Why do most MLM brands prefer health and wellness products?

MLM is a business model that harnesses the power of community networking and genuine recommendations for increasing sales distribution and revenue. Interested distributors first understand the plans and income potential buy the products and use them. If the business model and product quality seem promising they start recommending the same to others. The business works on a revenue-sharing model for each sale. Two USPs of MLM businesses are the merit-based calculation of revenue-sharing plus assured perks based on specific milestones about which we will talk later.

If we look at the history of the MLM industry, two factors can be discerned- emphasis on direct one-on-one communication for selling products, and secondly a keen inclination towards wellness and health products to nurture good health and combat diseases. Even a glance at the list of most successful MLM companies reveals that the top spots are occupied by health and wellness brands. A majority of MLM generally outsource the production process to third-party healthcare products manufacturing units.

In this article, we will talk about two major factors.

  • · Number one– What makes the health and wellness industry the preferred target for MLM companies?
  • · Number Two– The ideal qualities of third party herbal products manufacturers

People are ready to spend more on their health

The statistics show that over the period of 5 years people have increased their health expenditure.

In this digital age of ever-growing competition, life is becoming increasingly hectic and its effects on people’s health are visible. A large portion of the global population is affected by issues like insomnia, depression, and chronic stress. It is not the ideal condition and people are desperately looking to improve their life quality.

Digitization has made people health-conscious

Besides, the digitization of information has resulted in an abundant awareness about health issues as well as relevant prevention and cure solutions. This increased consciousness has generated a thriving population of people who are inclined to spend liberally on health products provided they are genuine, safe, and effective. So, selling health and wellness products helps MLM companies in 3 ways.

First, it allows them to tap a ready market of health-conscious consumers.

Secondly, people are more likely to try health products that are recommended by their doctors, friends, or family- rather than the ones sold through advertisements on popular mediums- something which makes these products a perfect fit for the preferred selling method of MLM business, i.e., peer-to-peer recommendation.

Thirdly, human beings generally tend to advocate for the products, services, and ideas that bring about a transformational change in their lives. With the right health products, a person can overcome major health challenges, say, and insomnia and resultant chronic stress. Such consumers are likely to vocally advocate the product and help in the growing organic community of consumers and MLM distributors.

People are looking for more personalized ways to improve health

In many countries the citizens are not satisfied with the healthcare options and distrust in the formal medical industry is also on a rise. Besides the deficit in skilled healthcare workers has made the situation worse. Talking about figures, by 2030 this deficit will grow to a scale of 18 million health workers- as per a report by United Nations- published in British Medical Journal. Along with obvious staff shortage, this deficit has also increased the burnout instances due to overburdened professionals.

Due to this situation, an increasing number of people are being denied personalized care specific to gender, physical constitution, and routine commitments. In short, a majority of people are simply frustrated with formal healthcare facilities and they are looking for other alternatives. By providing well-researched health and wellness products the MLM companies can fill this gap. Unlike understaffed healthcare facilities, the MLM companies have a thriving community of distributors. As opposed to generalized treatment, the MLM company distributors can work with nutritionists to offer personalized medicines/dosages that align comfortably with a person’s commitments and schedule. These factors add more value to their business thus making it easier for them to attract more consumers and distributors.

It is not just a passing trend

The current growth in the healthcare industry isn’t just a “bubble”. A study shows that the wellness economy registered a growth of 12% during the period between 2015 an2017 and there are strong indicators that this trend will continue and increase with time.

 As opposed to the lifestyle industry, the healthcare and wellness industry is primarily based on needs, not desires. One can neglect or regulate desires but needs are always given the priority treatment which means that the increase in need-based sectors like healthcare business has deeper traction when compared to desire-based sectors like lifestyle products.  

Increasing health benefits/perks for working population

With increasing awareness about health and care, a growing number of employers are keen on investing decently in the healthcare perks/benefits of their employees. Right from internet giant Google to the growing technology start-ups and SMEs, more corporate entities are increasing the scope of health-related perks. It has increased the affording power of the working population- when it comes to health-related products and services. It has started a new consumer segment for the health and wellness sector.  

Now, we come to the second part- the ideal qualities of a third-party health and wellness products manufacturer 

To deliver the best quality products with sufficient anytime stock availability and at the right pricing, you need to hire best-in-class third party manufacturing units:

The right type of infrastructure

The third-party manufacturing units have the right type of infrastructure and sophisticated machinery/equipment to produce the desired herbal supplements in large volumes. They have an entire mechanical ecosystem for processing, extraction, pulverizing, refining, and setting the raw materials using precise quantity, right timing, and following other guidelines. It results in accurately-prepared supplements in a ready-for-sale format.

Complete range of services

People assume that all third-party manufacturers offer end to end services by default and many of them discover nth moment surprises. To avoid frustration, confirm all the specific services that they hired third party manufacturing unit offers you. It should ideally include all the factors/services needed for retail selling of the product like printing, designing, packaging, and even shipping.

Right Pricing

Pricing plays a vital role especially when we talk in the context of the MLM business model. A large part of MRP is distributed to several distributors. So, to sell products at reasonable prices without compromising on profitability, it is very important to get the items manufactured at the lowest possible prices. Make sure that the manufacturer is ready to provide you the finished products at highly competitive rates that allow you to maintain the right balance between reasonable pricing and profitability.

Qualified business consultancy

Starting your line of herbal products requires you to do lots of market and competitor research which needs business expertise along with skilled manpower. However, when you appoint the right third-party manufacturers they provide you the required pre/post production assistance including the right product selection, proper presentation, market trends, etc. So, you can harness the benefits of their long-term industry experience which increases the probabilities of a good market response.

Research and Development It is equally important to ensure that the manufacturing company also invests decently in R&D tasks. As already discussed, you need to win people’s trust to increase the number of customers and convince them to become your distributors. Well-researched health products place you in an advantageous position and mentioning such things on the packaging encourages more people to buy your products.

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