One of the afterthoughts in the MLM and Party Plan order entry critical path, daily settlement systems done well make headaches go away.  Activities in the daily settlement process presuppose the following conditions exist in your company daily operations:

• Reps are being entered into the system (by employees and/or online by distributors)
• Inventory is established and kept up-to-date
• Orders are being placed and payments are processed and collected
• Ship verification is consistently updated

Daily transactions are like soupy concrete with all of its ingredients, blended throughout the day in a mixer.  Ingredients include distributor accounts, orders, payments, pick & pack, shipping, and all real-time elements throughout the day.  The blend sets up like concrete once it goes through the end-of-day settlement processes.  The settlement processes make the transactions permanent.

This daily settlement processes focus on the following essential tasks:

• Pre-settlement processes
• Running settlement
• Post-settlement processes

Settlement primarily consists of depositing cash receipts, updating organizational volume, and posting transactions to the account credits and accounts receivable ledgers.  These steps are automatic when running settlement.  The pre-settlement and post-settlement processes require close attention to ensure accurate results.

Before proceeding, the following staff functions must be trained and closely involved with the processes:

• System Administrator (Process Manager & Computer System Administrator)*
• Order Entry Manager
• Distributor Service Manager
• Warehouse / Shipping Manager

We also recognize the reality of one person wearing multiple hats, and we encourage not only a good night’s sleep, indefatigable sense of humor, and a good support network, but also a commitment to creating and documenting processes so that someone can easily pick up any of the routine tasks once they become unwieldy for the operations superstar.

*System Administrator – This term can have various meanings, but in the context of this business process guide it has a specific meaning.  It refers to an individual responsible for detecting problems that may hold up online processing (such as unposted orders or shipments that have not been verified) and overseeing the flow of the daily critical path for orders and transactions.  This person acts as manager of process flows within the company.  They are accountable to and/or part of the key management circle.

This quick introduction to the daily settlement process is what we use as MLM consultants, intended to frame a context and set expectations for proper implementation.

In MLM and Party Plan companies, picking and packing orders is the vital link between order entry and processing on the front-end of the critical path, and the arrival of the package at the doorstep.

Accurately picking and verifying orders and shipments is the essence of successful order fulfillment in direct selling companies.

Knowing about the process of shipping rests on accurate account setup, accurate inventory setup and management, and accurate entry and processing of orders.  The result is well worth the effort: happy employees and happy reps.

More and more, I see claims from emerging authors and MLM consultants that they “wrote the book” on Direct Selling.  Makes me scratch my head.

There are some good writings on aspects of MLM and Home Party Plan business.  In the aggregate, however, they still are only fragments of a great body of work that has yet to be created.  The Book on MLM is being researched by a few thousand companies who are actually doing it, learning what works and what doesn’t work.  MLM and Home Party Plan comprise “direct selling” (in our way of referring to it), and they are largely social experiments that are working!

All good things have an evil twin.  If you’ve heard the negative about illegal pyramids and MLM scams, the pull the string and you’ll find on the other end of the spectrum are glorious, vibrant companies doing good.  Products that have a story to tell can make their way instantly into the marketplace if someone will tell that story.  That’ the essence of direct selling – paying people to sell your products by telling the story.  And the growing collection of those stories is truly the “book of direct selling,” or the definitive works comprising the Book of MLM and the Book of Home Party Plan.

Ask the MLM Experts: What is the key to choosing the right MLM software or party plan software?

Terrel Transtrum, Leading MLM Consultant: I asked Dan Jensen, founder of Jenkon Software and the award-winning MLM compensation plan consultant.  He said, “THE MOST important issue for a party plan company is the party order entry system.  No matter how good the rest of the system is, if the party order entry doesn’t impress the thousands of consultants using it every time they do a party, then all is lost.”

Says Dan, “don’t buy based on ‘eye candy’ – how sexy it looks.  While that’s important, it’s something that can be improved.”  But the cornerstone in choosing party plan software is how you get a party into the system.  If that is user friendly, efficient, fast, intuitive, etc., then it will likely go over well with the field.  BIG issue.”

The key to choosing party plan software is the party order entry system.

Question: Will you explain the difference between MLM and Party Plan?  I think that MLM is the same as Network Marketing, but are these different from direct selling?  And how do I know which is best for our startup?

Answer: “Direct selling” is the generally accepted term the selling system that moves products and services directly from a company to its users and consumers.  The selling is performed by the independent representatives of the company.  Worldwide, companies sell an estimated $118 billion in goods and services through this massive distribution system of person-to-person marketing and sales, with as much as $28 billion of that in the United States.  (Sources: Direct Selling Association, www.dsa.org, and the World Federation of Direct Selling Associations, www.wfdsa.org)

Some MLM Consultants teach that there are three methods of person-to-person selling:

1. Direct Selling
2. Party-Plan Selling
3. MLM or Multi-level Marketing

The LaunchSmart MLM consulting team suggests a subtle distinction, which is that direct selling is the umbrella under which two methods of selling reside: MLM and Party Plan.  Direct selling is a generic reference to the movement of goods and services directly from company to consumer, where sales commissions are associated with the sales efforts of the company’s independent sales force.  Party-plan sales commissions are generated through group selling, often with retail commissions plus incentives for gathering a group together.  Party-plan compensation leverages a one-to-many sales presentation.

MLM compensation plans pay commissions for personal sales, accumulating commissions and bonuses on sales that are related through sponsoring lines.  Both MLM and Party Plan methods link individual sponsors and business builders, often paying compensation through, and/or as a result of, these connected lines.  These methods are sound and very legal since compensation is tied only to the sale of products and services, and not to the act of sponsoring someone.

Advantages that are common to MLM compensation plans and Home Party Plan compensation include the following:

• Sales representatives need not stock products other than those used for demonstration or samples
• The company ships directly to the distributor or customer who makes the purchase
• MLM presentations and Home Party Plan demonstrations are ideal for presenting products that require explanation
• MLM compensation plans, like Party Plan compensation plans, pay for sales personally produced, with commissions and overrides paid to those who train and manage individuals and groups in their sales organizations
• Distribution channels, once established, are the marketing channels through which information, goods, and services are moved
• Part-time to full-time selling, with incentives for immediate action, are characteristic of successful MLM compensation plans and Home Party Plan compensation systems

Through MLM (multi-level marketing, network marketing, viral marketing, referral marketing, etc.) the direct-selling process is duplicated by independent sales reps who sponsor and train others.  Through this basic system of selling, on which virtually all sales systems are based (from insurance to real estate, and from automobiles to men’s clothing) multiple levels of commissions are earned, paid directly from the company to the sellers, managers, and leaders.  This basic concept applies in both the MLM and Home Party Plan selling models.

For a Free MLM Consultation or Free Party Plan Consultation, contact the MLM Consultants at LaunchSmart.  We want you to succeed, since your success is our success.

Historians say that more millionaires were created during the great depression than in any other point in history.

I’m amazed by the number of entrepreneurs and dreamers who are coming forward in our down times to launch new business.  Somebody forgot to tell them that times are tough!

These are the women and men embracing the American dream.  They have the courage to dream, the discipline to think, and the backbone to act.  So far this week we have served more than ten individuals and companies who are up to their elbows in starting and running their MLM companies and Home Party Plan businesses.  Ranging from eLease who is placing the first round of test market assumptions to their idea of expansion through direct selling, to Endless Glow – a home party company providing airbrush tanning services and products by two lovely sisters who aren’t aware that there is a recession.

Somebody forgot to tell them.

By David M Taylor, Co-Founder of LaunchSmart

We all remember the great childhood story about the little engine of the train that said: “I think I can, I think I can, I think I can . . . . “  Well, in the wonderful model of direct selling we call party plan – there is an amazing little engine that drives that business, and therefore drives the long-term, sustainable growth of a party plan company.  Understanding that engine, and all the personal motivations involved, is critical to success using the party plan model.

The little engine gets started right after a new party plan consultant (independent field sales representative) enrolls.  As soon as possible after enrollment, she needs to do her “grand opening party” – usually with the support and supervision of her sponsor (the person who enrolled her).  The grand opening party fills the little party plan engine with its first tank of gas!

A new consultant’s grand opening party will usually be held at her home, and she will invite all of her close friends and relatives to come and support her as she kicks off her brand new home based business.  Usually she will get a good turnout at this party, because her close friends and family want to support her.  But what is vital is that she has to get as many bookings for additional parties as she possibly can before those guests leave her grand opening party.  Why?  Because, here are the key elements that drive the little party plan engine:

1. A full calendar means a full bank account for the party plan consultant.  An empty calendar means she’s out of business.
2. The goal is to get at least two bookings from every party.  That’s what keeps the calendar full!
3. The goal is to get at least one follow-up phone interview per party with an attendee who is interested in starting her own party plan business.   That’s what builds her team and exponentially increases her income!

Now, to get the guests at the grand opening to book their own parties, there are three essential ingredients.  Of course, attendees have to fall in love with the product.  Second, there has to be an enticing hostess reward program in place that is communicated to all attendees.  And third, the new consultant has to be taught how to invite attendees to book their own parties.

Next, let’s fast forward a couple of weeks.  The new consultant is now doing the parties she booked at her grand opening.  Again, what’s her goal?  Simple – two bookings and one prospective new consultant from each party.  To make that happen, again there are several key ingredients.

Of course, attendees have to fall in love with the product.  Second, there has to be an enticing hostess reward program in place and the consultant must make it very public to all guests how the hostess will benefit that night from the guests’ purchases.  Understanding the hostess reward program helps them feel a motivation to purchase because they know the hostess and want to help her get some great rewards that night.  In addition, understanding the hostess reward program makes them want to have their own party.  It’s great if the hostess reward program has a booking incentive – something that rewards both the hostess and the guest who books at her party with small rewards.  The consultant will need to learn to effectively use “booking seeds” – comments she drops here and there to inform, educate, and invite guests to book their own parties.  If she books two parties from her grand opening, and two parties from each of those parties, and two parties from each of those parties, and so forth – she will soon have too many parties.  Great!  Now she’ll be even more motivated to invite a new consultant to enroll under her, help that new consultant with her grand opening party, and give that new consultant a couple of her own bookings to help her get started.  Of course, where is the best place to identify and invite new consultants to come on board?  At her parties!  And the hostesses are some of the very best prospects.  Again, she will need to learn to effectively use “recruiting seeds” – comments she drops here and there to inform, educate, and invite guests to visit with her about starting their own party plan home based business.

So, there it is – the amazing little engine that drives this business model we call party plan.  Get some gas in its tank, get all party plan consultants following the formula and teaching those they recruit to follow the formula – and this little engine will build a great big company!

Of the MLM distributors, Party Plan consultants, and their customers lost each year, statistics say that more than half are lost in the first 13 weeks following enrollment. Fast-start success of each MLM distributor or Party Plan consultant virtually guarantees the long-term success of your company. Thus, it is entirely appropriate that a fast start plan for distributors and consultants begin by examining your company’s fast start system.  “Fast start system” refers to the crucial period that begins immediately upon a distributor’s or consultant’s sign-up and continues through the first 13 weeks (90 days) following sign-up.

The powerful emotion behind a person’s decision to join your company will rapidly diminish unless the decision takes root. A customer must quickly experience fast delivery and promised benefits of a product or service that you are selling.  An MLM distributor or Party Plan consultant must experience a measure of success that will reaffirm belief in your company and in his or her ability to attain their goals.  In fact, the emotional “juice” that moves a person to action will diminish or completely dissipate upon occurrence of one or more of the following:

• The new recruit’s decision is questioned or challenged at home or by well meaning (but uninformed) friends or family

• The new recruit encounters a negative response when they share their newly found product and/or business opportunity

• The new recruit fumbles or procrastinates the important first steps in getting started; or worse, they don’t know where to start

• Time passes without sufficient reinforcement of the belief

• Expectations are not realistic or are not managed through the establishment of goals followed by adequate planning and action

Your fast start success system, correctly designed and effectively deployed, is the critical business building activity that will give new recruits the best chance at succeeding with your company.