Wednesday, August 25, 2010

Wholesale Buying Organizations versus Retail Selling Organizations

There is a HUGE difference between these two organizations - don’t mix them up.

A Wholesale Buying Organization is an MLM business that recruits people to purchase products at wholesale prices from the MLM company. There is no emphasis on making a lot of money.

A Retail Selling Organization is an MLM business that recruits people to sell products to a consumer and also to recruit others to do the same. A lot of money can be made.

The main difference is the “sales pitch” and what the distributor’s activities are after the pitch.

If the sales pitch is about achieving wealth and time freedom, then that can only be achieved with a Retail Selling Organization. It has been achieved in a Wholesale Buying Organization, but requires approximately 5,000 customers purchasing the products to produce a $5,000/month bonus check.

If the MLM company is a Wholesale Buying Organization, the “sales pitch” should be about earning extra money. Notice that the pitch is NOT about wealth and time freedom. You can expect to purchase products at a discount and, after several others have joined, you may make enough extra money to pay for your products. After a few hundred people in your downline, you may be able to earn a car payment. After a few thousand people, a house payment. But a Wholesale Buying Organization is not the way to achieve wealth and time freedom.

Sometimes distributors in MLM companies mix these two organizations together. A distributor may be told to get customers to purchase products at wholesale prices by using a “sales pitch” about wealth and time freedom. This is the activity of a Wholesale Buying Club! Because there is no focus on getting and training new distributors, the “sales pitch” about wealth and time freedom is not accurate.

It may not be “illegal” to do this, but at a minimum it is misleading to suggest to someone that they can reach financial freedom doing wholesale consumption activities… unless you tell them it will require them to have thousands of customers.

The correct activities of a Retail Selling Organization are recommending that the new person purchase products (they should do this so they know they like the products), training them to get new customers, and finally teaching them to recruit and train others to do the same - these activities can and have produced “wealth and time freedom”.

If you see that your company is confusing these two organizations, you need to correct it with the people you recruit. Blaming your upline for not training you how to get customers does you no good. Just learn it on your own and then teach your downline. Soon you’ll be a top producer and everyone will want to know how you did it.


If the “sales pitch” is earn wealth and time freedom = Retail Selling Organization. Activities are: Buy products for yourself and get trained on how to sell products and recruit others to do the same.

If the “sales pitch” is earn extra money and get products at wholesale prices =
Wholesale Buying Organization. Activities are: Buy products at wholesale and get others to do the same. Do not expect wealth and time freedom.

Do not confuse these two organizations.

Tim Sales built an MLM business with an income of over $150,000 per month with 2,400+ new distributors joining per month. He now creates MLM training tools and sales aids for everyone in network marketing. To discover Tims' proven network marketing ideas and strategies that will grow your MLM business faster, visit