What is the purpose of starting a business? To make profit. Most businesses spend more money than they make that’s why they go belly up. So why should network marketing be any different? The common belief is that network marketing is a business that appreciates in value over time. In other words, if I have a group of 100 to 1,000 people under me buying the product and recruiting more, I’d be getting richer and richer! But we all know that.
It is not the pot of gold at the end of the rainbow. It’s SURVIVING the first 6 months to 2 years!
It is common that most network marketers in a new industry typically go through a 6 months trial and error period, therefore, it is crucial to ensure that during those 6 training months, you manage your cash wisely so you can learn and make money at the same time.
Just like in normal business, most of them fail within their first 2 years of operation and struggle to make profit even if they do survive. The key to survival is CASH FLOW.
In other words, it can be summed up in this equation:
Cash today, downline tomorrow.
People in network marketing usually run out of cash flow normally after 3 months and they quit because they spend more as they build. But by breaking even as fast as possible, it gives tremendous mental strength to the distributor and he or she is less likely to drop out.
First, we must understand the mindset which is the most important starting point in getting by the first 3 months.