Creating a side income is a great way to boost your monthly income. More than likely you have been considering selling MRR products or doing MLM. I have tried MLM in the past and am currently considering MRR. I will compare the two by doing an MRR VS MLM comparison.
How’s it going? My name is Eartha and I created this website to share my passion for online businesses. I got my start with affiliate marketing and it remains one of my favorite ways to make an income online.
MRR or MLM? That’s what I’ll be covering in this post. I hope that the information here may help clarify how each business model works.
Summary of MRR VS MLM
| Factor | MRR (Master Resell Rights) | MLM (Multilevel Marketing) |
| Definition | A license agreement to resell the product and pass along resell rights to others. | Independent distributors sell products and recruit new distributors to earn a percentage of their recruits’ sales. |
| Product Control | You’re able to price your product at the same price you paid or higher. | Products and pricing are controlled by the MLM company. |
| Revenue Model | You earn income by reselling the product. | Earnings are the result of personal sales and the percentage you earn from your downline. |
| Initial Investment | Buying the MRR product. | Usually involves buying a starter kit and a monthly minimum purchase. |
| Risk Level | Low since your main investment is buying the product. | High because you have to buy products monthly and maintain a sales network. |
| Focus | Marketing and selling the MRR product. | Selling products and recruiting distributors. |
| Growth Potential | Limited to high as it depends on the demand for the product. | High as you can earn from sales and your downline. |
| Reputation | Depends on how high quality the product is. | Often controversial due to the focus on recruitment. |
Table of Contents
What is MRR (Master Resell Rights)?
You may have only recently heard of MRR but it is not a new business model. It has been around for many years. MRR stands for Master Resell Rights.
Many years ago, MRR products were primarily PDF files. Today, many MRR products are full-on courses with modules and several training videos within those modules.
When you buy an MRR product, you are also buying a license to be able to resell that same product and keep 100% of the profit.
The license may even allow you to modify the product by adding to it. You can also pass along the master resell rights to your customers.
MRR Pros
There are many advantages to starting an online business with MRR products. Here are some that stand out:
You don’t have to create your own product – There is no need to start from scratch with product creation. You get to leverage another person’s product to begin making sales.
Keep 100% of the profit – You don’t have to worry about commissions as you get to resell the product and keep 100% of every sale you make.
Sell worldwide – Since you’re dealing with a digital product, you can sell it worldwide without worrying about packing and shipping anything.
MRR Cons
You’ll have to set up a payment processor – Because you are selling a product of your own, you’ll need to have a payment processor and a platform to sell it on.
There must be customer support – You’ll also need to provide an easy way for your customers to contact you when they have questions or concerns.
Possible refund requests or chargebacks – Although your product may be digital and you state that there are no refunds, it’s still possible that customers request them.
What is MLM (Multilevel Marketing)?
Multilevel marketing is a business model where you are an independent distributor for a network marketing company.
As an independent distributor, you make money from the selling of products and by building a downline of other distributors (your network.)
MLMs have been around for a long time and there are tons of network marketing companies to choose from.
MLM Pros
People join a multilevel marketing company every day. There are some advantages to this business model such as:
You don’t need to create a product – It’s easier to get up and running because you can leverage the products of the company.
Plenty of training and support – Network marketing companies are known to provide training videos and support to help you grow your business.
MLM Cons
Recruiting can be a challenge – Building a downline is a big part of any MLM. It can be a challenge to sell people on the MLM business model.
Monthly costs – Almost all multilevel marketing companies require a minimum monthly purchase of products.
Negative reputation – Many people are aware of MLMs and some may feel they are pyramid scams.
MRR VS MLM – Which is Ideal for Beginners?
Selling an MRR product is going to be easier than starting with an MLM for various reasons. Let’s begin with start-up costs. With MRR, you only need to buy the product and you’re able to resell it.
When you’re starting with multilevel marketing, you usually have to buy some type of starter kit as well as order products monthly. It can be costly when you’re starting.
Also, when you’re selling a master resell rights product, you don’t have to focus on recruiting and building a downline.
Another plus with MRR is that the products are digital. Therefore you can run your business 100% online.
Be sure to read about MRR VS Affiliate Marketing as well.