The basis for proper evaluation

When it comes to choosing a business opportunity to join, doing your homework (also called "due diligence") is intelligent behaviour. But the Law of Success is highly specific, and we ignore it at our peril. It says...

"Do only the right things for only the right reasons."

So it's vitally important to use the right basis for evaluation. We need to ask the right questions about the right topics, for all the right reasons, or we can be easily side-tracked into an impressive – but meaningless – "analysis" that ignores the things that need to be considered for a reliable assessment.

For example, you may be encouraged to analyse the company and its management on the basis of questions and answers like this self-serving, reveal-nothing nonsense...

Q: Who's running the company?

A: Joe Schmoe is the President. He has thirty years of experience in network marketing and understands what needs to be done to ensure success. He has degrees in law and business, plus an MBA from Harvard Business School. Joe was Vice President (Sales and Marketing) of Humongous Conglomerate Inc for ten years and is married with seven grown-up children.

This may all sound reassuring, but it means very little when it comes to evaluating his suitability for success. His thirty years of MLM experience may have been as a network "heavy hitter" who made millions by deceiving and exploiting others. Other experience in conventional businesses may be irrelevant, since most businesses operate on FIRST Generation principles and practices – which won't (can't!) work in Fourth Generation systems like network marketing. And while it's admirable that he's married with several children, it has little relevance to running a successful network marketing business.

Far more relevant and useful are the answers to question like these...

• Does he understand why network marketing works – not just how it works? (Few do.)
• Does he know and understand the principles that govern Fourth Generation systems?
• Does the compensation plan treat all stakeholders – the company, the part-time distributors and the full-time professional distributors – fairly and equitably?
• How exactly does the compensation plan eliminate breakage to the company? (Not just earnest assurances that it does!)

To properly evaluate any MLM opportunity you need to consider these five crucial factors, in this exact order of priority. If anyone tries to show you a different order of priority, they’re either trying to hide something, sell you something, or they just don’t have a clue. Either way, it makes them highly questionable as business associates. (I'll reveal the reasons for this order as we proceed.)

• The company
• The compensation plan
• The products
• The systems
• Training and support

Now, before we go any further, please note carefully that these five factors, and this order of priority, apply only to proper evaluation of an MLM opportunity... once you've made your choice, other factors and priorities become important. Try to remember this important point. For example, training and support become much more important once you begin building your chosen business.

In the pages that follow I'll ask a number of probing questions for which you need to get satisfactory answers before joining, or you'll risk failure... often very expensive failure.