The lure of a hugely successful affiliate and MLM home based business cannot be denied.  Who wouldn’t want to generate commissions by selling products and to engage a literal legion of distributors (those who sign up in your downline) all working to make you money while they make money for themselves?  It is for this very reason that so many MLM / affiliate programs spout up.

But the truth is that most of these programs will just cost you money and waste your valuable time.  Not all MLM programs are doomed to disappoint you but many will.  That is unless you know the elements of an outstanding affiliate / MLM business.  And that’s where I’m here to help you.  Once you grasp these elements you’ll quickly understand why these few programs do have excellent potential to make you money and you’ll be able to quickly pick out which of these are likely to be losers.

However, before we get to our list, take a look at yourself and your motives and expectations.  While you may have big dollar signs in your eyes after being approached with what seems to be a can’t fail chance to make millions, realize that a real business takes time to build.  You won’t make money overnight or even in a month.  And it’s certainly not going to be ‘margaritas on the beach’ if you want to make big money.  But if you are willing to work hard, you can make money and while you may not make money drinking exotic drinks on the beach, many of the best companies do have some very nice trips for top performers.  So there may be a free beach trip for you in the future.

Now let’s start at the top – you need to take a good hard look at the company first.  What do you need to look for?

1. Longevity.  How long has the company been around?  This is crucial because while you may be told that you are getting in on a ‘ground level’ opportunity with a new company, the truth is that you don’t know how legitimate they are, how financially sound they are and whether they may get into issues with product trademarks, lawsuits tied to product liability or a whole host of other issues.
2. Products.  This seems like a no brainer but it’s not.  Many of the MLM companies out there are one product opportunities.  I call these one trick ponies.  If you’ve been around for awhile you may remember the Sea Silver craze which generated tons of people wanting to sign up for this wonder liquid and sell it to their friends and then get them to sign up to distribute it to their friends.  Eventually the newness of the product wears off and/or product benefits end up proving unsubstantiated.  In fact the Sea Silver craze of a few years ago can be compared to the current crazes for Acai juice or Mangosteen juice.  Sooner of later, a new special drink will come on the market and the demand for these products will dwindle.  If your company is not talking about the next product they will introduce now, you’ll be left holding the bag.
3. Advertising.  Aside from providing you a steady stream of products, you nee to investigate how well a company advertises it’s product.  What you should expect is a nice media buy across different media outlets (TV, print, Internet).  A comprehensive and well orchestrated advertising program will create the desire for your product.  That makes your job selling the product much easier.
4. Inventory.  The best affiliate / MLM programs ask you to carry no or little inventory.   You may end up buying some products just to get more familiar with them but those purchases should be modest and made over time – not some huge package up front.
5. Comp Plan.  While most opportunities get pitched with the comp plan first, that’s the last thing you need to look at.  Do ensure that commissions from affiliate sales are reasonable (at least 10%) and that you feel you could make decent money just by selling products.  Any downline you develop will be something that builds over the future.

When you find an opportunity that meets all these criteria, don’t just sign up.  You see much of your success will be directly tied to your sponsor.