Despite attractive earning opportunities, MLM companies often face difficulties in retaining their distributors. More than 50% of them leave during the first year of cooperation, which becomes a major challenge for maintaining stability and developing a network business.

What prompts distributors to leave MLM companies

Formally not being an employee of the company, an MLM distributor works as an independent brand representative. In conditions where people have begun to value remote work and flexible schedules, it is not surprising that they are actively interested in a career in network marketing. Today, the MLM industry already counts more than 182 million independent distributors.

By improving understanding of direct sales counterparts and studying the reasons for their departure from MLM, network companies will be able to find ways to retain them in greater numbers. Successful retention of partners ensures a process of continuous sales growth and increases the profitability of your business.

Based on survey data from over 500 distributors who left the MLM business, 5 key reasons for their departure were identified:

  • Weak Communication

Communication is the cement that builds any relationship. Poor communication becomes a reason for the loss of employees in companies of all kinds, not just in the MLM sphere. Good communication allows distributors to receive clear information necessary for successful operation within the business structure.

Communication often breaks down due to issues such as:

  • Lack of communication: many distributors felt that due to the low level of communication, they were vulnerable and could not obtain useful resources when they needed them. If partners communicated more often with each other in a supportive manner, they would feel more comfortable continuing their career.

  • Misrepresentation of products: some distributors left MLM companies feeling that the products did not match their description. For effective sales, partners must have a clear understanding of the products from the very beginning.

  • Confusing information: Confusing marketing information or complex reports on work performed made distributors feel uncomfortable.

It is important to take communication as seriously as the products you sell. Your MLM company may have the best products and compensation plan, but if your communication is not clear, you will not be able to achieve the desired growth.

  • Lack of Desired Results

Often, distributors sign up with MLM companies with great enthusiasm, aiming for success. When they encounter unmet expectations, their enthusiasm quickly fades away.

Most of the surveyed distributors said they worked hard but did not achieve financial results. Others admitted their financial expectations were unrealistic. Interestingly, some distributors did not believe in their success from the start - such negative expectations could also affect their experience.

Less than 25% of distributors emphasized that they put maximum effort into their work, while 50% confessed they did not truly try hard. A lack of effort in MLM business inevitably leads to a lack of success - and this aspect remains one of the main reasons distributors leave.

  • Gaps in training and support

60% of surveyed distributors noted a lack of received training, emphasizing the need for more of it and greater support from the company and their team leader. Up to 30% of distributors stated that after joining the network, they did not communicate with their team leaders. Most likely, such oversight by management was not intentional and was caused by the absence of a clear system and established processes.

In 90% of cases, the lack of support becomes the key factor in the decision to leave the MLM business. This is a striking statistic that points to clear opportunities for improvement in retention. Network partners also mentioned that they expect more leadership from team leaders. With improved leadership and support, more distributors might have stayed in their positions.

  • Lost beliefs

The lack of belief in the products often forces distributors to sever ties with MLM companies. Upon closer examination of the products and observing how customers perceive them, many distributors lost motivation. It was difficult or impossible to promote products they did not believe in themselves.

The breakdown of beliefs was not only caused by disappointment in the products. At the time of their departure, some distributors continued to believe in the quality of the product they were promoting. Instead, they pointed to a loss of trust in the company's promises about rewards or support.

It's entirely possible that with stronger support and mentoring, many distributors would have lasted longer and overcome the initial difficulties that led them to lose faith. By providing their partners with more support and contributing to their success, companies increase their retention rate.

  • Life changes

Life changes among distributors prompt them to reduce their activity in the network, pushing sales and structure expansion to the background. Naturally, any industry can experience employee loss due to changes in their lives. However, one of the advantages of MLM is the flexibility that being a distributor brings, allowing for easy adaptation to changes in personal life or relocation without leaving the company.

Moving, changes in personal life, and other life circumstances can be reasons for breaking partnership ties. Such changes, although capable of causing temporary interruptions in sales, should not lead to departure from the MLM business. Network companies need to focus on flexibility and develop a suitable support system that allows partners experiencing life changes to continue working.

How to retain distributors in an MLM company

Thoroughly analyze your business's potential for improvement. Afterwards, you can build a company and culture that provides more reasons for people to stay with you. Genuine leadership creates a culture that attracts the right partners and loyal customers.

For motivation and increased productivity of distributors in MLM business, it is critically important to:

  • Improve leadership skills at the team leader level. Leaders' focus on establishing communication, improving the communication system, and providing quality support, especially for newcomers, is a key factor in preventing partner attrition.

  • Ensure full transparency regarding the reward system and accurate information about products from the start, so that sales representatives have a clear understanding of the terms and opportunities of their work.

  • Create a quality and comprehensive training system that will help distributors gear up for success in sales and achieve high results.

In the MLM business, there are numerous strategies to prevent the loss of valuable distributors. If your company is experiencing a high level of distributor turnover, then it's time to invest in solutions to retain talented partners. Ultimately, the success of network marketing companies depends on their distributors who promote products and expand the network structure.

The FlawlessMLM team has extensive experience in developing and launching successful MLM projects and knows how to create an environment for high retention of network partners. Follow the link to receive a free consultation from our experts in the chat.