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Build Strategy

Article by: Jeff Jordan
September 16, 2013

There are a number of things to consider when you look at the build strategy for your MLM, direct selling, or party plan company, the number one question is: What do you want to be when you grow up?

This question might seem a little elementary but really think about this. What do you want to be as your company matures, many of my clients over the years have not considered or planned for what they want to be down the road, they simply focus on getting the company started and off the ground. This thought process is very dangerous when your company succeeds, especially if it grows fast. Everyone who starts a company plans on its success and wants it to grow fast!

Let me ask you a question? Have you ever known anyone who built a home? Did they start putting up walls and framing the roof without a foundation? If you went to your local municipality and showed them a set of plans that didn’t include the plumbing or the foundation they would not only think you were crazy, but would not allow you to start construction! However there’s no such building department for starting a company, so on a regular basis entrepreneurs start direct selling, MLM, and party plan companies without any foundation.

I call build strategy the foundation for your company. Let’s take a look at some of the questions you should be asking yourself when starting an MLM/direct selling or party plan company.

What style of compensation plan are you going to use?

This really isn’t the first question that should be asked but since it’s the one everyone always asks first, I’ve listed it first. Until you’ve answered some of the following questions you can’t really even talk about compensation plan.

Is your strategy business/opportunity first or is it product first?

And once you have determined this question then the question becomes what are the ratios. Do I want 60% opportunity 40% product or 70% opportunity 30% product or do I want 70% product 30% opportunity. Understanding this question and determining this ratio can be quite a process but, moving forward, this will always give you a yardstick to measure if you’re on the track you planed.

Do you plan to gather/attract customers at the corporate level?

This is an important question. As a company, to be successful, you have to think like a top distributor and always look for ways and systems and tools to attract customers that can be happy users of your product or be converted into distributors. The customer is king. Whether you build your company with customers or whether you use the customers to attract key distributors, either way is a valid concept.

What level of leader/home-based entrepreneur do I want?

This question is key to your building strategy. It’s very simply. Do I plan to build my business in a one-on-one grass-roots way? Or do I want to go out in the marketplace and attract MLM, direct selling, or party plan professionals? You can use one or both as a strategy to build your business if you choose to use both then we have to discuss what are the ratios?

What is your burn rate versus capital?

How much capital do you have to fund this venture with and what will your expenses look like moving forward. Said another way how long do you have to make the company work? This is critical to understand as it helps you choose all of the correct build strategies as we work together through the above questions.

Today Jeff Jordan focuses on his consulting practice to the Network Marketing & Direct Selling industry.  He specializes as an Interim Vice President of Sales for a few companies at a time, which allows his clients to afford the VP of Sales & Marketing expertise without the expense of hiring a full time executive.

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All Articles, How to Start a Direct Sales Company

Jeff Jordan

Jeff Jordan focuses on his consulting practice to the network marketing & direct selling industry.  He specializes as an Interim Vice...

Read more Articles by Jeff Jordan

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