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Article A Networking Population
Explosion If you're in network
marketing, there's good news, and there's bad news - and the great news
is that, for you, they're both good news.
The global economy is cracking apart worldwide. Russia is suffering
continuous political and economic crisis. The Asian nations, including
the financial powerhouse that was Japan, are still shaky. Meanwhile, in
the U.S., no signs point to a recession - yet. Hasn't this always been
the case toward the end of a boom in the financial cycle?
Worldwide, people are beginning to worry. Once they start worrying,
they quit spending money. This "psychology of fear" fuels a recession.
I'm not saying there is going to be a depression, which is much worse
than a recession. What I am predicting, based on surveys conducted by
our company (which have proved exceedingly accurate over the past 10
years), is higher unemployment and underemployment - people forced to
work for less money than their qualifications would warrant.
Our Countercyclical
Business
General economic theory holds that there tends to be a recession
about every eight years. The entire history of the modern United States
reflects this boom-and-bust cycle. Consistently, network marketing has
grown during the "down" periods.
The oldest network marketing company we can track is the
marine-vegetable (seaweed) supplement company Wachter's, which started
in 1937 near the bottom of the Great Depression. Nutrilite took off in
1945 during the economic decline immediately following World War II.
Shaklee and Neolife fared well in the post-Korean War slump. Amway got a
good start building with the slump in 1958. Mary Kay started with the
downturn in the 1960s. This theory held true in 1992 when Alliance,
Kaire, Life Plus, and a number of other companies started up and entered
their own boom period.
When recession hits, those with any intelligence are going to
scramble to find alternative sources of income. In their frantic
searches, they are going to find that the best of all alternatives is
network marketing.
In the graph, we show the increase in growth of several major network
marketing companies operating during the recession of 1973-75. You will
note that the companies were not doing badly when the recession started.
They had a fair amount of growth. However, when the recession came, they
took off like rockets!
Even after the recession, their growth rates remained higher than
they were before the recession. This was probably due to two reasons.
First, the memory of the recession lingered in people's minds. Second,
there was now a larger distributor base, recruiting more new people.
Another factor that will fuel the growth in network marketing is that
many Baby Boomers have put their life savings into the stock market.
With the market's recent upward spiral, many Baby Boomers have resumed
their high-flying, fast-spending ways and have meager savings except for
stocks. With the inevitable, cyclical decline of the stock market, they
will see their retirement plan funds lose 25 to 50 percent in value.
Panic will follow. Baby Boomers with sense will be looking for secondary
ways to build a residual retirement income.
Now is the best time to grow your network marketing business. Whether
you are a veteran or a beginning network marketer, the future is bright.
Soon consumers will be looking for the best quality at the best prices.
Where do they find it? Often in the quality products offered by network
marketing companies.
Recession causes people to open their minds to gaining alternative
sources of income. If they are still employed, they are worrying about
the possibility of losing their jobs or having them downgraded. If they
are unemployed, they are seeking ways to build their income without
spending large amounts of money to start another business.
Network marketing is the ultimate "recession-proofing" for your
economic life. « Previous
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State of
the Industry
article from the
April / May
2000
Issue
Next Article »
Other
State of the
Industry
article(s):
The Four Greatest Fears of
Starting Your Own Business
The Academy of Network
Marketing?
The Code of the
Business
Your Time Is
Now
The Village is
Back
Hot Times Ahead
WHEN RECESSION
HITS THE ECONOMY, NETWORK MARKETING BOOMS
By ROD
COOK
In good economic times, people are less interested in career
alternatives, but they can more easily afford to buy more consumer
goods. In bad times, they crave new business opportunities. Today, we
could soon be facing global recession - and tremendous worldwide
opportunities for you.
Understanding the
relationship between low-cost entrepreneurship and economics is
important. During the past few years, the world economic boom has made
people complacent. In the U.S., the jobless rate dropped to all-time
lows of less than five percent. People had to be sick, lame, or lazy not
to get a job. Hamburger flippers got higher-paying jobs, such as
assembling computers, and their incomes rose. Rather than looking for an
alternative to a job or seeking extra income, these folks sat around and
watched television.
When recession hits, those with
any intelligence are going to scramble to find alternative sources
of income. In their frantic searches, they are going to find that
the best of all alternatives is network
marketing. 
Grab your hat and prepare for the next boom in network
marketing. If you are a newcomer, study the industry closely (and
quickly). If you are an old-timer, get out your contact lists for the
last two or three years. In a recession, they will be solid gold! All
you have to do is get out there and help people out of their economic
duress.
More on ROD
COOK
NML
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