In existing economic practice network marketing, or as it still name, MLM (from «multilevel marketing») multilevel marketing-it rather new kind of advancement of the goods and services from the manufacturer to the consumer. Network marketing is based on direct sales, that is data of quantity of intermediate links between the manufacturer and the consumer and, accordingly, costs to a minimum. The manufacturer leaves on the consumer and offers it the production directly by means of the distributor. Network marketing makes a market by means of a communication of information from one person to other. The emphasis is done on qualitative service of the consumer and good relations with it. Historically this system goes back to economic practice to-industrial company when the manufacturer and the consumer did without intermediaries and the relation between them were more personal.
Occurrence of manufactory production and distribution system development have led to standardization of receptions of sale and, accordingly, too less attentive approach to the client. Network marketing is returning to simple, human relations, but already at new level, and allows realizing in practice idea of an individual approach to needs and requirements of the client. It is not simply convenient, but also it is necessary in our company where time became one of the most valuable and rare blessings. That is why in today’s economic conditions the organization working by a principle of network marketing, as a rule, prospers, and therefore the new kind of sales so has fast got accustomed in many countries of the world. Its mechanism continues to be improved.
In firms using a traditional way of sales, on marketing it is necessary to 80 % of expenses. All this money is spent for finishing of the goods or service to the end user. It is costs for studying of the markets, advertising, the contents of warehouses, transport, regular staff, a chain store system etc. Intermediaries-professionals lead up the goods to target markets thanks to the specialization, the contacts, experience, scope of activity. Intermediaries usually offer manufacturers the big profit, than they are capable to receive independently. For example, the company of General Motors sells cars with the help more than 10 thousand independent trading houses: even it is difficult enough to such large organization to find means to redeem all dealer enterprises.
Our industry lags behind from western a little, but also to Russia for ten years in network marketing has come more than 2,5 million persons. There were hundreds companies which have applied this business strategy. Now network marketing develops worldwide. Possibility to find independence and economic stability involves people more and more.
Independent activity became the powerful economic lever in the modern world. The created original micro-enterprises, people say that such kind of activity gives them a number of advantages, such as real material security, possibility of planning of time and more a life high level.
MLM used to be a hit, then a curse and now it is all about real things. It is about finding MLM business opportunity that works.
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