The 12 Questions You Must Ask Yourself
When reviewing home based business options I was introduced to a series of questions that still hold true today. My goal was to build a part-time business from home, continue to maintain my job, and create long-term residual income. These 12 questions identified what was needed to reach that goal. I am excited to be able to share with you what I have learned so that you understand what is necessary for a successful home based business.
“For those who understand, no explanation is needed. For those who do not understand, no explanation is possible.” - ZKA
1. Is What We Could Offer Unique, Highly Consumable and Used By Everyone?
The product or service provided should fulfill the need of the average person or family so there is no reason to create the "need-to-buy". Being part of the everyday economy is what will give everyone the best chance at success. This is what creates stable residual income rather than income based on recruitment.
This would allow us to provide value to a wide audience and keep them as customers for years to come.
2. Is What We Could Offer Competitively Priced?
Being able to offer the consumer a discount on products or services they are already purchasing creates an advantage in the marketplace. Number 1 was unique highly consumable, but the price has to be right as well. That creates the perfect level of VALUE.
Without this our prospect wouldn’t have a real reason to become a customer, the business opportunity is not a good enough reason.
3. Does What We Could Offer Have a Low Entry Fee?
Many companies charge a very high fee to partner with them. Front loading of products, distributor fees and website fees. This would be a major deterrent in finding business builders to partner with. If there is a fee, it should be affordable and refundable. The residual income would need to be based on product or service and not on recruitment commissions.
4. Does What We Could Offer Have a Low Personal Production Requirement?
The products or services should be something that families use everyday, so there is no need to change the family's budget to accommodate the cost of doing the business. It should not be a buying decision; but a shopping decision. There should not be any additional requirements to participate in the business other than being a customer.
5. What is the Risk of Our Time, Money and Reputation for What We Would Offer?
We wanted an offering that would be fully refundable as well as all of the products or services ordered. That means no one that we shared the company with could be taken advantage of financially and would always be in a safe place. Everyone should have the opportunity to be successful and do it with integrity.
Would it have proven sustainable compensation?
6. The Ideal Choice Should Have a High Monthly Re-order Rate?
This is a simple statistic that will paint the picture of whether the fruit of our efforts would remain in the future. In many companies when a customer doesn’t reorder they usually resign. This is the source of our residual income (or it should be) so we would want that as high as possible. The MLM average reorder rate is around 20% but the right business model would need figures in the mid 90’s. It would be a must that customers would continue to purchase for the value of the products and services.
If our monthly re-order rate is low we would always be recruiting more distributors to cover those who are leaving, making our growth potential limited to your constant efforts.
7. Is the Attrition Manageable?
Attrition was something we needed low. If someone decided to no longer work the business it can’t mean they no longer buy the product or service. A low attrition rate means that the brand had value with or without the opportunity attached to it.
This would be the only way to build a real business.
8. Would the Product or Service Withstand the Test of Time?
Would the product or service be relative to the growth of the marketplace? Will it be around long term? We were not looking for a company built on hype or a ground floor opportunity that would fizzle out.
9. Would the Compensation Plan Have Breakaways or Binaries?
We would need to be sure to understand the ins and outs of the compensation plan and if it penalized its builders for enrolling customers that build larger organizations or rewards the non-producer in order to ensure themselves a paycheck. We needed a company that takes a stand against breakaways and secures a willable business for the future as our and ours alone.
The compensation plan would need to be built on a sense of gain rather than a fear of loss.
Would we believe in the company?
10. Did the Company Have a Track Record?
Many companies fail within the first 5 years from their founding, usually because they are underfunded or poorly managed. The concept of a ground floor opportunity is that companies will only be fruitful to the pioneers. We wanted a company to prove they were going to last, and the best way to determine that was their track record. We were in it for the long haul and wanted to make sure they were too.
11. Is the Company Financially Sound?
Many do not look into the financials, and what a shame! We wanted a company that did not start out in financial debt. A core principal for any company should be to stay debt free. So we needed to ask ourselves, will the company we choose last? Another good question to ask would be, have they ever been delayed or late in paying commissions or delivering product or service?
12. Do They Have Strong Management?
Most direct selling companies possess an MLM business model, which allows the owners and/or the managers of the company to own the "down-line". That enables them to make "their" millions and move on. This affects the decisions they make as they make themselves wealthy at the expense of other people's futures. Look for a company with sound business minds at the helm. We would need to choose a company that was built on leadership preferably from Fortune 500 companies, whose corporate employees cannot participate in the compensation plan. The company would need to be built on solid principles.
Now that you have read the list of questions that helped us all make our life changing decision, inventory your own goals and your existing default future. Then ask yourself a question, “Which one of these 12 points would I be willing to take off the page and still throw my time, energy, & reputation into?” Find a company that has real people, buying real products/services that they really need and use everyday. IT’S ALL COMMON SENSE!
It’s possible that you are already having some success with your business, but imagine if you could have all 12 Success Factors working for you. How would that impact your workload, your growth and your lifestyle?
If you are curious about the business we chose, I would like to invite you to listen to some of our members who have applied the 12 Success Factors and built the last business they will ever have to build.
Forrest Bivens
647.967.3030
purpose-focus-passion@gmail.com