A short thought about network marketing / recommendation marketing

Many people associate network marketing with the idea that many people earn money and that the products actually have to cost much less. At the same time, however, prices in retail and online trade are usually more or less accepted. Some people also like to buy products with which “fair” trade etc. stands.

Rarely one or more thoughts are wasted then actually once on it like the costs in the retail trade look and which the producer actually receives. If you can see the show “Dragons’ Den” from time to time, you might want to think about this cost – selling price situation, because as soon as a candidate says that his product costs 20% of the final selling price, the interest of these “dragons” disappears suddenly.

I can only list one product here as an example where I was completely involved from production to sale.

I now bridle the horse from behind.

1 kg paprika costs up to 5.99 euros at REWE.

But I’ll only take 4.99 euros now.

REWE sometimes buys this from the middleman in Europe for 1 euro, on average 1.50 euro.

Of course REWE has to pay for advertising, buildings, employees, etc. and above all shareholders.

The middleman (who of course has costs and wants to make a profit) buys the kilo from the local middleman (in this case Morocco) for about 1,00 Euro. The local dealer also has a heap of costs (transport costs of approx. 5000,- for a normal truck with 12000 kg, that is 40 cents per kilo). In addition the packing and labeling costs of approx. 10 cent come, etc.) Of course also the middleman would like to earn something locally and buys thus the commodity for 40 cent per kilo from the producer.

Thus the producer has approx. 7% of the selling price at REWE. (That’s a nice calculation, there are often enough times when the producer gets 25 cent/kg)

But we think this is normal and ok.

In network marketing the goods are recommended from person to person and the different structures deserve to have established these contacts. All costs for advertising, advertising material, websites, etc. get “stuck” with these people.

As a rule, about 5 to 10 levels are paid, in addition there are, depending on the distribution, different bonuses.

If we assume a bonus system with 10 levels from 1% to 10% are without bonuses 55%, then we are sometimes nice and add 20% more bonuses, but then the producer 25% “hangs”. Isn’t that fairer? If we assume that the producer naturally has higher costs for storage and logistics due to this system, then it is still well over 15% that remain with the producer. In this respect, the network marketing system is certainly fairer and people who work for it earn money with it.

Now the only thing that matters is that the products are in order!

Also here the viewer often loses sight of what nonsense and useless stuff he often buys in the retail trade.

Of course, there are also bad products in network marketing, but as a rule they do not stay on the market for long, because it is difficult to recommend bad products in the long run.

The bottom line for me is that network marketing with good products is fairer than retailing, that more people are rewarded for their work and not money is earned with money and it improves communication between people, because it has to be talked about and not just consumed.

These thoughts have moved us to do network marketing with Kannaway’s fantastic products, with a clear conscience and full of enthusiasm.

 

You can find high-quality products in my shop (forwarding):

The shop of Juttakann

Jutta Ferchow

Stefan Lueke