The most profitable online businesses are the top tier programs that require some entrepreneurial courage and investment but allow you to earn a significant upfront income.
Most people have the idea that the economic crisis experienced these last couple of years was the worst time ever. But in actual fact, it has been the very best time to establish a home business.
There are so many home business opportunities and schemes to make money online. Yet, it is clear that many are just a scam. It is vital then that you know what constitutes a profitable business model for you.
with the ever-increasing number of both legitimate opportunities and rip-off scams, how do you know what is a honest AND profitable online business to start up and how do you know who to believe when you are researching what is out there?
I had exactly this dilemma. I tried all kinds of schemes and trainings and tools and systems before finally finding success. Now don’t get me wrong, I learned LOTS from my past attempts at a home based business, acquired many new skills. None of it was wasted. But I also wasted LOTS – lots of time and lots of money.
Sound familiar?
This is the reason I put this article together to try to explain some of the different home business models. There are so many variables both in the business you choose and in what YOU need to bring to it. I was doing all the right things but in the wrong way and with the WRONG business model.
The penny dropped when I was on the phone with a friend from that previous MLM. I saw him go from flat broke living in his mother’s basement to become a top producer earning over $50K every month. You see, he’d found a system that works. And after just a few months, I’m on track to follow exactly in his footsteps.
Once I discovered a highly profitable business model that suits what I want to achieve, I simply applied my knowledge and skills and could be successful. The ‘system’ is simply this: a highly profitable online business model. It offers top quality internet marketing education on the front end combined with a top tier product on the back end.
Let me explain some of the terms and the different kinds of home businesses you can start.
Brick and mortar businesses
This is where you buy or let premises for the purpose of selling products or services. This may be you use part of your home or outbuildings. Examples are a personal trainers, hairdressers, dog grooming, computer repairs. The capital you need to start up will be generally high and it may take several years before you are in profit.
Franchise business
Similar to traditional brick and mortar business, but with this model you are buying into a known-brand and premises. Examples are restaurants, cleaning companies. The business is already set up and you ‘manage’ the day to day running of the place. Again, the outlay is usually high, you have employees to hire and manage, and it may take several years before you start earning profits. An online alternative:
Internet based business
This is where your ‘shop’ is a website or a blog and you retail and sell products through online tools. There are various websites and templates you can buy outright or membership, such as lead capture pages, sales letters, as well as a whole host of tools that will help you manage customers and relationships with customers, such as shopping cart tools for product listing and credit card processing, email marketing for follow up.
For the newbie, it can be a massive learning curve to understand what is needed and to do it well. Once you have your online store set up, you must learn how to research your target audience (keyword research), how to advertise (without going bust), how to market to them (psychology of buying processes, writing effective sales copy, relationship building, etc) and how to convert them into buyers. It’s not an easy game.
There are some quick in-roads, such as eBay selling or affiliate marketing (selling other people’s products and using pre-made sales templates). The profit margins are pretty low so you will have to sell hundreds or thousands to make a decent income and there is very little residual income with this model.
Network marketing business
Also know as MLM (multi-level marketing) or home party business, this often suits people who are socially outgoing and want to earn a few hundred pounds extra having fun with friends, work colleagues and family. Again you buy a stock of products and learn how to market these usually locally, but potentially to anyone anywhere. For example, you can use traditional advertising like flyers and newspaper ads and set up personal visits, open days, home parties, exhibitions, ladies evenings etc. to sell your wares.
The more stock you buy, the more ‘discount’ you get and thus, when you sell the products, the more profit you make. The company you join is important in many ways, but obviously in the type of product and the price level. Some products may suit your personal interests and knowledge more than others, e.g. household products, utility products, nutritional vitamin supplements, weight loss products. For people new to sales, it is good to go with a product you would actually use yourself and because the price levels are small, it may be easier to find customers and makes sales.
This kind of home business allows you to make two streams of income, one on products you retail (active income) and another on your ‘team’ of distributors you bring into the business and earn a percentage of commission on products they sell (passive residual income or ‘royalties’). This is called ‘leveraging’ your time, since there is a limit to how many customers one person can manage.
How much income you make depends on how good you are at sales and how many people you bring in and keep as distributors in your ‘downline’. This is the rule, the more people you recruit the more money you will make. But the disturbing statistics show that almost 90% of people who join an MLM or network marketing business never make significant income.
Top tier product marketing
This works on the same basis as network marketing, some of which can earn on 2,3,4 even 10 levels of commissions. So everyone has their ‘cut’ as reward for bringing others into the business and helping them to become successful by making sales. These businesses usually require a substantial investment in the product line, but use the ‘Get Paid Today’ or GPT business model, so you can quickly recoup your initial outlay because you earn very high commissions even on the first sales you make. There is no need to wait to build up a ‘downline’ and earn ‘royalties’ because you start making big front end commissions and residual income stream grows very fast. Commission ranges from $ 1,000 to $ 10,000 (and you can get it immediately!)
So for my own experience, it seems fairly clear cut. If you learn to market online, you can sell any product to anyone, anywhere in the world. Why on earth then would you choose to market low cost products and not top tier products and get paid today? It would be ridiculous, wouldn’t it? But so many people start a home business or online business without knowing the key differences.
Just to clarify for you then:
For brick and mortar, franchise, network marketing or online businesses…
– Your costs will often be far more than your profits in the short term at least.
– You have to keep working day and night for many years to build things up and to keep the momentum going in your business.
– Your residual income is dependent on how many people you bring into the business who are actively retailing and recruiting.
– This can take many years to develop and you will have to work hard to keep people who do just average since their expectations are rarely met.
– You have to pay transportation and handling of products and certain other charges, which includes maintenance of any advertising websites and for tracking sales and customers and team activities.
– You can add up all the different monthly fees for your individual tools, which are much higher than expected.
– Couple with the low commissions earned, you will probably not break even – ever.
In the Top Tier GPT model…
You get paid today. Your direct sales commissions are immediately paid to you and your compensation does not depend on the number of people in your downline. Because you are retailing high-end products and services, the profit is considerably higher compared with other businesses. Many top tier opportunities also reward you for referrals and pay a commission several levels deep so you can build up a residual income over time. Because you earn a good ‘active’ income, you can quit your ‘day job’ in months not years.