Residual Income is the money you earn from a project after the work to complete the project is done. Things like royalties, dividend income, revenue from sales of a product you created in the past are examples of residual income.

It is the grail.

Residual Income comes from production

In Network Marketing, residual income is earned from the production of your sales team. You do the work to sponsor and teach someone how to find customers and build a team. When that person is self-sufficient and building without you, you continue to earn residual income from that team’s sales even though you are no longer working with them on a day-to-day basis.

Do that 5 or 6 times and you can build a significant income that will continue regardless of your own continuing efforts.

The beauty of this method of creating residual income is that it takes time and effort, but not much in the way of capital.

You can start a Network Marketing business for a few hundred dollars, have an overhead of maybe a couple hundred per month, and have the potential to earn a serious income.

Anyone can do it. Most don’t.

Can anyone do it?

Theoretically, yes.

The skills required are not complex and are learnable by most anyone.

Why then, do most people fail to accomplish what they set out to accomplish when they get started in Network Marketing?

The same reasons most people don’t sell a single house after they get their real estate license or never write a policy after they get their insurance license. There are a lot of No’s on the way to success and most folks don’t have the ability to get past that. They personalize the rejection and get paralyzed by the fear of another no.

Also, with Network Marketing, one must be able to work with an understanding of delayed gratification.

It takes persistence.

For the first several months, there is not a huge amount of volume going through a team. Commissions are small. It takes a strong commitment to one’s vision of the end result to keep working now when now’s income could probably be beaten by a part-time job.

Building a Network Marketing team is kind of like the old adage about doubling a penny every day for a month.

If you quit after the first week, you only have 64 cents.

After two weeks, $81.92

After 3 weeks, you’re still only at $10,485.76.

But at the end of a month, that penny has been increased to $5,368,709.12.

exponential graph

How does geometric growth work?

With a Network Marketing team, if you sponsor 1 person in your first month, there are two of you. Since we usually deal in smaller ticket items in Network Marketing, there isn’t going to be a lot of volume there.

If you each sponsor a person in month 2, you will be a team of 4.

8 in month 3.

16 in month 4.

But if that trend continues, by the end of month 12 you will have a team of 4000.

Most people will give up long before they reach that point.

They don’t understand the long game and they don’t understand residual income.

Let’s assume that things don’t work out perfectly. (Big surprise there, huh?)

Instead of 4000, you only manage to build a group of 800, or 20% of the model.

You have a team of 800, who each have a small customer base and let’s say they average $150 in volume. 800 x $150 = $120,000 in sale volume. In most Network Marketing companies, you’ll average about a 6% commission on that volume, which would be $7200.

Time and tenacity can create residual income.

That’s what it can build to with a little time and tenacity. And that money will keep coming in month after month, whether you are working day-to-day with those people or not. Whether you go to work or go to the golf course.

That’s residual income.

That’s the reason to persist and not take the no’s personally.

You’ll work a lot harder than you get paid for in the beginning. But if you persist, you will be paid for work you don’t even do.

If that sounds interesting to you, let’s chat.

I’ll be glad to have a conversation with you so you can decide if this is something that would be a fit for you. No hype, no pressure and no BS.

You can book a call on my calendar here:

If you want to watch a short overview video first, you can do that here:

Steve Norris
Steve Norris

After spending many years thinking I owned businesses when those businesses actually owned me, I learned how to own a home-based business that truly is based from home. My business now supports my lifestyle rather than my life going to support my business.