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What does it mean when a start-up fee goes down?

A most attractive feature embarking on a network marketing business is the low start-up cost. Traditionally multi-level marketing companies have asked prospects for “earnest money,” usually a fee between $500 and $1,000, to get started. This amount is considered payment for product samples etc.; if a company demands more than that, it’s usually an indication of something more than a sample box … or it’s a bad investment.

But what about when a reputable network marketing company asks for less than $500 in a start-up fee. And what if a company slashes its start-up fee lower than that?

In 2011, 5LINX — an established MLM business, one of the top Global 100 companies according to Direct Sales News — charged a $499 start-up fee to new recruits. The next year, the fee was slashed to $259. Today, 5LINX offers a two-tier start-up plan. The fee for a Independent Marketing Representative — including personal starter kit and website — costs $249.00. And the company’s Customer Representative kit costs only $99! Talk about bucking the trend of inflation.

Is this move based on sluggish sales or taking a step toward all-out momentum? Without knowing the internal motives of the privately held company, we can only speculate that the price drop indicates the time is ripe to join the network marketing company as they are set to expand …

Or perhaps it’s just an indicator of lowering the ante to beat the competition. One of 5LINX’s primary competitors, had priced its initial investment for network marketing prospects at $399.

 

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