Rise of MLM and Similar Models to Help Economy as Covid-19 Grounds Regular Business
The Covid-19 pandemic lockdown has brought the economy to a grinding halt. Traders cannot trade simply because production is at a halt and they cannot procure goods. Shops are ordered to remain shut. Only essential goods and services are permitted. Large and small businesses have simply shut shop and have dropped workers or put them on half pay and remote work mode. The economy of countries is in shambles and it will take a long time for normalcy to return. In this context the MLM model holds promise of helping to revive the economy.
What is MLM?
MLM or network marketing business model depends on roping in individuals to sell goods or services. Each individual who joins is tasked with roping in more individuals who, in turn, sign up people below them and so it goes on. Each one who sells earns a commission and those above him in the chain also earn a small percentage. This model is different from the usual manufacturer-wholesaler-distributor-retailer chain. Profits go to only a few whereas MLM spreads income across more people.
How MLM can help recover economy faster?
Many large companies have shut down operations. Travel and hospitality industry is at a standstill. Fears of infection will prevent people from travelling and distancing means that travel by flight or train will not be a viable option. Airlines are going into bankruptcy and sacking employees. What will such employees do to have a sustainable livelihood? The answer could be MLM.
MLM does not require substantial investments on the part of stake holders and participants. The strength is in numbers of people putting in efforts to sell and generate profits which are then spread across more people. The overheads are few since people mostly operate from homes and work in their local areas, which means travel costs are also low. MLM operators can reach out to more buyers with quality products at affordable prices as Amway has been doing since long. Those who were unemployed can look forward to an income and government has one less worry about generating employment.
It is not just person to person sales; MLM and similar models can even go online and reach out to more buyers. It is for the individual in the chain to think innovatively on how to sell more products to more people and also expand their networks so that they have income from their direct efforts and through efforts of others. As business thrives government earns through taxes and more spending and the economy revives faster.