MULTI LEVEL MARKETING

MLM is community of people who tell others about great products and services they know and like. By adopting MLM concept a manufacturer gains an ability to reach the end-user directly through a distributor. Thus bringing to life the idea of individually thought about needs of a consumer says Burkes hedges. This is not only convenient, but also very important in a modern society. Multi level Marketing is a modern system of distribution that is based on quality of serving the end consumers and keeping good relationships with them. istorically, this system goes back to economic practices of pre-industrial society when a manufacturer and customer lived without an intermediary having more personal kind of relationships. !ppearance of mass production and evolution of distribution systems led finally to standardi"ation and depersonali"ation of trade. 4.2 Working of Multi-level Marketing !"te# Multilevel Marketing system works through network of thousands of independent of distributors. istorically, #irect $elling companies sold goods to

distributors for resale or paid them commission when they sold products to the customers. %n new MLM &ompanies, distributors make money not only by selling goods and services but also recruiting other salespeople and receiving commissions or bonuses on the sales of those distributors ' their down ' line organi"ation.

Therefore, distributor ! receives commission at multiple levels in the organi"ation and it is true for other distributors. #istributor ! is up ' line to distributor B, & and # and B, &, # are called down ' lines. )urther B, & and # will be up ' lines to ne*t level. )ig. +.( works and various levels of MLM. There is no time limit imposed on it. !t anytime, when some one is free, he , she can work to get an additional % come by -oining that network. The harder a distributor woks, the more income he gets in the form of commission. %t can also be started from home and hence is sometimes termed as . ome based Business/. The cost for an individual to start an independent MLM marketing business as a distributor is typically low. 0sually a moderately priced sales kit is all that is required for one to get started, and there is little or no inventory or other cash commitment required at the beginning. Therefore, we can say MLM is a unique way of distribution. 4.$ %ifferen&e 'et(een Tra)itional Retailing !"te# an) MLM !"te# The method differs from Traditional methods of distribution in three basic ways 1 4.$.* +o#,o"ition of "ale" for&e The most important difference between traditional marketing and MLM system lies on distributors who replace the sales representatives, factory salesman, wholesalers and retailers. They buy their products directly
2

provides clear picture of how MLM

from

producer 3from his warehouse4, and in this way themselves become his own customers who further sell the products to the consumers. The traditional

required the producer to look for a wholesaler who in turn supplied to retail stores where customers buy products. %n MLM each distributor directly or indirectly 3through other distributors4, works with the &orporation. %n Traditional marketing, sales representatives are most often the employees of a given company, warehouse or the store. They are answerable to and dependent on their respective companies while in MLM, distributors are independent salesmen who work directly with the corporation and with other distributors as their partners. %f a producer wants to enter a market as a new MLM firm, he has to find the right people in the ma-or regions of the country. e has to

teach them every thing about his products and marketing plans. The producer assists and helps in sponsoring of down ' line and development of a network. e

organi"es courses, training sessions, seminars, products demonstrations and various other meetings. The producer is vitally interested in the correct

preparation, start, activities and attitude of distributors, since it creates power for further sponsoring of a down-line and product sales. 4.$.2 -rofit )i"tri'ution %n Traditional business, according to Burkes edges, the owner of

the business en-oys the ma-or chunk of the profit. The profits are shared with another person, namely with an owner of a sales office or sales agent, who looks for sales out ' lets for a particular producer. !ll these profits become the first
5

component of the final price of the product. The second ma-or component is the cost of the product distribution. %t consists of storage e*penses, workers wages, rent, depreciation and many others, with advertising as ma-or price inflating element. By eliminating ma-or links of distribution chain, MLM lowers its costs to minimum. 6bviously, it is not possible for all costs to be eliminated. Transportation is necessary as well as storage in various regional distribution centers. %t also needs some necessary administration. owever, by cutting out

middlemen, MLM is able to set aside about 78-98: of retail price of the product. #istributors, who take it upon themselves to buy and demonstrate products , to advertise and sell, as well to recruit additional distributors into network that they create, results in money saving according to rules and regulations established by their corporation. 6ne part of the distributor profit is included in the price for which he buys his products from the firm. is price is lower by 28-58: than the suggested

retail price. $o one of the components of his income is $avings 3when he buys for his own use4 or ;rofit from resale. The second and the most important component of the distributor<s income in every MLM network is the =olume Bonus. %t includes not only his personal turnover but also the turnover of his network that he has built. is

network consists of other distributors who operate under same legal and ethical code, code who remain in partnership with one another.
+

>ach distributor

represents an independent, self ' governing business. There are no supervisors or employees, no managers or e*ecutives. >verybody is his own boss. !part from above mentioned elements of the distributor<s income, there are still many other bonuses and awards. %ndividual corporations within their own specific systems establish them. 4.$.$ T.e Met.o) of "elling The thing that distinguishes MLM from Traditional distribution so drastically is the relationship between the salesmen and the customers. %n

conventional system it is the customer who looks for the stores, and goes back and forth between them to make his purchases. %n MLM, it is the distributor<s task to find his way to a customer. The consumer can do his shopping without having to move from in front of his television set. %nstead of losing time on trips to different stores, people receive competent service e*actly where and when they want it. %n addition, their salesmen devote more time and effort to a detailed e*planation of product<s features and usage. #istributor demonstrates the

effectiveness of the products and can also compare them to other products. >stablishing good relations with customers is one of the important elements of success in the current market place. Therefore, we can see MLM is fundamentally different from Traditional Marketing system. The corporations following MLM system devise their own Marketing ;lans based on basic structure of MLM system. To have a

better understanding of MLM system, the marketing and MLM corporation ' !mway was studied.

sales plan of largest

4.4

A#(a! ale" an) Marketing -lan The sales and marketing plan is corner stone of the !mway business.

%t encourages #istributors to sell products and sponsor other #istributors through e*tensive system of !wards and @ewards that recogni"e the increasing amount and effort required to achieve higher performance levels. To build a successful #istributorship, a #istributor must sell products and sponsor other individuals as #istributors. 4.4.* Mer&.an)i"ing A#(a! -ro)u&t" !mway offers wide range of high quality products. By using the products and recommending them to others, distributors can earn profits i.e. if they use the products themselves they benefit by getting them at discounted price and if they sell them to others they earn profits. !s the !mway products are

consumable, !mway distributor will have to provide regular replenishment to their customers, giving opportunity to #istributors to demonstrate lots of other !mway products and hence continuous profits. !nd also, distributor gets some percentage of profits of products sold or consumed by his down ' line. !ccording to !mway, their products are the foundation upon which business of a #istributor grows. !nd having -ust 28 customers can give a distributor workable base for

monthly retail sales and can be source for potential #istributors by providing referrals. 4.4.2 ,on"oring ne( )i"tri'utor" The second method of e*panding !mway business is by sponsoring other #istributors and training them to demonstrate !mway products and sponsor new #istributors themselves. !s the group grows, it will purchase and sell greater amounts of products and increase the income accordingly. 4.4.$ !"te# of in&o#e )i"tri'ution un)er A#(a! #istributors can generate income in two ways 1 *. Retail ale" -rofit" #istributors purchase products from !mway at

#istributor cost and then sell these products at a higher price 3not more than the printed M@;4. #istributors keep this difference that is the retail sales profit. 2. -erfor#an&e In&entive / These are based on monthly calculation of

individual and group ;=,B=. This incentive is based on a slab system that ranges from 5: to 2(: depending on business volumeA table +.( shows the percentage incentive under respective B=,;=. distributor<s efforts. Table +.( ;erformance incentive Table of !mway B= is +,88,888 2,B8,888 (,78,888 B8,888 +8,888 28,888
9

The earnings are proportionate to the

%f total monthly ;= is (8,888 9,888 +,888 2,888 (,888 ?88

;erformance %ncentive is 2(: of the B= (B: (?: (2: C: 7:

(88

+,888

5:

;oint =alue 3;=4 is a unit amount assigned to each product. %t is an effort inde* that puts emphasis on the units sold and not the selling price. >ach month the ;= is totaled in order to determine the ;erformance %ncentive bracket. These brackets range from 5: - 2(:. Business =olume 3B=4 is a monetary figure assigned to each product. %n order to calculate the performance %ncentive the percentage amount determined by total ;= is applied to the total B= for the month. The ratio of ;= to B= is (;= D +8 B=. Business =olume 3B=4 D #!; ' $ales Ta* Ehere, #!; is #istributor !cquisition ;rice The relationship can be better understood with the help of an

e*ample ' #!; value for >-+(((-%# &ar Eash offered by !mway is @s. (9?, B= for it is @s. (?? and ;= will be B=,+8 that comes out to be 5.BB. ;erformance %ncentive is calculated by taking into account 1 (. 2. @etail ;rofts , #iscounts. &ommission ;ayments.

#iscounts 1 ;erformance %ncentive percentage applied to the B= of #istributors own purchases for the month.

&ommission 1

The difference between the #istributor<s own performance

incentive and the incentive percentage of any of his sponsored down ' line multiplied by the B= of his business group. The amount of income generated at 5 levels has been given below in form of cases of have better understanding if income plan offered by !mway. &ase ( !ssumptions (. 2. 5. $ponsor and $ell products worth (88 point value 3;=4 Fo down ' line. )or retail profit percentage, average of 28: is taken.

( ;= D +8 B= Business =olume 3B=4 D (88 * +8 D +,888 @etail ;rofits 328:4 D 328,(884 * +,888 D @s. B88,-

&ommissions 1 Fo down line D Fil #iscount 1 (88 ;= ' 5: of B= 3+8884 D @s. (28,3&ommission includes discount amounts4 Therefore, %ncome of the month will be D @s. C28 !nnuali"ed %ncome 1 @s. C28 * (2 D @s. ((,8+8.

&ase 2 !ssumptions 1
C

(. 2. 5.

#istributor sponsors total of C people. #istributor and his personally sponsored #own ' line earn only ?8 ;=. )or retail profit percentage, average of 28: is taken.

@etail profit D 28: on an average of the sale price D 328,(884 * B= 3?8 ;= * +84 D 328,(884 * 2,888 D @s. +88 Total Group pv D #istributor<s own ;= H his C down ' line<s ;=s D ?8 H 3C*?8;=4

Total Group B= D +8 * ?88 ;= D 28,888 B= &ommission 1 Total commission generated at 7: level since group ;= is ?88 D 37,(884 * Total group B= 3?88 ;= * +84 D 37,(884 * 28,888 D @s. (2,88. &ommission paid out to down ' lines 1 Fobody qualifies as all are earning only ?8 ;=, while minimum qualification level is (88 ;=. Therefore, .;aid 6ut/ D F%L &ommission for the month D @s. +88 H @s. (,288 D @s. (788 !nnuali"ed &ommission D @s. (,788 * (2
(8

@s. (C, 288

&ase 1 5 !ssumptions 1 $ame as previous case but each of the personally sponsored distributors sponsor 7 more people. @etail ;rofit D 28: on an average of the sale price D 328,(884 * #istributor<s B= 3?8 ;= * +84 D 328 ,(884 * 2,888 D @s. +88 Total group ;= D #istributor<s ;= H C #istributors ;= H ;= generated by their 7 down ' lines . Total group B= D +8* 5288 ;= D (,2B,888B= &ommission 1 Total &ommission generated at (2: level since Group ;= is 5,28. D 3(2,(884 * Total group B= D (2,(88 * (,2B,888 D @s. (?,578 &ommission paid out to down ' lines 1 The personally sponsored down ' lines are at 5: level with 5?8 ;= D C * 35,(884 * 35?8 ;= * +84 D @s. 5,9B8
((

Therefore, the commission of the distributor for the month D @s. (?,578 ' @s. 5,9B8 H @s. +88 D @s. ((,CB8 !nnuali"ed &ommission D @s. ((,CB8 * (2 @s. (,+5,978

4.0

Re(ar)" an) Re&ognition Through out the !mway world the company provides many

motivational tools to its distributors to accomplish significant business goals. To build a successful #istributorship, !mway encourages #istributors to sell and sponsor other individuals ad #istributors. !nd through an e*tensive system of !wards and @ewards !mway recogni"es the increasing amount of effort required to achieve higher performance levels. This performance based commission program has been designed to maintain and increase profitability of productive distributorships ' which are those that provide leadership to service, motivate and train new distributors. !s with all compensations provided under the !mway $ales and Marketing plan, the commission program is based on performance and paid with funds generated through sales of !mway products in %ndia. 4.0.* Re(ar)"

(2

!ll distributors are eligible to receive financial rewards based on their merchandising and sponsoring activities and that of their sponsored group. These include, (. 2. 5. +. ?. @etail Margins , ;rofits ;erformance %ncentives !dditional Monthly &ommissions !nnual &ommissions 6ne ' Time cash commissions

4.0.2 A(ar)" To recogni"e and reward the achievement of the distributors, !mway has an e*tensive !wards and &ommission $ystem. !n award is defined as anything outside the sales plan commission payment. !ll #istributors are eligible to receive personal recognition awards including. (. 2. 5. ;ins 3$ilver ;roducer onwards4 &ertificates 3#irect #istributors onwards4 @ecognition in!magram. 3!magram is a maga"ine published by !mway &orporation4 +. ?. !mway sponsored trips and seminars. ;ersonal Letters of recognitions from !mway.

%ou'le %ia#on) %ire&t %i"tri'utor !warded by !mway to those qualified #irect #istributors who have sponsored (2 legs each of which was at performance bonus level for at ' least 7
(5

months during a fiscal year. ?,28,888 rupees.

e also qualifies for a one time cash amount of

+ro(n A#'a""a)or %ire&t %i"tri'utor !warded by !mway to those qualified #irect #istributors who has sponsored 28 legs each of which was at 2(: performance bonus level for at least 7 months of the fiscal year. 5,(28,888 rupees. -ART 1 II Multilevel companies boast of providing business opportunities to people by making them distributors and the system works as endless chain i.e company hires investors who further can recruit others and so on and each getting profit shares. But not always after acquiring the distributorship the distributors pursue the business such distributors are called ;assive #istributors and those e may also receive a one time cash amount of

who involve are called !ctive #istributors. This selection deals with comparison of !ctivity ;rofile of !ctive and ;assive #istributors associated with !mway. &omparison is based on information collected through the questionnaires. 4.2 3rief -rofile of %i"tri'utor" 6ut of the (88 distributors covered by two had !mway as a full

time business rest C7: carried !mway activities in addition to their full time business which included computer designing and printing, software business, teachers and lecturers, chemists, medical practitioners, financial consultant, government

mechanics, shop owners, -ewelers, laourer, salesmen, official in

(+

organi"ations and e*ecutives in private sector. $tudents and housewives have also played their bid to make fortune out of !mway business opportunity. The !ctive #istributors were associated with !mway from periods ranging from ( month to 5 and (,2 years while in case of ;assive distributors

B8: of the distributors quit in first 7 months of their -oining. 52: of the active distributors were working at 7: level of activity , 22: at (2: level, (B: at C: levels and 7: at 2(: levels while in case of ;assive distributors only 28: were getting performance incentive that too below C:. 4.2.* Rea"on" for 'e&o#ing A#(a! %i"tri'utor Table +.2 shows the reasons as to why distributors associated with !mway. Table +.2 @easons for becoming !mway #istributor. @easons !. Money B. $ecure )uture &. To utili"e free time #. %nfluence from other distributor >. 6ther 3like to fulfill obligations etc.4 ?7: of the active distributors associated with !mway to earn more moneyA 57: for secure future as !mway ensures unending income after reaching !ctive #istributors Fumber ;ercentage 2B ?7 (B 57 ( 2 5 7 ;assive #istributors Fumber ;ercentage (? 58 5 7 ( 2 27 ?2 ? (8

(?

#irect #istributorshipA 2: to utili"e free time and remaining 7: because of influence from other distributors wile in case of passive distributors ?2: -oined !mway because of influence from other distributors who were either relatives or friendsA 58: were motivated by moneyA 7: -oined in order to secure their futureA 2: to utili"e their free time and (8: because of reasons such as growing and ongoing income and some were forced into the business in order to fulfill certain obligations. 4.2.2 Kno(le)ge level" of A#(a!4" ,ro)u&t range 6ne of the ingredient for success as a distributors as proposed by !mway is complete knowledge of product range offered for sale by !mway &orporation. The levels of product knowledge of the respondents are summed up in table +.5 Table +.5 Inowledge levels of !mway<s product range. !lternatives !. &omplete knowledge B. Moderate knowledge &. ;artial knowledge #. %nsufficient knowledge 2 D (C.BJ !ctive #istributors Fumber ;ercentage 58 78 (5 27 ? (8 2 + ;assive #istributors Fumber ;ercentage (8 28 (9 5+ (+ 2B C (B

2 degree of freedom and ?: significance level. 78: of the active distributors had complete knowledge of product rangeA 27: had moderate knowledgeA (8: had partial knowledge and remaining +: had insufficient knowledge as their relations with !mway was less than one

(7

month old. 6n the other hand, only 28: of the passive distributors had complete knowledge of variety of products offered by !mwayA 5+: knowledgeA (B: had insufficient knowledge. %n order to find out whether there was any association between the knowledge levels and the success as a #istributor, &hi ' $quare test was applied. ypothesis 1 There is no association between product knowledge levels and success as a #istributor. The &hi $quare value was (C.B that is significant at ?: level of significance. ence, it can be concluded that knowledge levels contribute to success of an individual as a distributor. 4.2.$ Level of -ro)u&t U"age / !mway proposes a distributor can more forcefully endorse the products if they are themselves satisfied by the results of product usage. had moderate

Therefore (88: product usage is recommended. Table +.+ depicts usage levels of products by the respondents.

Table +.+ Level of product usage. !lternatives !. 8-2?: B. 2?-?8: &. ?8-9?: !ctive #istributors Fumber ;ercentage 2 + 2 + B (7
(9

;assive #istributors Fumber ;ercentage 58 78 (+ 2B

#. 9?-(88: 2 D ++.9BJ

5B

97

(2

J 2 degree of freedom and ?: significance level. 97: of the !ctive #istributors have used the complete product range of !mwayA usage by (7: distributors lie between 28-?8: and last +:<s usage lie between 8-2?: of the product range. 78: of the ;assive #istributors have -ust used 2?-?8: of the product range offered by !mway &orporation and only (2: have used the entire range while remaining 2B: product usage fall under the category of ?8-9?:. %n order to find out whether there was any association between the usage levels and the success as a #istributor, &hi-$quare test was applied. ypothesis 1 There is no association between product usage levels and success as a #istributor. The &hi square value was ++.9B that is significant at ?: level of significant. ence, pro-ect usage levels contribute to success of an individual as a #istributor. 4.2.4 Ti#e )evote) for A#(a! a&tivitie" %n order to be successful as an !mway distributor, one is required to spend two hours daily seven days a week for !mway activities. The responses regarding time devoted by distributors for !mway activities have been given in table number +.?.

(B

Table +.? Time devoted , week for !mway !ctivities !lternatives !. 8-5 hrs, week B. +-7 hrs.,week &. 9-C hrs.,week #. (8 hrs. or more , week 2 D +(.?5J !ctive #istributors Fumber ;ercentage + B + B (5 27 2C ?B ;assive #istributors Fumber ;ercentage 29 ?+ (5 27 (8 28 -

J ( degree of freedom and ?: significance level. ?B: of the !ctive #istributors spent (8 hrs or more 3ma*imum up to 29 hrs.4 for !mway activitiesA 27: devoted 9 to C hrs. , week A B: devoted +7 hrs. , week and remaining B: spent 8-5 hrs. , week of the ?8 passive

distributors?+: spent only 8-5 hrs. , week for !mway activities A 27: spent +-7 hrs. , week A and remaining 28: spent 9-C hrs. , week. %n order to find out whether there was any association between the time devoted , week and the success as a #istributor, &hi ' square test was applied. ypothesis 1 There is no association between time devoted , week and success as a distributor. The &hi square value was +(.?5 that is significant at ?: level of significance. ence, amount of time devoted , week for !mway activities and matter for success of an individual as a #istributor. 4.2.5 Level of fa#il! ,arti&i,ation

(C

!ccording to !mway, family participation is of utmost importance to run the direct selling business successfully. Therefore they promote

involvement of souse, parents and other family members into !mway activities. The responses obtained to question whether distributors involved their families with them are summari"ed in table +.7. Table +.7 )amily ;articipation. !lternatives Kes Fo 2 D 58.(2J !ctive #istributors Fumber ;ercentage 5+ 7B (7 52 ;assive #istributors Fumber ;ercentage 9 (+ +5 B7

J ( degree of freedom and ?: significance level. 7B: of the active distributors have involvement of their family members ' spouses, parents, brothers, and sister in laws etc. in carrying out !mway activities. !ccording to them, involving family members give them wider range of contacts to lie e*ploited. !nd as the products are of household nature, having female endorser enhances the credibility and can demonstrate the product in better way. %n case of passive distributors, -ust (+: of the distributors involved family members in carrying out !mway business. %n order to find out whether there was any association between the family participation and success as a #istributor, &hi ' square test was applied.

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ypothesis 1 There is no association between product family participation in !mway business and success as a distributor. The &hi square value was 58.(2 that is significant at ?: level of significance. ence, family participation contributes to success of an individual as #istributor. 4.2.0 Nu#'er of %o(n 1 line" The higher the number of down ' lines registered for !mway greater is the level of profit, (88: of the !ctive respondents were successful in converting a prospect into #istributor. 6ne of the !ctive #istributor who was associated with !mway for over three years had registered (B down ' lines and was working with the group of (88 #istributors. %n case of passive #istributors, B8: of them were unable to register any down ' line. 4.2.2 ear&. for ,ro",e&tive %o(n 1 line The search for ;rospective #istributor in case of ;assive #istributors was limited to friends, relatives and other contacts in their known circles while the !ctive #istributos did not restrict their work area. .!ny body whose heart is beating and body temperature normal is my ;rospect/, commented one the respondent. .!ny body walking besides me on the road or sitting ne*t seat in bus is my prospect/ commented another

2(

respondent. Telephone directory was another source of prospective #istributor for !ctive #istributors. The difference in activity levels of !ctive and ;assive #istributors could also be understood from profiles the two had in mind of the prospective down ' line. The qualities !ctive #istributors looked for in a prospect were

ambitious, honest, serious, smart, with ledership qualities, having pleasing personality, having desire to learn and earn, having instincts for winning, has self ' confidence, is interested in money making, is competitive and one who has strong character. Ehile ;assive distributors looked for individuals who were easily convincible, had free time and money and who were un-thoughtful spenders. 4.2.6 +onver"ion rate of -ro",e&tive in to a %i"tri'utor 6ne being asked about number of hits that converted a prospect into distributor, the responses, which were given, are summed in table +.9. Table +.9 !verage its required for converting a prospect into distributor. !lternatives !. (-2 times B. 5-+ times &. ?-7 times #. 9 times or more e. Fot able to register down 'line !ctive #istributors Fumber ;ercentage C (B (C 5B (+ 2B B (7 ;assive #istributors Fumber ;ercentage 2 + 5 7 ? (8 +8 B8

22

6n an average, (B: of !ctive #istributors were able to convert a prospect into #istributor after (-2 hitsA it took 5-+ hits for 5B: active

respondents, 2B: required ?-7 hits and rest (7: converted into a down ' line after 9 or more hits. %n case of ;assive #istributors, B8: of them were not able to sponsor any #istributor either because they didn<t have sufficient contacts or were registered with !mway unwillingly. 6ut of the remaining, +: were able to convert prospect into #istributor in (-2 hits, 7: in 5-+ hits and (8: in ?-7 hits. 4.2.7 Atte#,t" after (.i&. %i"tri'utor" "to, ,ur"uing t.e ,ro",e&t The responses to the question that after how many attempts did the distributors stopped pursuing the prospect are given in table +.B. +.B !ttempts after which #istributors stop pursuing the prospect. !ctive #istributors Fumber ;ercentage (+ 2B B (7 (+ 2B (+ 2B ;assive #istributors Fumber ;ercentage (9 5+ 7 (2 ? (8 C (B (5 27

!lternatives !. 2-5 times B. +-? times &. ?-7 times #. 9 times or more >. #idn<t try

2B: of the !ctive respondents stopped pursing the prospect after 25 attempts to convince, (7: stopped after +-? attempts and remaining 2+: pursued the prospect s for more than seven times. %t was their dreams, which motivated them to push a prospect to become a #istributor. The dreams varied from owning a Mercedes to owning a

25

palatial house with a swimming pool to world tours with respective families to buying everything which money could buy. 27: of the ;assive respondents never tried to sponsor any #istributor, 5+: pursued the prospect (-2 times, (2: tried 5-+ times, (8: pushed ?-7 times and remaining (B: pursued more than 9 times.

4.2.*8 Atten)an&e of Meeting" an) e#inar" !mway conducts each $unday meetings for its distributors and their prospects. #istributors are required to attend the meetings each week. The responses of #istributors whether they attended meetings regularly or not is given in table +.C. Table +.C !ttendance of $eminars and Meetings. !ctive #istributors Fumber ;ercentage +2 B+ ? (8 ( 2 ( 2 ( 2 ;assive #istributors Fumber ;ercentage ? (8 C (B (( 22 (8 28 (? 58

!lternatives !. !lways B. Mostly &. $ometimes #. @arely >. Fever 2 D ?B.(BJ

J 2 degree of freedom and ?: significance level. 6f the !ctive respondents B+: attended meetings always. .My marriage was on Mondy/, said an enthusiastic #istributorA (8: mostly attended the meetings, 2: attended them sometimes, another 2: rarely attended and last 2: didn<t attend at all.

2+

6f the passive #istributors, 58: never attended any meeting, 28: rarely did, 22: sometimes attended, (B: did it mostly and (8: always attended. %n order to find out whether there was any association between the attendance of meetings and seminars and the success as a #istributor, &hi-square test was applied. ypothesis 1 There is no association between attendance of meetings and

seminars levels and success as a #istributor. The &hi square value was ?B.(B that is significant at ?: level of significance. ence, attendance of meetings and seminars contributes to success of an individual as a distributor. 4.2.** A#(a! E)u&ation !"te# !mway has an official >ducation system provided by Britt worldwide which the #istributors are required to follow. The education material includes books and other reading material and audiotapes. The education system aims at providing guidelines for how to and where to search a prospect, how to approach him and maintain relationships. The education system also provides inspirational te*t and tips on improving overall personality of an individual. Table +.(8 shows the responses obtained to the question that

whether #istributors followed the education system referred by !mway.

2?

Table +.(8 )ollowers of !mway<s >ducation $ystem. !lternatives !. &ompletely followed B. ;artially followed &. #idn<t follow 2 D ?2.?BJ J( degree of freedom and ?: significance level. C2: of the active respondents completely followed the education system and remaining B: followed the system partially. #istributors 28: %n case of ;assive !ctive #istributors Fumber ;ercentage +7 C2 + B ;assive #istributors Fumber ;ercentage (8 28 (9 5+ 25 +7

completely followed the education system, 5+: partially

followed and remaining +7: didn<t follow %n order to find out whether there was any association between the knowledge levels and the success as a #istributor, chi-square test was applied. ypothesis 1 There is no association between following of !mway<s >ducation system and success as a #istributor. The chi square value was ?2.?B that is significant at ?: level of significance. ence, following of the !mway<s education system contributes to success of an individual as a #istributor.

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%n order to check that whether there was any significant difference between the responses of responses of !ctive and ;assive #istributors regarding effectiveness of Britt-worldwide t-test was applied. ypothesis1 There is not significant difference between the responses of !ctive and ;assive #istributors. 4.2.*2 9ee)'a&k !"te# %n response to how the !ctive #istributors motivated their down-lines, they asserted that they maintain constant contact with their down-lines, keep reminding them their dreams, encourage them to follow education system referred by !mway, conduct meetings at personal level etc. They also helped their downlines in case of any problem. Ehile ma-ority of the ;assive #istributor didnLt have any contact with their down-line or up-line. $ome of the distributors who discussed difficulties faced by them with their up-line, said difficulties were never solved. 4.2.*5 Rea"on" for :uitting A#(a! The reasons behind high dissatisfaction levels led the #istributor to quit !way business. 6ther reasons that led #istributors to divorce !mway were

higher profitability of their full-time business, lack of time for !mway activities and also shortage of contacts and inability to register sales. But when !ctive #istributors were asked why #istributors fail, they asserted because they donLt have conviction in their dreams, lack confidence, want
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to make easy profits without putting in effort and above all they donLt follow >ducation system referred by !mway.

2B