The Truth about Direct Selling Articles | Sales

By: Darren Williger

The only thing which remains constant is change. There is a lot of truth in it. Look at any area round you and you would find people doing things differently than the way they used to do some years ago. Direct sales are no different. Today selling from the comfort of your home is the way to go.

According to Direct Selling Association or DSA, the direct sales industry was valued at $28 billion in 2002 with an estimated 13 million people who are working independently in this market. In 1997, the same figures were $22 billion with 9.3 million people.

This growth according to DSA President Neil H. Offen, can be attributed to more number of people getting involved in a more sophisticated market. This market, according to him is attracting more college students as consultants and the industry is going global. In fact, it is getting to be more attractive even to Wall Street investors as well as Venture Capital groups.

Once dominated by women the direct sales consultants are now attractive men too and men participation has grown from 10% in 1990 to 25% as of now. This is because this market is now attracting a varied range of products like vitamins, food supplements, long-distance telephony etc., typical products which are not very feminine by nature like say, cosmetics or home ware etc.

Despite this kind of growth many still harbor the feeling that direct sales are nothing but various types of pyramid schemes which simply require a participant to dole out cash before he or she recruits his or her own team. While there is not product to be sold, people make money solely from new recruits.

Direct sales, on the other hand involves selling valid products or services where the profit is made by the seller and his recruits. In a larger direct sales company the consultants have a group of salesmen working under them who pays the consultants commission, also referred to as a down line. The affiliate marketing in the internet is an example of such payments.  

Responsible and conscientious business enterprises focus more on what they can possibly do to encourage customer delight and ensure complete customer satisfaction. The earn customer trust by offering warranties so that they can stay away for any ignominy associated with direct selling. Offen, the DSA President believes that the authenticity of intention of a company would depend on what kind of protection and warranties a company offers. To know more about a company, you could seek referrals from consultants and previous customers regarding their experiences. Finally, you must truly adore the product you propose to sell, as this is the key to your success in the business of selling.

How do you decide on the legitimacy of a company or whether the company and its products are suitable for you? Follow the list of questions below and you would know:

• What is the source of your expected income from the company? Is it from selling or recruiting? Though income from recruiting is part of any direct selling venture, your primary source of income ought to be from selling the product. If a company assures income only from recruiting, you ought to be cautious.
• What is the kind of initial financial commitment which the company is asking for? Many direct sales companies need a commitment of up to $500 as part of starting costs. If you see that most people are making money from selling start up kits, watch out, this company is not for you.
• What do you think of the product? Would you buy it yourself, if you were not working for the company? In case the product does not compel you to try it, in all likelihood, you would not be able to sell it also.
• Is the company promising you nearly-impossible fortunes, like making a million dollars in 6 months? You have to be very careful of such companies who over promise and most definitely under-deliver. Talk to customers, consultants and study the company’s reputation, brochures etc., before you decide to join them.
• Check out whether the company is affiliated to DSA. This is an association which has an application process which takes nearly a year for new direct sales companies. There are a lot of rules and regulations also, which the existing members have to abide by. Membership to DSA should assure you of good trade practices. Go through the DSA website dsa.org for more details on the subject. 

Incidentally, it took nearly 20 years for Lisa Clark of Greenwood Village, Colorado, to bring Mary Kay Cosmetics to the current position. This company is one of the top direct sales companies in the world. The company was started by Lisa, 26, as a small business venture in 1984. She wanted to sell cosmetics during holidays. Soon her sales skyrocketed and she started to earn much more than what she was earning in her regular job. She went into the business full time and soon achieved an annual turnover of more than $2 million by the time it was 2004.

The direct sales industry is strewn with rumors and ignominy. But in reality it is doing well and showing healthy growth. All you have to do is to locate the right company, selling products which you like using ethical business practices. If you find one such company, you could also become the next millionaire.