Over the years, we have identified patterns to the start-up budgets for MLM startups and Party Plan startups. The patterns roll into ranges, included below. Keep in mind that there are hosts of variables to consider, moving budgets up and down, and there are hosts of approaches depending on the MLM consultant that you choose to work with and to learn from.
The secret to successful budgeting always comes back to excellent strategic planning, careful and thoughtful resource management, and a clear understanding that business is not an exact science—therefore you will want to build in cushions and reserves for unknowns.
Perhaps the biggest unknown is speed of growth, taxing the limits on merchant accounts, inventories, and infrastructure. It’s true that one of the top causes of failure in MLM startups is insufficient operating capital. The top MLM consultants will tell you that too often, an entrepreneur believes—and usually with good reason—that fast growth will attract capital and simplify its acquisition. In fact, it takes time, and the time to plan for it is from the beginning.
So, here are some ranges to use as starting points for planning. We have observed these ranges from MLM consultants, MLM lawyers, MLM software providers, MLM compensation plan designers and other MLM service providers, over the course of more than 20 years:
- Primary MLM Consultant $ 2,500 to $ 100,000
- MLM Legal $ 3,500 to $ 55,000
- MLM Compensation Plan Design $ 5,500 to $ 27,000
- MLM Software / Party Plan Software $ 10,000 to $ 250,000
- Marketing, Design, Sales Tools $ 5,500 to $ 85,000
- International Launch Support $ 12,500 to $ 150,000
- Opening Product Inventories $ 0 to $1 million
- Operating Lines of Credit / Cash $ 0 to $25 million