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Is Direct Sales and Multi-Level Marketing for You?

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  • Is Direct Sales and Multi-Level Marketing for You?

    If you are reading this then:
    1. You are either in Direct Sales or
    2. You are interested in finding out what it is all about.

    Well, you have come to the right place. Here we will discuss the ins and outs of Direct Sales. Sit back take notes and hopefully by the time you are done reading you will know if Direct Sales is truly for you or not.

    What is Direct Sales you may ask? Direct Sales is where you are in charge of selling items personally to people. You are responsible for finding the customers, taking their orders, placing their orders and sometimes even delivering their orders. To put it a little simpler it is basically like a franchise on a smaller scale. You get a right to say you are selling a certain name product from a larger company such as Scentsy, Velata or Mary Kay just to name a few. Direct Sales are sometimes referred to as Multi-Level Marketing (MLM). This is due to the fact of building a "Team" to work for you. The more people you have and the more promotions you get ultimately the more money you will make.

    How do you get started in Direct Sales? The way most of them go is an "Independent Consultant" will either talk to you about joining and if you are interested they will have you fill out some paperwork or most of them now days you can sign up online. Wait though, don't get too excited. I would say 99.9% of them are NOT free to join. Most of them require a "Startup fee". Prices range greatly on this. Can be anywhere from maybe $50 to the thousands. I'm not saying one is better than the other because it all depends on how the company is set up. If you can make your thousand make quicker and easier than you could make your $50 make then I would say the thousand dollars would be a better route if you could afford it but they don't always work like that. It depends on if there are minimum monthly sales commission percentage and other factors.

    What happens after you sign up? After you have completed signing up then you will receive your "Startup Package" full of information and some products usually. Now they expect you to get out there and start selling. What do you do you ask? Well, if you are lucky and the person that you signed up under knows what they are doing and are a good leader then they will help you along the way. If they just signed you up to fill their "numbers" then you will have to try and figure things out along the way on your own or reach out to other members in the company that may be willing to help you.

    How do I get customers? Well, usually they tell you start with family and friends because they are the easiest to talk to and usually the most open to helping you out. Try to get them to talk to their friends about it and so forth. You start expanding your "Network" through them. For some people friends and family are either not interested or they are not in a position to help. This is where a lot of people run into a wall. Where do I go now? Who can I get to buy this stuff? For some people this is easier for them than others. If you are someone that is very outgoing and can talk to anyone and everyone then this will not be a problem for you because you can just tell everyone you talk to. For people like me on the other hand it can become a lot more difficult until you get more comfortable. For this situation be creative. Here are a few examples I do. Take a walk around the neighborhood and put flyers at the doors. This method you can get the word out to a lot of people and unless someone comes to the door before you leave you don't have to talk to people about it. The flyer has all the details. Leave some inside close to your door that way if anyone comes knock on your door then you can just give them one to take with them as well. Kind of like an exchange you will take their handout if they will take yours. Seize an opportunity. You know you run into people that will tell you everything about their lives. So always have information on you and if someone talks about something you have then be sure to give the information to them. Or maybe if you get brave and they don't ask just offer them something to take a look at. You never know who your next customer or "consultant" might be. A lot of times consultants are customers first. So keep in contact with customers and ensure every once and a while see if they are interested in joining your team.

    Do I have to keep stock on hand? This depends on the company and your sales technique. Some companies may require you to keep stock on hand while others may suggest against it. If you are planning on doing "Cash and Carry" where you sale the products and get cash instantly then yes you will need it on hand but if you are going to have customers order it and pay through the company then no you will not need to keep stock on hand. Personally I do a little of both. I keep a very Minimum stock on hand and when I sale that I replace the small stock. I prefer the customers ordering online just due to the fact it is easier to keep track of for taxes.

    How do you make money or How much money will I make? This is one of the most frequently asked set of questions you get. These are two very important questions but please remember in Direct Sales you need to know more because everybody and every company is different. It depends on what their "Title" is and how many people they have under them on their team, how many sales they had and what their commission percentage is like. Some Companies commission may be something as small as 1% while others may be something like 50%. You may think 50% Amazing!! Well, think again if you are looking to be able to build a team and then relax and earn money that way. For the most part, the higher they pay you for personal commission means the less they will pay you for commission that your team makes. Let's take one company for example " Velata ". They pay you say anywhere from 20-25% for most consultants but you ONLY make 2% off of your team below you and that is only for 3 Deep. Also you have to maintain $150 in "Personal Retail Value"(PRV) at least 1 month out of every 3 to keep your team AND you must sale $500 PRV a month to even earn commission from your team. Let's look at another company " It Works! ". They pay you usually 15% for your personal sales commission and they pay you 10% for each team member's commission up to 3 Deep and 5% for 4 and 5 Deep and 2% infinitely below that. Here you can do a monthly auto-ship at only $80 PRV to be able to earn your commissions. As long as you have your $80 PRV auto-ship each month you will also earn the commission from your team as well. So between these two examples "It Works" would be the better choice if you were planning on building a team to earn money but maybe "Velata" is the better choice if you plan to only make money off of your sales and not build a team.

    How will the company pay me? Most of them now pay either by direct deposit or they will load it on a prepaid card. Usually it is once a month. Some may still issue checks. This is really just a preference that you prefer. I wouldn't say any one way is better than the other on this.

    Will I get rich? Well, that is a difficult question to answer. Can you get rich? Yes, but it will NOT be easy. There are people that get rich off of Direct Sales or should I say at least make 6 figures a year. So the answer is yes you can but the reality is most people don't. I will tell you this though. YOU control how much you make not someone else saying okay you make $8 an hour and that is all you can make. So if you work Hard you can make a lot of money. It probably won't be quick or easy but if you work hard and don't give up it will probably pay off in the end when you have created a large team and then YOU help your team get better. The better your team is the more you will make.

    Should you join? Well, here is a check list:
    • Do you have the money for the startup cost that you can easily spend without worrying and it will not hurt you if you do not get it back?
    • Do you want to be your own boss?
    • Do you have the motivation to work on your own?
    • Last but probably the most important is Do you like the product and would you buy it at that price?

    This covers the just of Direct Sales and as with everything a lot of it depends on what company you are with but most of them operate pretty similar. I hope by reading this you have a better understanding of what Direct Sales is and if it is for you.

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