Network Marketing in the B Quadrant in Today’s Economy

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Cashflow Quadrant for Financial Independence at Ask Jimmy Johnson Network Marketing Success BlogRobert Kiyosaki’s explanation of how to achieve financial independence “Rich Dad, Poor Dad” has now become a classic read. His follow-up book “Rich Dad’s Cash Flow Quadrant gives an excellent breakdown of how to look at business as a vehicle to obtain wealth and freedom. If you are serious about building a MLM or network marketing business this book is a must read. In today’s economy it is more important than ever to be in some form of business. Even as a part-time business owner you will enjoy the benefits that many think only go to big business. The tax laws apply to all size businesses from the one person operation to the Fortune 500 corporation. The only difference is the size of the accounting team that maximizes allowable deductions. This is not tax or legal advice. The only advice I can give is to record expenses, keep receipts and get a good tax person to maximize your return to keep more money in your pocket.

Even if you find yourself in the E Quadrant (Employee Quadrant) you qualify for the same benefits as any entity in the B Quadrant (Business Quadrant). Yes, even if you work your business on a part-time or spare-time business. For many direct selling or network marketing allows them to make extra money which may make a huge difference in a household’s bottom line. Most personal bankruptcies could be avoided with little over an extra $300 coming in each month. For some the motivation to start a MLM business may be to get freedom from the schedule of a job or get into a position to get paid their true worth. You see your employer can only pay you a fraction of the value you bring to his company. Some people realize their value and potential and use network marketing as a vehicle to break loose and enjoy the freedom of a true business owner.

As Robert Kiyosaki explains, a true business owner owns a system. It is the system that runs the business and people run the system. It is a system that people purchase when they buy a franchise such as Dunkin Donuts or Sonic Burgers. They will pay tens or thousands of dollars because they are purchasing a proven success system that prints money for them. The same is available from network marketing companies at a fraction of the cost. The real expense is personal effort and time. The same expense employees are expending in a job anyway. The old joke that a JOB is Just Over Broke is not a funny one when you take the time to really look at how the tax structure is stacked against the employee but rewards the employer.

The employers has a price to pay in hiring employees who will never care as much about the business as the business owner will. Unfortunately employees have to be watched over at all times. The employee can walk away from a business at any time. The employer has all the skin in the game. The beauty of network marketing is that we have no employees. People who join us in business are just as interested in our success because we are interested in their success also. In MLM we want people to succeed and build their business within our business to be as large and even larger than our organization. That my friends is a true opportunity for anyone you invite to join you in business. We never fear training our own competition. The owner of a repair shop dreads the day his best mechanic decides to go out and open their own shop. So there is always the tendency of employers and managers to hold people back from too much advancement. In network marketing there is no glass ceiling. We support, encourage and applaud  the success of others.


The ultimate reason for going into business is to enter the I Quadrant which is the investor quadrant. These are the people who have set aside money on a regular bases and now have money working for them rather than having to work for money any longer. Most employees because they live from paycheck to paycheck will never enjoy financial independence. Statistics show that only five percent of the American population will be able to retire at age 65 without being dependent on family, charity or the government. A person would be wise if all they did was start a network marketing business and saved and invested the money earned from that business. The business itself can become an investment. Successful business including network marketing business can be sold to another entrepreneur usually for eight to ten times the income that business earns annually. Many success business are also passed on to children who want to carry on the “family business”. Do not become a statistic on the wrong side of the cashflow quadrant, find a business that excites you and then go work it as hard as you do for your boss, even if on a part-time basis for starters.



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  • Hi Jimmy!

    Great article explaining the cashflow quadrant. More people need to understand it. If they did, I am sure they’d made an effort to move to the right-hand side.
    I am always a little shocked at how many people spend their entire life stuck in the “E” quadrant. It’s very sad.

    “I” is definitely the place to be as you so well pointed out.

    Here’s to staying on the correct side of the quadrant!

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