5 Reasons Why Working for an MLM Doesn’t Make You an Entrepreneur
I’m just going to come right out and say it: If you work for an MLM, you are not an entrepreneur— you are a salesperson.
There’s nothing wrong with being a salesperson. Salespeople can make shitloads of money if they’re great at what they do. But let’s not conflate selling a mass-produced anti-aging beauty cream on your own terms with owning a business and marketing a new product or service yourself.
Just because you reached the Diamond Level and you’re finally taking your husband on that trip to Hawaii doesn’t make you a #womanentrepreneur, Karen. It does, on the other hand, make you one hell of a good saleswoman— and for that, I commend you.
Look, I’ve sat in some of the meetings. I’ve formed relationships with people who are good at MLM sales. I get it.
For people who have that go-getter attitude and prefer to work on their own terms, MLM work can sound really appealing. They say things like “work from anywhere,” “work on your own schedule,” and “earn more than you ever have in your life.” Those are all things that entrepreneurs generally pursue in their careers too.
But just because you don’t follow the conventional 9-to-5-at-an-office business model doesn’t make you an entrepreneur.
You aren’t working for yourself
One of the cornerstones to entrepreneurship is the DIY element. An entrepreneur isn’t beholden to any boss because they are the boss.
As a network marketer, you may be able to build a network of people to sell a product that ultimately carry your line of revenue. But that doesn’t mean you’re working for yourself. It means you built a (somewhat) sustainable system of income for yourself.
If you didn’t build it, buy it, or inherit it, it’s not your business.
At the end of the day, you work for someone at the tip-top of the MLM pyramid. And yes, it is a pyramid. MLM-ers will often balk at this fact, insisting that their company is NOT the oh-so-hated pyramid scheme because it’s legal, has an A+ rating by the BBB, and doesn’t force people to buy product they can’t sell.
The model may be legal and even sustainable for some, but it is also flawed and, yes, pyramid-shaped.
Let’s not pretend the wealth created from MLMs isn’t driven by the newest people at the bottom of the pyramid doing all the sales work.
The question I will always have for network marketers who claim to work for themselves is: How can you work for yourself if a percentage of your profit always goes to someone higher up the line than you?
You have no control over the product
So, Susan, tell me more about the supplements you’re selling. What was the thought-process behind including inorganic AND organic salts in this product? Oh, you don’t know? I thought you said you owned your own business? Wouldn’t that be a decision you have to make?
When you sign on to sell for an MLM company, you’re given product to sell. You don’t get to decide anything about the product. You don’t get to make tweaks to it to make it easier to sell. You don’t even get to decide what goes into the product.
That’s a major difference between a network marketer and an entrepreneur. An entrepreneur has to continually refine their product or service and make painstaking decisions about how best to market what they’re selling.
MLMs will hand you a script and other resources to help you sell their product. They’ve already done the work of how best to market the product and have handed that information off to you to actually execute.
You have no control over the pricing
Just like with the product, you have no control over the pricing. It’s a fixed, non-negotiable price that has been formulated on the basis of how many people above you have to get a percentage of that retail sale.
In entrepreneurship, you’re always tinkering with your pricing. You have to consider overhead costs, cost of customer acquisition, and if you’re selling a product, its wholesale price.
And with pricing services, it gets even more complicated. You have to consider the value you’re bringing to a specific client and what you think they’re willing to pay.
I sell my writing services. I negotiate my own prices. I market myself. My income depends on how well I do at selling my services. If I do poorly, it’s because I didn’t sell well enough or charge enough for my services. There’s nobody below me whose income I automatically take a percentage of.
No prices are set in stone in entrepreneurship because everything is negotiable. It’s the wild west out here, y’all. There really aren’t any rules when it comes to pricing, and as an entrepreneur you have to be constantly assessing what works for you.
You’re more concerned with recruiting salespeople than selling your product
The real money in MLMs is not in how much product you can sell, it’s in how many people you can recruit to sell for you.
How many times on your social media have you seen someone post something like, “Who wants to try Product X? The first 5 people to comment will get Product X!” or “I’m looking for amazing people to join my team!”
If an entrepreneur wants you to join their team, it’s so that you can support what they’re already doing— not so they can shove all their sales work onto you so they can live off your efforts and not have to work.
Entrepreneurs bring something new to the table
Entrepreneurs are defined by the dictionary as a person who organizes and operates a business or businesses, taking on greater than normal financial risks in order to do so.
Entrepreneurs are people who make and take business. It’s grueling work. You have something unique to sell and you have to figure out how to position in it in this world to make you money.
Entrepreneurs aren’t selling an established product that thousands or even millions of other people are also selling directly. What they sell is original and can be positioned in the market as such.
Betsy, you can’t tell me your juice is better than Karen’s juice because you’re selling for the exact same company.
But I can tell somebody my writing services are better than one of my competitors because I have a unique and intensive process I use to craft my content.
If you can take away the MLM product and start selling something original on your own, then you’re absolutely an entrepreneur.
I’m not saying MLM-ers can’t also be entrepreneurs, but I am saying that being a network marketer doesn’t make you an entrepreneur.
I have great respect for MLM-ers as professionals— particularly those who are really good at what they do (and some people even use their MLM skills to support charities!). I’ll happily accept any free samples you give me, and I’ll even buy your shit if it’s awesome, but please don’t tell me you understand my struggle as an entrepreneur when you work in sales. Selling something mass-produced is just not the same as selling something unique that you’ve refined and tinkered with yourself to make income.
Meet the Author: Anya Overmann
Anya is a content creator, marketer, advocate, and Humanist from St. Louis, Missouri. When she’s not marketing her Uncle’s gymnastics business or teaching gymnastics herself, she’s busy running her own business. Anya provides digital marketing and content services to small businesses. She’s on a mission to empower others to affect change using their voices, not only in business but in all aspects of life.
Anya loves to travel and is active in Humanist communities internationally. She’s a vocal advocate of human rights, science and reason, and social justice. Anya’s long-term goal is to become a digital nomad and roam the world freely while promoting Humanist values through her business.