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New Business Startups - The Last Resort of the Little Guy

Darryl Van Kirk
 


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What is the last resort of the little guy? It's certainly not a traditional storefront or franchise business.

In today's economic climate many businesses are merging and consolidating. The weaker players are going out of business or being absorbed by their competitors. This is happening across the nation. We are seeing strip centers with 50% occupancy due to business failures.

In addition to the costs of building rents, advertising, fixtures and employees, we are entering into an era of increased taxation and regulation. Compliance with many of the obstacles in the way of a startup are just too much for many to overcome without large amounts of capital. In this climate the costs of starting a new business are, in most cases, out of reach for the average American.

What is the last resort of the little guy? At present these programs are called network marketing, MLM, affiliate, cooperative marketing and word of mouth marketing. All of these models work in a similar fashion. A manufacturer knowing the huge burden of competing in the national or worldwide marketplace chooses to share the wealth in exchange for the sales team carrying on the promotional side of the business.

Some of the more sophisticated companies are even going so far as to have a shared or cooperative marketing program. In this arrangement the company may have an advertising program over the radio or TV with infomercials and either have the distributors or affiliates contribute to the campaign for a share of the customers or set a price and actually sell the rights to a customer for life to the affiliate.

In any case, the startup costs are minor, in comparison to buying a franchise or a traditional business startup. The average person can fund the 500 to 1,500 dollar startup costs through savings or by taking a part-time job to raise the capital.

The expertise needed for success can come through a company training program or through the new distributor or affiliate's connection to the company, also know as, an upline or sponsor. Usually if their sponsor's are new to the business, that training and leadership will come from another above their sponsor who has a vested interest in the success of the new affiliate. This is due to the fact that even many of these affiliate programs pay on multiple levels or tiers of recruits and in many cases, have a leadership bonus program to promote successful team building.

Much of the recruiting training is accomplished through webinars, internet videos, internet audio's and conference calls, making traveling to a classroom setting obsolete for these new entrepreneurs.

All the income paid to the affiliates or the sales force is based upon products or services sold. The companies have very little customer acquisition costs allowing them to put their profits into research and development, improving the products or services or developing new ones.

The new distributors or affiliates are able to market nationwide or worldwide due to lower cost and improved communications. Sitting in their home office in Kansas, today's entrepreneurs can have teams in New York, California, Florida and elsewhere without leaving their homes. Social networking and the internet have removed the obstacles of travel from the sales equation for the wired affiliates and distributors of today.

In summation the reason these programs have become the last resort of the little guy are:

  • Low startup and daily operation costs.
  • Startup expertise is provided by the company or upline mentor at no or little charge.
  • Internet access and marketing costs are much lower than the old models of driving or flying to new markets.
  • Training is accomplished over the internet allowing new information to be rapidly shared.

    Darryl Van Kirk has been self employed the majority of his life and working from home 9 of the last 10 years. One of his current businesses is: AffordableBenefitPlan.com He is also involved in other home based business ventures.

    Come check me out At AdlandPro .

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