Home based businesses are probably the most popular new business venture of this century.According to Forbes Magazine 79 millions American are going to start their own business in the next 3 to 5 years and a very large percentage of them will be venturing into an home based internet business. On the other hand it also says that 97% of them will fail within the same period, this means that only 3% will succeed. Stats also shows that more than 90% of entrepreneurs operating an home based business spends most of the income produced by the business running the businessWhy are those stats so depressing yet people still can’t wait to start a new home based business?First people are dazzled by the ads and the possibility of making thousands of dollars. The classifieds ads in every new paper are full of ads showing how people are making fortunes running those businesses… the internet classifieds are also plastered with them.The ads makes it sound so easy to start a business and to produce income beyond anyone’s dream.
Unfortunately many of these are totally miss-leading and thousands of people are suckered in by them.
The fact of the matter is these statements are partially true, however they leave the most important fact out which is the person who did the fantastic income did it only once and it took him several years of trying different things.There is a very successful top earner who did a million dollar in one day; he himself will tell you it was purely by chance he has never been able to duplicate that performance; he had a unique product, at the right time, on the right web site and he had been at network marketing for years trying to make money.Secondly the other fact which the ads doesn’t tell you is: the total income was generated from an MLM platform (multi level marketing) that took years to build and he had thousands of people in his down line, One top earner actually used his down line he had built over the years with another company and introduce them to a new product and turn his contacts into thousands of sales overnight.As you can see most of the statements the ads are making partially true but cannot be replicate by someone like you or me starting out.We all know what MLM now stands for: make little money; unless you have a huge down line of followers you will not make big bucks.Traditionally MLM businesses do not pay large commission in dollar value, the ads may claim paying 50, 60 or up to 70% commission but 70% of $5.00 represents $3.50 you need to make a lot of sale to make $1,000 per hour. This percentages is often a combination of all the commission that can be collected from the different levels
Let look at it in dollars and cents if you had to pay to advertise your web site and the sale came from someone who click on it, chances are that ad probably cost you more then the $3.50 you made on the sale.For comparison purposes a banner ad use to cost $0.25 to $0.75 per CPM years ago now if you can find some around $2.50 to $3.00 per CPM your lucky and chances are the site doesn’t get much traffic. On a site with lot of traffic it an banner ad will cost you $10.00 to $15.00 per CPM so if you only get one sale per CPM that sale is costing you $10.00 to $15.00 and you only pocket $3.50. Not to long ago you could buy and ad word for a few pennies now you are looking at a few dollars for the same word, internet advertising is no longer a cheap media.When you are looking at an online business common sense has to prevail. It is costly to do business on the internet so don’t get excited with high percentages of commission look at the product, the possible demand for that product and the dollar value of commission, do quick calculation of how may sales you will need per day to make what the ad says.But you will argue there are all kind of free advertising available… yes that is true but there are also thousands of individual like yourself who is doing the same thing… you have heard the saying “best things in life are free” which is true but on the other hand there is a saying that says ” you pay for what you get” unfortunately free things are not worth much.If you are going to venture in an home based business stay away from an MLM business that claims you will be making thousands of dollars in a short period of time because the only people that do make money with these marketing strategies are the owner of the company not you the entrepreneur.
Make sure you follow the 7 steps in choosing a home based business. If you do not know check my blog postingsFinally learn how to successfully operate an online marketing business before you sign up, if you do not know where to get training I can help you with that.Pierre