If you are reading this, then your Multilevel Marketing (MLM) business is at a stage where it is flourishing right now! As you’re noticing this growth, you’re probably wondering, “Should I register my MLM?” The answer is YES if you own a company.
Registering your MLM has some great benefits, and it is a hassle-free process if you have done your homework right. Read on to learn more about these benefits and how you can prepare to register your MLM.
You do not know about MLM and if you have landed on this blog, give it a read. If you want to learn more about MLM and plan on establishing a business out of it with no MLM account, then check out this blog about why it might be a good option for you.
Also known as direct marketing, referral, or network marketing, MLM has become increasingly popular despite being a controversial subject in the marketing field. Its popularity is that it allows earning extra or passive income while still balancing work and family life. Check out some of the most popular MLM businesses in Canada!
What is MLM?
Multilevel Marketing is a sale and marketing strategy adopted by some companies to rev up their sales. The marketing design allows the already hired distributors to employ more individuals as salespersons. While the existing distributors get a percentage of the sales made by their newly recruited team, they are also dealing with direct sale deals at their end.
In this way, multiple downlines are created where everybody is making an earning. It thereby creates a ripple effect on the overall profits and sales of the parent company.
Why MLM draws a debate? The reason is the working of its module, which we call ‘Pyramid marketing.’ This partnership selling is sometimes called networking marketing, and it involves paying the sellers at the top out of young recruits’ sales.
The sellers at the top do not put in effort regarding sales and marketing but are involved in hiring new faces. This way, they keep on getting paid without any work done.
Such marketing tactics are identifiable because their whole focus remains to employ new sales representatives rather than actual product sales. If a company or a company’s representative sells its products directly to consumers, it is legit MLM. If they try to sell the product to its members, who, in turn, recruit new members to buy the products, it is the pyramid type.
So if you are starting an MLM business for your own company or trying to get integrated into one dealing with MLM, be wary of the pyramid structure.
Becoming an independent entrepreneur for a multilevel marketing company is a legit and viable option for many who want to add to their incomes or seek higher business positions. MLM provides a market-endorsed proven product, a marketing plan, training and mentorship, and its support. Call it a wrapped business present that supplies all-you-need in one deal to get you started.
But it does not mean that it will run its course passively.
Yet, you must understand that many myths are surrounding the legitimacy of MLM. Big money is rare in MLM for runner-ups, but it does bring home legit reimbursements with continuing efforts.
Choosing the right product or company is the first step on the road to success in MLM. If you have the knack to find new customers and build a potential business community database, you can achieve what many may fail to grasp.
Recommended: How to Start an Online Business in Canada
Why Should I Register My MLM?
Registering your MLM will help you reap benefits that are both short and long-term. First of all, registering will protect you from getting into trouble with the Canada Revenue Agency (CRA).
Then it will also minimize your tax and personal liability. Registering your MLM company will help build brand awareness for your product line and bring you many more profitable opportunities by shaping reputation in the marketing community. You can sell off your business if required if you are a registered MLM Company.
Registering your MLM will give you some greater responsibilities than you’ve previously had. Here’s what you need to do to get ready to register your business and how to easily navigate your bookkeeping and all once you have registered.
How Do I Get Ready to Register My MLM?
Whether you are designing an MLM home-based business or starting an MLM company, doing your homework on how to start a multilevel marketing company would save you from many stresses in the future.
1. Set Up Your Office Space
If you have been operating your MLM online, then you must be working from your home. While staying home and working, like in the COVID-19 situation, maybe safe and convenient, it can sometimes be dull and boring. Some may find it challenging to stay motivated and organized.
If you have an office space in your home, make sure you invest in a suitable desk and chair. Try to decorate your area so that you look forward to going into your office every morning! A well-lit, organized, and neat office or workspace keeps the morale high.
Suppose you do not have an office space and work from your kitchen; that is okay too! Try to keep your work area as separate from your living space as possible, and keep your supplies organized. We recommend getting some office gadgets that help you put away your work papers and all tidily and effortlessly, such as a file holder, file cabinet, etc.
2. Organize Your Paperwork
As regards business filing, Define yourself as being a paper person or if you prefer to keep all of your documents as digital format. If you are a paper person, you’ll want to adopt a good filing system and stick with it, which could be a filing drawer that you organize monthly or quarterly. If you prefer to have a paperless filing system, take photos of your receipts and documents, save them on a hard drive, or use an app like Hubdoc.
Tracking your business mileage is just as important as keeping your business expense receipts! Click here to download our free Mileage Log. You can use this on your phone, or print it off and keep it in your car. Be sure to include this log in your filing system.
Having your receipts and business documents organized and easily-accessible will be a big help when you register your business and when tax season comes.
3. Choose a Name For Your Business
When you register your business, you will need to register it under a business name. Naming your business is a big task. We recommend choosing a name that clearly represents what you do, and it is easy for people to read/pronounce. If you register your business as a corporation, you can also name your business with a number, or you may want to learn how to incorporate an LLC … but more on that later!
Choosing a name for your business does not have to be stressful. CorePro8 can guide you through the steps to starting a business, including best practices for choosing a business name or number. Learn more about CorePro8 here.
4. Determine Your Main Office Location
When you register your business, you will need to determine the province/territory from where you are operating. You must identify the exact location of your office. If you plan to continue working out of your home address, this would be considered your main office.
5. Decide How You Will Register Your MLM Business
Deciding whether to register as a sole proprietor or a corporation can be complicated if you don’t understand what they are how they differ. If you want to know more, check out our video on the difference between sole proprietorship and corporation.
Let CorePro8 Guide You
CorePro8 is the one-stop-shop to set up your MLM business correctly. It guides you step by step to start a company beginning with all the details you need to register. It also gives you advice on bookkeeping, taxes, and how to pay yourself. No need to search the internet for information on each step; CorePro8 has everything you need to set up your business. Learn more about CorePro8 here.
You are killing it with your MLM, and you love what you do each day. CorePro8 will help you organize your business essentials and make registering your business a stress-free process so you can focus on what you enjoy.
6. Pick your Niche/Product
This is one of the common steps for not only MLM but for any company. Finding the suitable niche for your network is the initial step. Spend your time in finding and identifying relevant products and services. Nutritional network marketing is one of the popular niche of MLM.
Keep your eyes peel and look for a unique idea or have a contraster from similar offering. Try to aim for the products you can price with 5X margin. If you achieve 5X margin it’ll be assured that you have enough to launch your product in the market.
In MLM there’s a compliance consideration. If your customers has a strong demand for your products and services it will ensure that representative sales will be successful. This will also ensure that your MLM Company will be generating profits from retail sales to consumers.
7. Price Structure
Keep the supplier’s recommendations in mind and set the retail price of your products. On several different levels, establish a commission structure for your distributors. For example set the commission at 10 percent for first level sales where the distributors earn off those people they recruit. Allow the distributors to earn commission off people your distributors recruit.
8. Secure Funding
In MLM when it comes to funding you’re going to have options. One of the common option is debt-financing which include interest-bearing loan from the bank. Equity financing is another option massively used by MLM Companies.
In equity financing the owner sells the ownership in the company in exchange for cash. It can come from different sources such as, friends, family, initial public offering (IPO) or investors. There is no obligations for repayment in equity financing.
You can use both options like other MLM Companies according to your need, expansion initiative and cash flow.
Advertising is the key to generate your company’s profit. Magazines like “Small Business Opportunities” “Home Business” etc. gives a highly needed boost to companies in need. The most cost effective of all ads is classified ads.
Create a website and include it in classified ads. People can join your market level opportunity. For accepting credit cards online make a merchant account through your bank. If you are unable to create your own website then hire a web developer. You can make self-replicating websites as well, the difference is it will have the same address or URL as your site but with unique identification number or unique extension.
Let CorePro8 Guide You
CorePro8 is the one stop shop to set up your MLM business correctly. It guides you step by step on how to start a business beginning with all the details you need to register. It also gives you advice on bookkeeping, taxes, and how to pay yourself. No need to search the internet for information on each step, CorePro8 has everything you need to set up your business. Learn more about CorePro8 here.
You’re killing it with your MLM and you love what you do each day. CorePro8 will help you organize your business essentials and make registering your business a stress-free process so you can focus on what you enjoy.