Some people are passionate about the industry, while others condemn it. Some claim all companies are pyramid schemes and scams. Celebrity authors such as Robert Allen, Mark Victor Hansen and Robert Kiyosaki advocate the industry.

Network marketing is, in its most fundamental sense, a franchise business model. Such a model provides a duplicable system that involves the continuous repetition of certain activities.

One key test of a network marketing or home based business company is whether there are large numbers of repeat customers who order and use real products even if they do not get a check. The fact is that Amway/Quixtar, Melaleuca, PrePaid Legal, USANA, and many others have sold millions upon millions of dollars of products to happy customers, many of whom are NOT also getting checks.

So why does the industry seem to have a black eye? The problem does not seem to lie with the overall franchise business model. Network marketing is just a business model, and it really amounts to "micro-franchising". It has a low cost of entry, with the potential for exceptional revenue, and there are those who achieve that.

However, the things that make it attractive make it attractive to many who are NOT really qualified or prepared to become business owners.

Some of the characteristics of these people are:

have not done well in their business or profession and have little money saved up to invest

have no previous experience owning or running a business

have no previous experience in sales

have little or no experience developing business relationships other than that of employer/employee/co-worker

are not satisfied with their current level of income

have unrealistic expectations of the amount of work involved compared to the revenue realized

From my experience, without knowing any better, inexperienced or unqualified network marketers often

over-sell the opportunity

inappropriately talk about the business in social situations

come across as desperate

focus too much on new recruits and neglect existing customers as a result

are either inaccurate or deceptive when talking about their business

What is the solution?

Read about it in my next post.

About the author

Jon Roussel is a five year veteran of the home base business industry. He owns a business in Beverly, MA and teaches business owners and others how to start and success with a home based business that will generate a long term reliable leveraged residual income. Learn more at http://www.makemoreathome.us