Network marketing programs, also commonly referred to as MLM or downline programs, can bring huge financial rewards if marketed well. They provide a way of working at home and building your own monthly income through your efforts to introduce and sell the network marketing company's products or services to other people, who then introduce them to other people, and so on. It sounds simple enough but how do you know if a company is legitimate and will pay you on time or even at all, and will they be around in the long term?

In this article I have listed seven factors that I personally take into consideration before choosing to join an MLM company:

1. Are the products offered good enough to be sold on their own without the downline incentive?

The first thing you should look at is the products or services that the company is offering. If you don't believe they represent value for money, or you simply aren't impressed with them, then the likelihood is that other people won't be either. Therefore you will probably have difficulty selling the products to other people, and so your potential profits could be limited.

2. Has the company already established itself?

It's important to find out how long the company you're considering joining has been operating. Although there's no guarantees on whether a company will be around in the long-term, I still favour companies that are at least a year old. Yes some of these may subsequently go out of business at some point in the future, but at least you know they're not a fly-by-night outfit.

3. Does the company offer a good compensation plan?

Let's be honest, this is the factor that most of us are primarily interested in. Time is a very valuable commodity, so we don't want to spend it promoting a network marketing company's products unless we are being well rewarded financially for our efforts.

4. Does it offer spillover?

Spillover occurs when say for example, if the company uses a 5x5 matrix then when you refer 6 people, the first 5 will fill the top level, and the 6th person will go under one of your initial referrals creating an incentive for them to continue with the program because they are benefiting from your efforts as well as their own.

5. Does the company have a reputable owner or management team in place?

This information can be slightly difficult to find out, but in this internet age it is becoming much easier to carry out independent research. If you can't find sufficient information yourself you can almost guarantee that there will be a forum somewhere which discusses the company, and where someone has already done a background check on the owner or management team.

6. Is it strongly endorsed by other members of the company?

Forums and discussion groups are great places to obtain this information. Although most people will obviously praise the company that they are promoting in order to get more signups, you will inevitably find a few negative comments from disgruntled recruiters. It's these comments that you should read carefully. Most of the time they will be minor issues or faults, but sometimes you can come across red flag signals such as the company suddenly starting to delay payments, for example.

7. Does the company still have plenty of room to grow, or has it already reached saturation point?

This is the final point I want to mention, but nevertheless a very important one. You don't want to join a company that everyone is seemingly already a member of, and one that is already promoted heavily. For optimum results you want a company that has already established itself yet still has plenty of scope to grow and attract new members, therefore being relatively easy to promote.