The Funded Proposal Let me explain the concept of a funded proposal with an example.
You're a network marketer. You want to sponsor new business associates, and you decide to advertise. You'll create a web site, but you need a good plan.
If you take the most direct approach, selling your opportunity, your cost per acquisition will be very high, since very few visitors will buy.
High advertising costs will put stress on your cash flow and squeeze your profits.
Instead you sell an inexpensive yet valuable network marketing book. Sales of this book generate enough revenue to more than cover your advertising expense. You make a profit before even one person buys your opportunity and joins your team.
You follow up with phone calls to the purchasers of your book. A percentage of these highly targeted leads take you up on your business proposition. Your marketing is profitable.
Since book sales more than pay for your advertising, you can advertise on a large scale and generate immediate cash flow from book sales.
This marketing technique has been around longer than I have, and it's just as valid today as it was in my grandfather's time.
Here are a couple of reasonable examples of funded proposals:
Magnetic Sponsoring
The Renegade System
Frontloading
You decide to participate in a network marketing program.
Your new sponsor strongly encourages you to buy a larger quantity of product than you can reasonably expect to use or sell.
Your sponsor explains that you'll need to have plenty of products on hand, since the more products you have, the more you'll sell.
Or your sponsor explains that this is a business of duplication, and what would you like to duplicate, high volume and commissions or low volume and commissions.
Either way there's a reasonable likelihood that you'll find yourself with a proverbial garage full of water filters.
This practice is unethical and generally speaking illegal. It still exists but to a lesser extent than in the past, since books, newspapers and government agencies have created greater awareness of this kind of trap.
If you find yourself in this situation down the road, say no and run in the other direction.
Get Paid Today
Now let us have a look at the darker side of funded proposals.
Consider the possibility of buying a pricey training program to teach you some special success formula or Web 2.0 technique that will bring you an incredible number of prospects and signups into your new or existing program.
The sellers have already concluded that they could invest a lot of their time in you, but it probably won't be worthwhile. You will underperform. So they sell you an expensive course, so that they can make all the money on you up front!
They "get paid today".
They assume that you will be unsuccessful and are therefore frontloading you to the max. And funny thing is, this is probably totally legal. They are selling you a training program, and you are buying a training program.
They're also looking to lure you away from network marketing and convert you into a direct seller just like they are.
Before you buy into a G.P.T. program, be sure that you can afford to lose your investment. Depending on your sales skills and the quality of theirtraining program you may or may not ever recover the price of the program.
