MLM is a way of organizing people who buy a product. Network marketing has created many millionaires who would never have been rich otherwise. So why have you never made money?

Here's the way network marketing works:

You buy product from a company at below retail cost. You get the discount because you're making the purchase directly from the company; no middleman or advertising costs are involved.

You also become a member of the company's network of customers. You help spread the word and build a group of other customers. You earn a profit from your direct sales, plus a percentage of the sales of other customers in your group. As your group grows, your income increases, because there are people working under you and you're also earning profits from their sales.

Beware of a pay plan in which no product is received for a purchase. And avoid a plan where someone else gets paid on your sales before you do.

Talk only to the RIGHT people

Imagine you're walking past a hospital and a doctor meets you on the sidewalk. He hands you a scalpel and invites you inside to perform an appendectomy. "I can't," you say. "I don't have any medical training." "No problem," the doctor says. "Anybody can do it."

Think you would botch it?

Unfortunately, this is what happens most of the time in network marketing. People tell you how easy it is, but remember, MLM is a business. Something must be sold to make a profit, yet people are telling you there's no selling involved.

No sales equals no profits. And no commissions either.

To make money in MLM, you must refer paying customers who refer others. To do this, only talk to people who understand and know what's required. The key is to spend as little time as possible with the WRONG people, and as much time as possible with the RIGHT people.

You must qualify people for your time and effort.

There are only so many hours you can spend working a part-time business. Even if you could work 100 hours a week, that's all it would be. But if you can build a group of 500 customers who work 1 hour a week each, that's a 500 hour work week on your behalf.

The key is identifying those workers yourself and showing others how to find them.