Leverage refers to what takes the growth of the business from a linear increase (adding customers gradually) to an exponential expansion (multiplying the customer base).
One type of leverage—residual income—involves getting paid repeatedly for your previous efforts.
People get paid royalties for inventions, books, songs, and all sorts of creative products.
People can also create residual income by marketing a valued, consumable product, taking good care of their customers, and continuing to add new customers each day.
One of my apprentices started selling pagers from a tiny storefront on a busy street in his town (back when pagers were popular).
He sold the service for $8.96 per month and earned two dollars in profit from each pager every month.
At the peak of pager use, he had acquired over 5,000 satisfied customers. In 1993, over $10,000 each month in residual income provided him a great lifestyle!
Another type of leverage involves capitalizing on the efforts and resources of others.
The power of capitalism can be found in the fact that everything an entrepreneur needs to expand an enterprise can be had for a price.
By offering incentives and rewards, a business can attract the talent, resources, ideas, and strategic partnerships that can lead to dramatic growth.
The principle of being of service applies toward these stakeholders just as much as it does with your customers.
Zig Ziglar’s axiom applies to all relationships: You have to give to receive. For any partnership to thrive, there must be a mutually beneficial exchange of value.
So in my business, though I could easily sit back and rest, I am constantly striving to find new and better ways to support and serve my apprentices, business associates, and customers.
As a result, I now earn residual income from the efforts of over a million people. That’s what I call leverage.
Does It Work?
Once you’ve satisfied your concern for the credibility and leadership behind an opportunity, and you are on board with their products and services and the markets they intend to serve, you will find yourself addressing another set of issues under the general question: “Does it work?”
Here you begin to assess your chances for success with this specific opportunity.
There are three essential components of this evaluation:
- The compensation program.
- The business building system and tools.
- The training and support that is available for you.
Every franchise, networking company, direct sales outfit, and affiliate program offers a compensation plan.
Each opportunity attempts to reward those who produce results. A whole variety of compensation plans exist. Though they all have advantages and disadvantages, the proof is in the pudding.
Here is where the idea of leverage becomes critical. What is the opportunity for residual income? Are you able to capitalize on both kinds of leverage (repeat business and duplication of effort)?
Meet people at various levels of achievement with the opportunity and ask them about their experience. Also ask to examine the documentation.
If it seems you are being offered a “something for nothing” proposition, move on to another opportunity.
But if people are producing the kinds of results and earning the amount of residual income that would satisfy your desires, then continue your evaluation.
Next, examine the business-building system. How do they attract, serve, and retain customers? What kinds of technology are involved, and what do they cost to use? Are any of the systems automated?
A good business system helps you to focus your resources and energies on the most productive activities.
In my business system, I teach that there are only three productive activities. First we need to pique the interest of potential customers and future associates.
We do this through advertising, online marketing, and personal contact. Second we point those who are interested to where they can get their questions answered and get started.
Third we promote events, resources, ideas, and tools that can help our customers and associates achieve their desired results.
In my programs, I offer automated systems that streamline all these essential business-building activities.
The Internet makes marketing so much more efficient today. In what we sometimes call old school marketing, we used to meet prospects at a hotel for a presentation, and the process of getting a new person started in business could take a week or longer.
Now a person can view an online presentation, get his questions answered, get set up, and have his or her own prospects calling and asking for more information in just a few hours.
The final component in answering your question, “Does it work?” involves training. Every business system requires some education and practice.
You want to find out what training this business makes available so you can quickly learn the skills you need to succeed.
Any program worth your time and energy will allow you to participate in basic training before you commit to get involved.
This allows you to understand exactly what actions, skills, and resources it requires to achieve success.
One of the great things about the training available in a good marketing company is that it will also help you succeed in other businesses.
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