BANKRUPT CREATOR or MONEY MACHINE?

It is a very common perception amongst ex-leaders of the MLM industry in Malaysia that with their money or funders behind them plus their so called 'networks' and rushing into the Indonesian market, starting an MLM Company seems the surest way of creating overnight wealth.

The truth is never near from such simple assumptions especially the Indonesian market. Sometime back in October 2007, someone with so much money started an MLM in Indonesia with a bang.

They launched it in a mountain resort not far from Jakarta. Flew in all the leaders from all over Indonesia, everything paid for from airline tickets to hotel rooms and the gala function.

Leaders were given free accounts. They reportedly had a budget of USD300,000+ ( RM1,000,000.00) to splash around. Within less than 3 months, that company became another case study.

That was not the only instance. I have been told by one friend in Jakarta, of a few other similar ventures with companies from China and Hong Kong meeting the same fate.

They thought by catching one or two self proclaimed 'great leaders' from Indonesia, they are in safe hands. But if so, how come they too suffered the same fate?

I was also informed by one CEO in Malaysia how he lost twice in the Indonesian market sometime back. Once RM2.5 million. Another more than RM10million.

So what went wrong?

1. COMPANY LEADERSHIP:

KNOWLEDGE

It has to start with the Company leadership. MLM is a very sensitive industry. Preferably, it has to be started and managed by someone with success track records in the field plus corporate management skills.

The leadership has got to have intimate knowledge what makes the market ticks and who to deal with to crack and vibrate the market to explosive impacts in creating the waves of momentum.

VISION

The Company Leadership has to have the vision of creating a business venture that will be hugely profitable, lasting and truly beyond borders.

It has to have a vision of moving towards building a billion dollar business within say the next 5-10 years. After all we are in the most populated and largest market potentials of the world, Asia.

INTEGRITY

One of the reasons why Malaysian or Asian Companies could not grow beyond small is very simple. Lack of integrity. It takes Integrity to become a true border less international player after Vision and Knowledge.

MLM SUCCESS EQUATIONS: What else?

So what makes people like Amway still thriving steadily? After Management. Is it products? Marketing plan? Pricing?

If it is that simple, how come companies end up in the bunkers?

After more than 10 years in the industry, through own and borrowed experiences of friends in the industry, observations and readings it all points to a very simple equation:

After Good Products, Reasonable Pricing and Attractive Marketing Plans all of those that failed had the most important equation missing - absence of a proper culture that binds people together to go on for the long term ride.

The proper culture of training and education encased in strong functions and events. Recognitions and travels. It is so simple and yet none of those that failed ever considered these something important to their growth and survival.

CONCLUSION

That is why when people approached me to join them in new establishments, no matter how much money they have or how huge the parent company that funds the proposed venture, I know they are not going to go places when they only talk about marketing plans and products.

Just in October last year, I was invited to a launching of a new company in Kuala Lumpur. It was quite a hoo-haa. The CEO has a Phd in Management. Strong Board of Directors with one Datuk as Chairman and share holder. Told myself quietly to give them 6 months. It lasted shorter than 6 months.

So, starting a new MLM Company minus the right equation is more of a bankrupt creating machine than anything else.

Yours truly,
Muhamad Abdullah.
K.L.