In the first part of Antonia’s direct selling guide we covered the first 6 ideas on direct selling, in this second part, we will explore 6 more ideas on direct selling and how it could work for you.
- Are customers likely to return to buy their favourite products again and again, or would purchases be a one-off? If you have a product that is a one-off or only appeals to a certain age group (baby products are an obvious example) you’ll need to keep on finding new customers. Products like make up and cleaning liquids run out relatively quickly which is why these can form the basis of a good direct sales business.
- Look at where your profits will come from. You may make more money from recruiting new reps than selling products. In a survey, reps spent less than half their time selling, nearly one hour in five on admin, and one in six on recruiting.
- Some companies allocate you a street, postcode or town. Others may allow any number of reps in each locality. It pays to find how much competition there is. Think about a different company if there are several other reps nearby. The further you travel, the higher your costs, which eats into your profits.
- Before you commit, meet your local manager. A good manager is there to answer your questions before you join, and support you to meet targets once you have signed up. They get an incentive to support you, such as a small percentage of your sales, so make sure you feel that the manager is offering you the help you need.
- Check whether the company is a member of the Direct Selling Association before you sign up. This means that each business complies with a code, which demands truthfulness and openness in recruitment advertisements, ensures you pay a reasonable amount to start up, and requires proper training, contracts, cancellation and buyback rights for reps, as well as prompt payment.
- Read your contract carefully before you make your final decision. It should lay out your cancellation rights, how much notice you have to give if you want to stop selling, and how the company buys back unsold goods, which is required under UK law. The company should have product liability insurance, but check if you are covered by public liability insurance or whether you have to arrange this yourself. You should also be clear what percentage of sales you get. Most companies offer in the region of 15 to 40 per cent. Some offer a higher percentage for bigger orders. Ask how often commission is paid.
Direct selling companies are required by law to remind potential reps, “Do not be misled by claims that high earnings are easily achieved”. Anyone who is making a good income from selling is putting many hours of effort in each month. In a survey the Direct Selling Association found that the average annual sales per seller, across hundreds of direct selling businesses, was £4094. Note that this is sales, not the amount you make for yourself. With commission ranging from 15 to 40 per cent, average reps are making from £600 a year to just over £1600.
Those tips will help you choose. Next, you need to get planning different activities to promote your products every day of the week!
If you have a business already and don’t think party plan is for you, think again. You could look for complementary items to sell to existing clients. A make up artist would do well with a great range of cosmetics that she could sell to clients who want to recreate a look at home, for example. OR, if you have your own business selling products, you could even use Party Plan to expand the business and build up your own team of commission-based sales people.