Network marketing vs affiliate marketing vs franchising

Three different structures

These models are often lumped together, but they differ in cost, control and obligation.

• Affiliate marketing: you refer customers to a company's products and are paid on referred sales. Usually low cost, no team structure, heavily dependent on audience and traffic.
• Network marketing: you operate as an independent representative, may sell products or services directly and may also build a team under the company's published compensation terms. Costs, terms and permitted claims are set by the company.
• Franchising: you buy a licence to operate a defined business under strict brand rules. Typically much higher capital cost, formal legal agreements and territory rules.

What they have in common

In all three, you are self-employed. There is no salary, no guaranteed income, no employment protection and no holiday pay. The work is yours to do and the results vary between individuals.