Important Questions To Ask Vendors

MLMIA Teleclass Leadership Series

The following are  important questions to ask MLM software companies about their system:

✓ Has their software system been deployed and functional with a client that has over 1,000,000 distributors?
✓ How many transactions and sign-ups is their system capable of processing in a single day?
✓ How many users can simultaneously access their system?
✓ Do they provide a test system to run commission scenarios?
✓ Can they re-run commissions in live scenarios if necessary?
✓ How long will it take to run commissions with over 1,000,000 distributors, or 250,000, or even less?
✓ Does their system have the ability to do multiple compensation plans, currencies, languages, gateway/merchant accounts?
✓ Is technical support included in the monthly fees, or are there seperate support packages?
✓ What kind of support do they include….phone, email, ticket system?
✓ Do they provide API’s (Application Programming Interface) so clients can customize as needed?
✓ Do they provide an expert on compensation plans who can provide invaluable guidance?
✓ Is their system hardcoded or parameter-based?
✓ What is the experience level of the staff?
✓ How do I export my data if I want to change vendors?
✓ How are backups handled? How often can I get them?
✓ How long has their software been in existence?
✓ What commission genealogy structures are supported?

If their software system is less than 10 years old, there are many features and functions that the iMatrix system can handle which others can not.


1. Industry Knowledge: Lack of knowledge and experience in MLM industry by new company owners. Being familiar with MLM terms and procedures are very helpful. Do a lot of research and talk to industry experts.

2. System set-up: You don’t know what you don’t know. There are always many questions that need to be answered that you may be unaware of or not have even considered. Your software vendor should provide you insight so you can make an educated decision.

3. Training Tools: Not taking the time to understand and learn the training tools. This applies to companies and distributors. You need to promote various tools and train the members on them.

4. Computer literacy: It is vital to have someone on the corporate team who is computer literate for the set-up and thereafter. This is a common mistake with start-ups and can extend the set-up time indefinately.

5. Skipping Steps: Skipping and/or not reviewing or completing each step because you want to go live quicker. Making changes later can have negative consequences.

6. Just Get Going: Don’t worry about unique customizations and displays during set-up unless it is absolutely necessary for your business model. You can always add unique features later when you have more time and money.

7. Website: Depending on your objectives, don’t spend a ton of time or money on designing a new website. Use a website template and get going. Your website can evolve over time. Remember, no one will stumble across your website unless you spent a lot of money and time on your Search Engine Optimization and/or Advertising prior to your launch. It is highly unlikely your website will get a high ranking on the first page, unless you have a lot of money to spend on pay-for-click ads.

8. Operational Staff: Only focusing on the compensation plan and product and forgetting to employ an experienced person on staff.

9. Launching Before You Are Ready: This can cause product delivery and service issues, even when it’s a “service” product. It can also adversely impact the system and its features.

10. Making Hasteful Changes to theCompensation Plan: This causes the field to stop working and start trying to figure out how to manipulate the new plan.

11. Multiple Decision Makers: It is optimal to have a single individual make the final decisions who also has money invested in the company. Too many decision makers will delay set-up, cause conflicting goals, and create dissention. Once the company starts making a lot of money, conflicts typically begin others perceives they work harder and they should get more money. Ideally, have an pre-arranged plan for decision making and owner compensation before you launch the company.

12. Inadequate Financing/Underfunded: Not having enough reserves to cover operating costs for at least 6 months after launch. 12 months is optimal.

13. Product or Opportunity: Decide if you’re an opportunity company or a product-oriented company and proceed with that positioning. It can be challenging to succeed as succeed.

14. Distributor Training: Lack of thoroughly training your distributors and not having consistent or constant training for all levels.

15. No Compensation Plan Expert On Staff: If the MLM software vendor does not have a highly experienced compensation plan expert who is on staff and can provide invaluable input, then you need help. This is also  important in the future when you are considering changes and additions.

16. Promises: Don’t make promises you cannot or do not intend to keep. Do not announce or promise a date to the field for anything that is not developed or tested.

17. Keep a positive attitude: Perception is reality in the MLM industry. Let it be known that everything is going great. You can acknowledge issues, but keep the message positive! The MLM business is a hotbed of rumors.

18. The two golden rules: Deliver your products or services, and pay commissions on time!