00, imagine if you had ten or even 20 of these passive income streams? I can tell you from experience that if you set up ten such businesses a few will bring in much more than $300.00 a month! I know one such marketer who has almost 100 of these streams and his income is well over $30,000 a month!