Building residual income from your Network Marketing business.

One of the results of using the approaches and ideas of the New Paradigm Network Marketing is that you’ll build residual income. I know people always talk about this as one of the big benefits of Network Marketing, but if people where actually achieving this, why would there be such a high dropout rate?

Traditionally, somewhere between 95% and 99% of people who join a Network Marketing business will drop out. That means out of every hundred people who join your team, somewhere between 95 and 99 of them will leave.

That's 95 to 99 people who’ve spent time and money building their dreams and getting some hope, just to lose it again. If those people are no longer in your downline, this isn’t going to contribute to your residual income either.

By changing what you do and where you're focus, this dropout rate can reduce to about 33%. It will never reach zero! Life happens to people and we’re all entitled to change our minds. It's also possible that some people in your team will keep 95% of the people that they sign up. So I’m only giving an average figure.

Like everything on this website, please check it out yourself. Look at your own printout. How many people joined your team in the last year? How much has your downline grown in the last year? Was it far fewer than the number you brought in? Remember, this is the dropout rate for just one year. If you looked at the people who joined five years ago, how many are still there? For more information on these numbers, please read Focus on the Right Network Marketing Statistics and watch your team grow.

Why focus on retention in your Network Marketing business?

Firstly, when people leave your downline, usually they're no longer using the products or services of your company, so you earn nothing. Secondly, they're not introducing new customers and business builders to your team so you lose out on potential residual income as well.

The ‘salesperson type’ who can recruit tens or even hundreds of people can afford to have people dropout because they can replace them easily. However, the ordinary person who is too uncomfortable using the salesperson approach, will usually struggle to build a team.

What usually happens, in reality, is that most ordinary people eventually drop out. It's only a minority who are lucky enough to recruit a productive person that sticks around. You can confirm this by looking at the statistics from many companies and network marketers. Most network marketers who are making a living from building a business, have usually recruited no more than one significant person.

As I already mentioned, residual income from your Network Marketing business is a result of the New Paradigm rather than focus.

By helping a handful of people you’ve personally introduced to get what they want, you’ll get the residual income that you want.

By helping them become independent business people, they will happily work in your business long after you finish working in it. This is true residual income when there’s no need to come back and keep rebuilding your Network Marketing business.