This is the ability to get paid over and over for the work that you do one time. It’s also called “royalty pay.”
There are very few businesses or industries today that pay residual income.
Musicians, authors and insurance sales people are a few professions that do earn a residual income.
If you were to write or record a popular song, each time that song played on the radio, or a CD was sold, you would receive a commission, or royalty payment.
Residual income in Network Marketing is income you continue to earn based on efforts you put forth initially. This income is based on the sale of products and services. And, these products must continue to generate repeat sales.
This is one reason why “consumable” products are the most effective in Network Marketing. Consumable products are those items that are bought, used up and then replaced, over and over again.
If you are marketing a product that is a one time purchase product, you will have a harder time generating residual income.
Residual income is desirable in Network Marketing, because this is what allows you to put forth a lot of effort in the beginning, and reap the rewards of that for months and years to come!
And, by building an organization of people working toward a common goal, you can ensure a strong residual pay-out that will last for years. This is why it is important that you understand this pay advantage, and invest your effort, energy and time in other people.
Earning residual income requires a few things – first that you take action to get momentum going in your organization.
Second, you continue building on that momentum, and teach others to do the same.
Finally, you learn and develop leadership skills that will provide the foundation that supports your entire organization.
People follow people, and leadership skills are developed. Leaders are created, not necessarily born.
In the beginning, you have the “privilege” of working lots of hours for a little pay. In the end, you have the “joy” of working little hours for lots of pay.
People ask me all of the time how much I made my first month in the business. The answer is – “I don’t know. I don’t know because I still get paid each and every month on the efforts I put into that very first month.” That’s the power of residual income!
Get started and then build on your efforts each and every month.
Be a leader of others and watch the residual income roll in.
Here is Part 1 if you missed it! – What Is Network Marketing.
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