Hidden Costs in Free Opportunities

Discussion in 'Network/Multi-level Marketing' started by Mattathome, Mar 28, 2006.

  1. Mattathome

    Mattathome New Member

    Hi all,

    I was doing a little prospecting for my own Home Based Business recently and came across a gentleman that explained he was leery of any business opportunity that asked for money to get started.

    I responded that I understood, since there are more than a few scams out there, and we chatted for a little while more.

    He explained that he had looked into building toys and such from home, but declined when he found out the company wanted him to pay for them up front, and then reimburse him with extra once he had sent them back. At first I agreed with his skepticism.

    But once off the phone, I had the time to do a little thinking, and realized something. What company would ship an unassembled product to someone they don't know, for FREE, on the assumption that the person will ship it back to them? Answer: NO company.

    So you see, I have come to be wary of a company that charges up front fees to get started, (particularly of those who don't explain WHAT your paying for), but even MORE wary of those who promote their opportunity as free. Because invariably, there is always a cost of some kind, and if they aren't telling you what it is, they are most likely hiding it from you.

  2. Vishal P. Rao

    Vishal P. Rao Administrator Staff Member

    I'm reminded of $1 listings on eBay. They immediately catch one's attention. However, the seller simply adds the cost of the product to the shipping charges.
  3. CuriousGeorge

    CuriousGeorge New Member

    You are right. If a company charges a fee, they should at least give you all the information up-front.
  4. Mattathome

    Mattathome New Member

    Absolutely, in fact, I had one person recently point me to a website that intended to charge a person $10 to have them send out info for their opportunity. This was justified on the premise that it would deter the not-too-serious so they could concentrate their efforts on the serious.

    Well to some of the more naive (including the person I had been speaking to), this may seem a very plausible explanation. However, someone out there is laughing all the way to the bank, with a bag of $10 bills to boot.

    Please people, do not be sucked into these scammers. It only rewards them and allows them the opportunity to procreate, which in the end will be very bad for the rest of us...

  5. malibumentor

    malibumentor New Member

    There is no doubt that the "envelope stuffing" ops are largely scamville. Here's the plan, recruit some sucker to pay $30 for the starter kit and you are on your way to being in the money with it. The material stuffed in the envelope is just the same letter to recruit more envelope stuffers. A paid opp. but definitely B@LLS*%T.

    At the same time, by promoting a "free to join" program its possible to SPEND quite a lot of money signing up "something for nothing" seekers to get the few who will upgrade so we can get a few residuals, as long as those individuals succeed as promoters as well (and are thus inspired to continue to pay their fees).

    Whats the lesson here: It takes no more effort to promote a program where $1000.oo is made per sale than it takes to promote a "something for nothing" BAIT program. I did it for awhile. I know.

    I know from experience. I still promote a few things with free trials, but they are valuable promotional tools I would use even without affiliate commissions.

    My advice: position yourself in the marketplace not as a "bottom feeder" but as somebody who stands for the philosophy that a real business with real potential takes work and capital to be profitable.

    Everybody wants a free ride. Are we asking ourselves what we reap and what reality we create by purveying such programs?

    Choose programs that offer solid, indisputable value to serious, business-minded people. This means investment. Of course, the toy guy really wants a JOB. The toy company is totally right not to surrender the kits without collateral. And the "toy guy"? Probably Unqualified to build a real business.
  6. coreyjroman

    coreyjroman Silver Member

    Quoting: Vishal P. RaoI'm reminded of $1 listings on eBay. They immediately catch one's attention. However, the seller simply adds the cost of the product to the shipping charges.

    Reminds me of the free software commercials on tv for learning windows and other programs called video professor.

    Absolutely free cd-rom lessons just pay 4.99 shipping and handling...."Try my product" lol.
  7. malibumentor

    malibumentor New Member

    The psychology of the person seeking the FREE LUNCH sort of bizop is interesting. Now I, like you, love free stuff... But when it comes to business I have no illsusions.

    A real business with the cashflow potential to be worthwhile takes money to set up and market.

    There are a lot of individuals, many,many thousands in fact - who are bouncing around on the internet trying to promote these real "low-end" programs where you make $1 per month per signup, or whatever. The return-on-investment with these things is so low that paid advertising methods are not really viable.

    These folks wind up on the lowest rung treadmill and never seem to be able to come up with the capital to really make it happen with an internet business. This is unfortunate, because some of these people have the desire and smarts to do it but owing to real-world circumstances they cannot get involved in a biz that offer the potential for meaningful profitability.

    This is obviously discouraging and many quit. I am currently promoting a one-up where people can come in for $60 and pass up FOUR sales. Passing up four sales could be very demoralizing, but for those who absolutely cannto raise the $1500 to get in at a higher tier, its the only option.

    The point is I suppose, that anyone can probably change their situation, but messing around with low-end programs is not likely to do it. I even recommend people get a second-job or sell some things they have to raise business capital. I have done these things when I was starting out.

    Its important to choose the playing field we are going to be paling ON. If this is a playing field of FREE, we will likely make very little in the way of financial compensation.
  8. netvalar

    netvalar New Member

    Free trial programs are great for getting in and learning nore of what they are about. However to earn any kind of income rather residual or not you will at some point have to pay a fee. In the program I am currently focused on I suggest to all my downline to look over everything and get out if it is not for them. I might chase lots of people away but those who leave are usually the ones who would not do anything anyways. Of course I am a bit more pc about how I do that. And I make sure to give them enough information to succeed before they leave. The basics is that you have to be able to afford to pay something or you will never get anywhere.
  9. tomcha

    tomcha New Member

    Two things kept coming to mind while reading this thread.

    1. There is never such thing as a free lunch. You can't get something for nothing. But be careful, you don't always get what you paid for either.

    2. Even if the 'free' biz was real, you signed up and put forth great effort, how many real and serious business seekers are you likely to attract with the word "FREE" pasted everywhere in flashing bold red letters?

    And I have to agree with malibumentor. Marketing a large ticket item or a freebie item is virtually the same amount of work.

    Because you need to get the word out, and that is the largest part of the work, you are not making it any easier on yourself to go with the free business opportunity.

    The only difference is the result you get back. With the free op, you'll get more of the bottom of the barrel tirekickers or casual seekers. If you are marketing the high ticket item and are doing it properly, then you'll tend to get more serious inquiries.

    Overall, I think it's a better use of time.

    Less time wasted in filtering through the prospects and more money earned per sale.

    I sometimes hear people complaining that they get too many tirekickers even though they are marketing a high ticket item. I think if you are marketing 'correctly', then the system you have setup in place should and will automatically eliminate most of these folks.

  10. bkamanski

    bkamanski New Member

    I joined a free company and was given a beautiful website to promote their products. I received a $70 referral check and a $10 check for my second tier affiliate. Not bad for free? The only problem was the competition has much more in the way of resources to out market me. So I go on using free ads and traffic exchanges. It is a fun little hobby but I do not expect to retire on this particular program...

  11. TonyRush

    TonyRush New Member

    Part of the problem lies with prospects who don't know the difference between a "work at home JOB" and a "home based business".

    If someone is looking for employment....then, yes, I agree they shouldn't have to pay a dime. They should be provided with the materials they need to do their job and they should get paid based on their time or productivity.

    But, in a situation where someone is starting their own business? Absolutely there will be startup costs. Most companies DO charge a sign-up fee due to the fact that they're providing you with a certain amount of material and support to assist you in getting started.

    Bottom line....when you're talking to someone who's concerned about "free", you're probably on the phone with the wrong prospect. Merchant-minded people understand that legitimate businesses have expenses. And that there's no such thing as a business that doesn't involve spending money.

    Tony Rush
  12. lionsault

    lionsault New Member

    There are too many 'gurus' and 'programs' out there that claim that they can help you to earn easily. Many people will try out all these programs and get disillusioned after awhile if they did not see the cash coming in after a few weeks.

    They fail to see the point that a home based business takes time to see results just like a traditional business. The only difference is that the start up cost is lower and hence you have to incur some expenses initially. If you can start up for free, then there is indeed something wrong with the business. Lastly, most of these home based business programs have high drop outs because there is a lack of local support from the founders of the programs.
  13. malibumentor

    malibumentor New Member

    I have observed in hiring salespeople on strict (very BIG)
    commission basis.... most flake out.

    I have never had a single "associate" (somebody who comes in
    at the "basic" level) in my big-ticket programs actually produce
    any resluts or sales.

    Which leads me to conclude...

    Without INVESTMENT there is no COMMITTMENT.

    WHile there may be exceptions they are rare. When we invest
    financially in our own success, we invest emotionally as well.

    When there is no financial investment there is usually little
    or no real emotional investment in success.

    Its more like, "Oh, I'll give it a try, maybe this one will work..."
    type of thinking, generally...

    ...which seldom produces results.
  14. mountainmom5

    mountainmom5 Gold Member

    Getting started in your own business for nothing....

    Reminds me of the guy that sits in front of the stove and says, "Show me some heat and I'll throw you some wood!"


    Interesting Subject,

    No doubt, we all know the power of the word FREE if you have been around the marketing industry for any length of time, but how often is FREE......Really FREE? Hardly at all, so if you have a FREE business opportunity, as in, everything is FREE, no monthly costs or fees, no cost for marketing website or back office, then, and maybe then, it is worth checking out.

    I have researched thousands of home businesses, as well as traditional businesses, and FREE is not available with almost all, until now. Amazingly, I found one that was FREE, no hooks, no catches, no suprises, and we have all been down that road before.

    Simply put, I have always maintained that anything for FREE is not worth having, but like everything, times change, so maybe a few businesses will figure out that offering a real FREE business opportunity, they may end up with more success because of it.

    How many people have been burned on supposedly FREE deals? Most have us have. How many home businesses are really FREE?
    Most are not. I would rather join a business for FREE and then spend what most others are charging on my own marketing and advertising efforts, and wouldn't that end up helping everyone, you, the distributor, and the company alike? Of course it would, and that is the reason more companies will be looking at the FREE offers in the future, especially in recessionary times like these.

    Never pay to play is my opinion. If your product or serice does not have value without the business opportunity, then don't waste your time unless you have a huge organization already and you make money on recruiting others into deal. These are the only people that make the big money, but what about all the rest of us, shouldn't we have the same opportunity to start, make the same commissions as those who bought their position in company like so many so called front loaded deals promote.

    The home business industry is about to explode, and with so many to choose from, all I can warn you about is be careful, don't pay any business opportunity to sell for them. Sales are the backbone of all businesses, so why do so many companies want to charge a distributor to sell their products or services? I can understand company supplied sales and marketing materials, but not for website, back office or support. These should be FREE.

    Good luck to all, Mike
  16. ateamfuntimer

    ateamfuntimer New Member

    I know it sounds odd but yes there is an opportunity out there that is totally free. Ive created it. Now the reason I was able to do this is because ive had alot of experience in many opportunities.

    Here is what ive learned. Many opportunities say free but you must buy systems or products to run them. It's great that many opportunities have systems. It makes it easier for the person with no internet skills to get started. But what if you can create website? What if you know how to format video ( its easy these days with YouTube and Google). If you create a blog and added links to video and lead capture pages you could create your own marketing system for free. There are even free or inexpensive autoresponders you can use to follow up with those leads.

    Now having learned all this I did exactly that. I created a free opportunity to piggy babk on my paid opportunity. Now there can be no excuses if someone is serious about getting started. They can even get free MLM leads to start and practice on until they learn to generate their own targeted leads.

    To conclude many opportunities do talk about free trials. I suggest creating your own opportunities. We all got into the home based business arena to become our own bosses. We joined organizations to take advantage of the systems and support they already had in place. Well learn all you can from those opportunities and create your own niche ( if that is your desire). If not there are many opportunities that are free out there. Social networks are great. Use them to build a ist then find a simple set of products and market them to you list. Its a system that works.

    Adam Frederick
    Coastal Level III Director
    Founder of A-Team CV FREE Apprentice Program
    302 327 6263
  17. FreeCashMan

    FreeCashMan Well-Known Member

    You all make some good points. I saw Verizon Wireless advertising one of its new phone gadgets as free after the rebate...does that count as free in your eyes? Companies have been doing that for years.

    However, the way I see it; There Is No Free Lunch....Until You've Had The Pleasure of Enjoying One. [​IMG]


    malibumentor: I have observed in hiring salespeople on strict (very BIG)
    commission basis.... most flake out.

    I have never had a single "associate" (somebody who comes in
    at the "basic" level) in my big-ticket programs actually produce
    any resluts or sales.

    Which leads me to conclude...

    Without INVESTMENT there is no COMMITTMENT.



    Very often in the home business arena, what is free is not worth anything, and sadly, this has nothing to do with the value of any business.

    Commitment is not based on investment of money, it is based on investment of time. Time is money, but most don't know how to invest their time, thereby never make a dime.

    People have to wake up and learn how to earn for themselves for no one will do it for them. I have seen the top salersperson fail in their own business while I have also seen a complete newbit excel on time commitment alone.

    I just got off phone with a tow truck driver and mechanic who recently joined my team, and he had tons of questions, and this was his first venture into his own business at 41. The first few weeks, nothing, and he had no money to invest, yet all of a sudden, one sale, then another and another and he now has enough to become fullly qualified with his own purchase.

    Free does work for some people as mentioned, but then again, nothing will work for those that don't work. You have to invest time in everyone equally for you just never know who knows who and who will be your shining star. I won't nothing more than to see this person make it big, and now I know they will, and that is what makes this industry worth it.

    Good luck to all, Mike
  20. PMHayes

    PMHayes New Member

    I think you are all missing the real point. Nothing, and i do mean NOTHING is free. The cost may not be monetary, but there is still a cost. What is the cost, you might ask? The most important asset of all, YOUR TIME. You can get your money refunded to you if, say, you buy an item and it's faulty, or if you buy something with a money back guarantee. My business opp offers a triple your money back guarantee and the company honors it. But, you can never get back your time. No matter if an opportunity is "free" to start, or requires start up fees you still pay. Now i don't know about you, but my time is valuable to me. What this means is there is no FREE business opportunity, even if it doesnt cost any money to get in. It still costs you your time, a small piece of your life you will never get back.

    So, my advice to someone thinking about heading down this road, and to a potential business partner (prospect) look for the opportunity that will be worth the single greatest investment you will ever make. Is it worth your time? Maybe I'm a bit wierd, but the question i would ask is, how long does it take the average distributor in your business to go from being in the red to being in the black? Now this assumes quite a lot, i know. Not all distributors work as hard or as smart. Not all of them follow the plan, the training, not all of them duplicate. Some come in with more money to throw at advertising, and so many other variables.

    But if you get rid of the cream of the crop and the bottom dwellers and just focus on the median, the average distributors, you can get a feel for how long with a reasonable amount of effort it will take to turn a profit. And that my friends is more important to me than how much money will it cost me. If i go broke in a business, i can regroup, take a j.o.b., recover and try again, with another opp. But i can NEVER get back even one fraction of one second of my life. It's gone, forever!

    All things being equal, with perseverance, determination, motivation (a strong enough "why") and the belief that what you are "selling" can make someone's life better, one can succeed in any opportunity, whether it cost $1000.00, or $1.00 to get in, whether you are selling a few high ticket items or a slew of cheap ones.

    Then it comes down to, do i believe in what i am doing. Business is about making people's lives better, the customer's and the seller's. So, if I am going to invest my greatest resource, a piece of my life, It's more important to me to know how much of that resource I'm going to have to invest, than how much money I'm going to have to invest, and if the product, service, whatever makes it a worthwhile investment to start with.

    What's the point, here? One simple thought. The real hidden cost in any "Free" opportunity, but as well, in opportunities that do have start up costs, is YOUR TIME, therefore YOUR LIFE.

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