The announcement of a direct sales or network marketing company pre-launch inevitably leads to a flurry of activity in the work at home moms online community. The promise of “getting in on the ground floor” and the potential for growth and profit seems irresistible and many will sign on as fast as they can. But is it wise to jump on a pre-launch? Maybe not…

All business is risky, but a pre-launch is particularly risky simply because without a history it’s difficult to evaluate the company’s management ability and staying power.

While the commonly held belief that 80-90% of businesses fail within the first year or two is probably not accurate, it is probably true that just as many new companies will fail as will succeed.

While there are no guarantees, a well-established company is less risky and may offer as much room for growth as a new company.

Before you join a pre-launch, consider these points.

1 – Product quality and availability

Some companies begin pre-launch before product is available. Are you willing to begin marketing the company before you’ve tried out the products?

How well has the company planned for that first burst of product demand at launch? Will you and your customers be disappointed if you have to wait weeks or maybe even months to receive product?

Consider what will happen if you or your customers are disappointed in the products or delivery time.

2 – Changes

Pre-launch companies are likely to undergo many changes before and just after launch. Are you flexible enough to deal with changes, including major policy change?

One particularly disappointing change that has occurred on more than one occasion recently, is a change in online marketing policies. A company that starts out encouraging online marketing in pre-launch may decide to restrict or eliminate online marketing at launch.

3 – Timing

Find out when the company expects to launch and what how much has to be accomplished before launch. How long are you willing to promote the company before launch and how well can you deal with delay?

4 – Will you gain enough from the pre-launch to compensate for a failure should it happen?

Will you learn new marketing or recruiting skills during pre-launch that will benefit you in your other businesses or a future endeavor?

Will you be able to build team loyalty to you, and not just the company, so that your team will follow you to another business if necessary?

5 – Will your reputation survive a pre-launch failure?

Many people jump on a pre-launch because there is little or no financial cost to doing so. But there’s more at stake than financial risk. In addition to the time and effort you’ll put into a new business, you are risking your reputation. As a direct seller or network marketer, a major asset is the trust your team and your customers place in you. Evaluate the risk of losing it.

Joining a pre-launch may prove rewarding in the long run, but don’t jump into one without understanding and evaluating the risk.

Linda Stacy manages several online resources that help direct sales consultants generate leads and build their teams. For help choosing and marketing your direct sales opportunity, visit http://www.directsalesdirectories.com.