Eiro Research just announced that they are filing for bankruptcy, and have officially ceased all operations. Eiro Research is a very popular Multi-Level Marketing (MLM) business that began operations in 2009. This is a company that gained extreme momentum, and very quickly became a multi-million dollar enterprise. Less than two years later, they are shutting their doors. Why did this very popular MLM business fail, and what does this mean for you, if you are a Eiro Research Distributor?
Why Did Eiro Research Fail As A Multi-level Marketing (MLM) Company?
Multi-Level Marketing, or commonly referred to as MLM, has one major strength, but unfortunately, it is only a strength for the company itself, not for the individual Distributor who is attempting to build a profitable business. MLM is one of the most effective ways for a new company to gain popularity and momentum, allowing them to quickly achieve early growth and profitability. Companies that employ a MLM business model know that the general population possesses a substantial network of family and friends, and MLM companies exploit this fact. They just simply get you excited about their product, and more importantly, the business opportunity that they offer, so that you will happily go out and promote their products to everyone around you. This method of advertising spreads like wildfire! Not only that, but MLM companies make you pay them for the right to promote their products. So, not only are companies like Eiro Research not having to spend advertising dollars to grow their name, they are making money when you purchase their Distributor Kits, along with the requirement for you to enroll into their monthly autoship programs. So, even if you are not making money, they are still moving products off of their shelves, and shipping them to your front door on a monthly basis. In the case of Eiro Research, they just simply needed to recruit a few heavy hitters, and they were off to the races, and growing at exponential rates.
However, with many newer MLM companies, this MLM concept can not sustain this level of growth or momentum. Why is this? Simply put, MLM does not work for the individual Distributor who is working like a dog to build their business. MLM companies fail miserably to teach their Distributors how to effectively ‘MARKET’ and grow their individual businesses. Sure, they will make you very excited and talk about the prodigies that are making 6 or 7 figures a year through living room presentations, home parties, and recruiting their loved ones. However, these methods do not work for the majority of those who are desperately trying to build their business. In fact, it is a proven statistic that 97% of distributors fail in MLM businesses. If everyone is failing, companies like Eiro Research are not making money. Sure, everyone has a large network of family and friends, but in many cases, your friends and family do not share your entrepreneurial spirit, or maybe they can’t afford to purchase a $40 bottle of juice, or a $100 bottle of weight loss pills, etc. MLM businesses require an unlimited amount of steady leads and new interest, and this can not be achieved through friends and family only. You will eventually run out of new prospects to talk to. Simply put, MLM companies do not teach you what is necessary to become successful.
This is the reason you see multi-million dollar enterprises all of the sudden closing up shop. With only 3% of their distributors successfully moving products off of their shelves, their growth and profitability can not be sustained. A company can manufacture the best products in the world, but if they are not training their Distributors to effectively sell their products, those products are going to collect dust on their warehouse shelves. This is the reason why Eiro Research has closed their doors. As with the majority of MLM companies, Eiro Research failed their Distributors.
What Does This Mean For The Individual Eiro Research Distributor?
Right now, Eiro Research is in the process of filling all orders, and compensating Distributors for those orders. These payments are going to consume the rest of Eiro Research’s remaining resources. Eiro Research is in the process of trying to find a third-party to purchase their trademark, website, and remaining inventory. If a buyout is successful, Distributors may have the opportunity to become distributors in the new company. However, many Distributors will jump ship to find another MLM company. This will be a simple process for many of the top producers who have built downlines of hundreds or thousands, as they will convince many of their team members to follow them. However, for those who were still in the process of building a substantial organization, this will not be so simple. Many will simply need to start over from scratch, in hopes that they have not joined another MLM company that will be filing for bankruptcy tomorrow.
The downfall of Eiro Research is very unfortunate, and my heart breaks for those distributors who have watched their hard work, commitment, and determination be for nothing, just to start over. When MLM companies fail, unfortunately, it is their Distributors who will ultimately suffer. If MLM companies do not change the way that they train and support their Distributors, we are going to see many more MLM companies just like Eiro Research closing their doors, leaving their Distributors with nothing but hard choices for their future.