Investment Versus Expense | Understand the Difference in Network Marketing

Network Marketing concept: ‘A business model in which a distributor network is needed to build the business. Usually such businesses are also multilevel marketing in nature in that payouts occur at more than one level’. Great – and in order to start this business, it entailed some type of investment. Whether this was a start up package, monies for a website, etc. Notice that we used the term investment versus expense. 

Understanding this Difference is Crucial

Let me explain. Somewhere along the way this difference becomes a blurred line. In a case where you are investing in a brick and mortar type business – this wouldn’t be such a debated topic.

investment versus expense

Let us consider a restaurant model. You have always had this dream of owning and operating a restaurant. Let’s say a Mexican Restaurant (I love tacos!) You have spent time researching the costs it would entail to open and operate this business. You would consider everything from; location, staffing, food costs, insurance, equipment, marketing, and so on.

You would probably speak with current restaurant owners – hear about their experiences, do’s and don’ts. And, you may even hire someone to coach you through the process from business plans, banking, etc.

You are about to make one of the biggest purchases of your life. It is your dream. You can picture the people lining up, the reviews about the best tacos in town, and sure that little voice in your head is saying something like ‘what if this doesn’t work?’. But, your passion and vision are able to quiet it down because THIS is your calling!

Now, here’s the point…

This is an investment into your future. Your family’s future. And hey, maybe this vision is a family business – a legacy you want to build.

There would be no question in your mind that this is an investment versus an expense. Right?

So, why is it any different when it comes to the profession of network marketing and direct sales? You are making an investment into those same ideals (vision, family, future). They, deserve the same ‘thoughts to follow through’ as it would when it comes to a restaurant, don’t they?

And yet, we start a business model for somewhere between $100 – $2000.00 and expect to build a multi five, six or seven figure business. Now, don’t get me wrong if there is any industry that this can happen it is in network marketing. But, we also know that most top earners have spent beyond that start up package to ‘open’ their business.

Maybe, they have invested in some personal development. Perhaps they have hired a coach or someone to help them elevate their business.

Most of all, they understood the difference in investment versus expense.

People fall into one or two categories when it comes to personal development. One group sees it

investment versus expense

as an expense while others view upleveling their performance as an investment. Where do you fall? Ironically, the most successful people I know, consistently invest in their personal development. It’s not a one time deal either. They are consistently mastering their craft.

For the majority of new network marketers, they decide not to put the car in drive and move towards their destination because they don’t view coaching, personal development, etc. as an investment versus expense.

Why?

One common reason is somewhere, deep down, they don’t believe they have the discipline to do what it takes to go after what they want. Maybe, they just don’t want it bad enough.

So they say to themselves;

I’ll only be flushing this cash down the toilet. Why bother.’

We all have doubts in our abilities. A coach, can help navigate through that negative chatter. And, they can help you make adjustments in your business or delivery that you may not even see are hindering your growth. Consequently, you don’t see the success you had hoped for. This is the unfortunate stage that we see people give up or say this doesn’t work.

Familiar with the Term, ROI?

ROI, means Return On Investment. We believe, understanding this term with help the distinction between investment versus expense. My wife and I, built a successful network marketing career after years of struggle. (more about our story can be found here) And, when we transitioned to building our network marketing business to working with other network marketers – I knew I had to hire a coach.

I knew, although I had unlocked the ability to build a substantial business – to help and serve the community more so, I required direction.

Investing in my coach was to the tune of thousands of dollars.

Were we scared and nervous? Absolutely – we’re talking car type money here! But, because I understood the word investment versus expense I was excited! We knew that working with this coach would 10X our business AND our ability to serve others.

I felt confident that this coach would equip me with the tools we needed to implement the learned skills and techniques effectively. I knew to serve the most amount of people, specifically in building a business using social media the right way – we needed to invest in this belief.

investment versus expense

Most of all, we knew the return on this investment would change our lives forever.

Furthermore, think about your own business for a moment (or the one you are looking to start).

  1. Write down your ninety (90) day game plan – what do you hope to accomplish?
  2. Think about your support team (if you don’t have one, please join our free community)
  3. Consider your budget for; events, personal development, books, etc.

Does number one excite you? Can you picture yourself there? Did you dream big enough?

Also, number two. If you haven’t written their names down – do that. If you are new to our community, welcome! Or, if you are one of our amazing social impacters, we’re happy you’re here.

Lastly, number three. Think about the response you told yourself when you read the word budget. This is where the difference in the understanding of investment versus expense lies. Seriously. I want to give you a few reasons why you need to incorporate an investment of personal development into your budget. (personal development can include coaching, courses, workshops, events, etc. Anything that will better YOU, is personal development)

5 Reasons to Incorporate Personal Development Into Your Budget  Investment Versus Expense

#1 You can’t always rely on your sponsor to be there for you. If what you need to bring yourself closer to your goals is not being taken care of by your sponsor, frustration and blame won’t help. It’s your future, take care of it!

#2 Excuses will not help you move forward. There will always be excuses. Lack of time, young children at home, more urgent expenses, etc. If you always put your personal development last, you may be missing opportunities you don’t even know exist right now. By planning your personal development in your budget, you make it a priority and can enjoy it without guilt.

#3 We don’t always make it alone. When we really need help, (to either develop our skills or get through our emotions) it’s a shame to be confronted with financial issues. When you have an amount set aside for coaching, training, etc., you could use it to give yourself a push when you need it the most. Think about it. It could be your best investment ever.

#4 Passion is essential to achieve balance. If you can’t find your passion through your work, or can’t express your creativity, you need to find ways to do it differently or life will pull you down. Personal development is also feeding the various aspects of our personality and minds. ‘A negative mind won’t lead you to a positive life’.

#5 We don’t know what the future holds. We don’t know what life holds for us. You could want new challenges, face adversity or a career change. It is your responsibility to develop your interests, your skills and knowledge to be ready to face any variable.

Leaders view People as an Investment Versus Expense

Leaders invest their time, experiences, knowledge and a piece of themselves in the development of people. The success of their team is as important to them as their own success. If their people fail they take at least partial ownership in that failure.

Let’s be clear on this, leadership is about people. We don’t lead companies, we don’t lead buildings or inventories, we manage them.

We lead people!

People don’t want to be managed, they want leadership. You’ll hear people often complain about being micro-managed but you’ve probably never heard a person say the word, micro-led.

In conclusion, consider your thought process on investment versus expense. To become the best leader for your group or team, you need to lead with your best self. It is okay not to know all the answers – what is not okay is doing nothing about it.

In the comment below we would love to hear what you thought about the reasons to include a budget for personal development into your planning. And, would LOVE to also hear about your 90 day game plan! 


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Investment Versus Expense