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MLM, drop shipping, direct sale, could it work?

Discussion in 'Dropshipping & Wholesale Hookups' started by loginname, Nov 20, 2015.

  1. loginname

    loginname Regular Member

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    I have made a webshop, which compensate customers in 2 ways:
    - Customer get % in commission based on sales from cusomers he has recruited
    - Huge discount based on how much the customer bought in previus month.

    This webshop I have created together with my business partner. My business partner is a old guy (senior citizen), who are considering to jump out of the project. Leaving me alone with this webshop. I have all the rights to the webshop. He has money to buy a warehouse of products customers can buy. If he bail out then I might need to look into if drop shipping could be applied instead.

    Do you know about other drop shipping webshops which are using MLM to get customers, give me link so I can read about it?
    One concern I have is that I'm not good in marketing and a real issue for me would be getting my first customers. But hope MLM would help on that?
    Beside this I'm looking for any advice on how to start slowly (meaning without funding, I have $500 in savings)?

    Basically I'm looking for a backup plan if my business partner chooses to bail out
     
  2. blogzandstuff

    blogzandstuff Elite Member

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    i think you are confusing MLM with starting your own affiliate sales scheme, If A sends people to your site and they buy then he/she is an affilate, if you are looking at MLM then a will recruit b, b with then recruit c and so on. to run such a program like that you will need software to keep track and pay commissions based on the pyramid. In the UK it is illegal to start in or be involved in a pyramid scheme, not sure about other countries. I would go down the affiliate route.
    These may help.
    https://wordpress.org/plugins/affiliates-manager/
    http://winningwp.com/how-to-set-up-an-affiliate-program-with-woocommerce/
     
  3. loginname

    loginname Regular Member

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    Thanks, but this is not illegal and not a pyramid scheme, reason for that is many:
    - Every body in the network can earn money, not only they on top
    - Commission is given to members in only 4 levels above the customer

    To give an example, our business plan is much similar to forever living. Our customers can choose to become a distributor and they get special discount based on how well they sell. Meaning if you are just a new customer you get no discount. if you become a distributor you get 10% discount on everything you buy. Meaning you can distribute it to you customers with a 10% profit margin. Best distributors get 25% discount

    MLM commission is not given on recruting new customers, instead it is given based on what customer buy. When a customer buy something his upline get rewarded in 4 levels

    We have software for calculating this. All I need is good customers/distributors to begin with and self-confidence that this can be done. I have already put about 1 year in programming the software so very much would like to see it work. That is why I look for an alternative way in case my business partner would bail out