Direct Sales: How and Why It Could Be Your Best Money Maker

Money MakerI Believe In Opportunity 

Recently, I have witnessed a lot of distrust and dislike for certain side hustles or side gigs, namely with respect to direct sales and MLM companies. I share a different perspective, and I am going to tell you why. I believe direct sales and MLM companies can present one of the best side hustle or side gig for anyone who is interested in building their own business. But, before I do, I want to share a few things that you need to know. 

Background Info You May Not Know

MLM stands for Multi-Level Marketing. Direct Sales and MLM companies have been around for over a hundred years, and started with door to door sales of knives, encyclopedias, and perfumes. This is how Avon started. It was a sales person who performed poorly at selling books, but every house he went to, he received praise for his fragrances and cosmetics that he made at home as a hobby. One of the original side gigs, if you will. He expanded on this side gig as he saw more promise in selling women’s products than the books that he peddled. Today, that company is still in existence, and is still a profitable way to earn money.  

Tupperware, Amway, Thirty-One Gifts, Scentsy, Norwex – these are just a few of the opportunities in direct sales or multi-level marketing.

The Details of the Business (Nitty-Gritties)

Opening shop with a direct sales company is much like opening a micro business of your own. Each company has a “buy-in”: usually it’s a kit of common items that a representative would sell in the normal day-to-day business. Sometimes the company requires a big buy-in, where you get a large kit of goods, and other times you can sign up for free, or a very small cost. Either way, the company doesn’t focus on this buy-in to make money. The range is usually between $10 – $300.00 to sign up. 

 

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I like to compare this concept to franchises. If you wish to operate a franchise, you have to purchase the rights to have that storefront. You pay money for the opportunity to hang out a well-known name, and to represent their goods. Think Subway, McDonalds, Starbucks, etc. All of these places charge for start up, and there is a head company who controls all of the franchises. (Which is why the BigMac is supposed to be the same around the world.)

No Big Bills

The direct sales companies handle promotional advertising and marketing.

This is ideal for a few reasons:

  1. The independent sales rep pays for this from a portion of sales made, and doesn’t have to put out thousands in advertising.
  1. The company can control the quality and quantity of the advertising.
  1. The company has a marketing team of experts who know what works and what doesn’t.
  1. The independent sales rep is not required to test the market, pay for advertising, pay for experts, etc.

Direct Sales Responsibilities 

The biggest responsibility that falls to the rep is to keep herself (or himself) organized; and build a customer base. Keeping customers happy on a service level is within the control of the rep, and the company takes responsibility for the rest. 

How to Make Money in Direct Sales

In most situations, the representative has options on how to make money:

Sales

A representative makes a base commission (or a set value) on the sales. This is no different than a car salesman! As the representative builds her sales levels, she makes a higher commission.

Commissions can be based on the size of the order, the amount of sales over a period of time, or on the items ordered. Each company sets out their own earning structure.

The representative is responsible to obtain sales materials, like catalogues, and any other branded items that she wants to use. While this comes from the representative’s proceeds, it is still a business expense that can be written off at the end of the year. 

Branded items, like pens or car wraps, are not necessary, but are a great way to get the conversation started. I have experienced sales firsthand just by having a magnet on my car stating what company I was representing.

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Teams (like Affiliate Training!)

Some companies offer additional commissions or rewards if you provide support to other representatives.

Much like affiliate marketing and training, you find a product that you support, and the company will pay you to promote the product. If others purchase that product based on your recommendation (or link), you are paid for your services. The company wins with your promotion of their product and you win by being paid.

Building a team with direct sales is the same concept. It’s natural to talk about your business, and to find like-minded individuals who want to sell the same products. By supporting these individuals throughout their growth as a representative, they are more likely to succeed, which makes the company money. In turn, the representative is rewarded by receiving a commission of the team member’s sales. 

The Pyramid Scheme Plan

It’s the model of the “pyramid” that makes people believe there is a hidden and  nefarious intention, but in reality, it’s a smart marketing move. As a head of any company, if I can motivate representatives to take on a team, support them and encourage success, why wouldn’t I pay an extra 2-10% of the sales? That’s worth it! 

Be Passionate

Choosing the right direct sales company is always key. My personal rule of thumb is to choose a company when you are passionate about their products.

Ideally, choose a company that you already use products from. I chose certain companies because I knew I would be buying the products anyways, and saving some money with a seller’s discount just makes good “cents”.  

The success of direct sales is often tied into selling items that people already buy. In the general population, who doesn’t buy soap, gift wrap, clothes, food containers, candles, books… we all buy these items at one time or another.

 

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Misnomers, Myths and Lies

Some misnomers about direct sales companies: 

– The companies encourage representatives to spam products on those around them.  WRONG.

This is very false. Most companies frown on spamming. When you see a representative “spamming” groups online, feeds, fliers, etc., you are seeing someone who is very excited about their products and their business. It’s more of an etiquette issue than anything else, but it’s no different than that vegan over there that tells you she’s a vegan every day. Oh, did you know she’s a vegan? (No disrespect to vegans!)

– You have to sign up your mom, grandma, sister and neighbour, otherwise you will not make any money. WRONG.

Good companies do not force representatives to sign up others. It’s a big responsibility to run a team, and to encourage them to continue. Having your family as representatives for the same company does not fair well: it means everyone is buying at a discount, and everyone is getting the same thing for Christmas, (ha) but really, companies do not force you to do that. Again, it’s the individual representative’s enthusiasm that is usually behind the push. 

– Very little pay for a lot of work. WRONG.

Like any business, side hustle or investment, it’s like pushing a rock up a hill. It’s a lot of work in the beginning, but eventually you will get up the hill. Keep at it. Then, when the rock crests over the hill, you know you’ve made it. It’s still going to be a lot of work to keep up with the rock, but you are finally seeing progress. 

You see, direct sales companies are modeled after bigger companies, and have many of the same traits. There’s payment for a job well done, and freedom to run your business how you see fit. Many people find their direct sales business fits into their life, as opposed to having their life fit around a business. 

Isn’t that the goal? 

When we naturally purchase these items as part of our daily life, it’s not unreasonable to seek out the best value. Prices are competitive everywhere, and depending on the product, they can be as readily available as if you had gone shopping at the store. The difference is customer service. You will never find a Wal-Mart employee who does house calls, or gives you fragrance samples with your purchase. Target doesn’t offer raffles, thank you gifts or camaraderie with the sales person, and you cannot rely that the same sales person will be there next week.  With direct sales, you have one person you are dealing with, and that’s what makes it special.

If you feel inundated with ads on social media, requests to host parties, or the office “pass the book around”, do not feel guilty by saying, “No, thank you.”

However, by buying from direct sales representatives, you might be:
– fundraising for a good cause
– helping a struggling mom fit her side business into her off-hours because she can’t get a second job with her schedule
– assisting a student pay for school
– enjoying a quality product!

Any side gig or hustle requires dedication and hard work, and some of these people work the hardest. I know some that have made a fulltime income from their home business. It’s very possible.

My intention today is to show you that direct sales are not what they used to be. They are simple, flexible, home-based businesses worked by people like us. They are not scams, and no more a risk of being a fly-by-night company than any other opportunity out there.

Watch the video below. Two people from Hamilton, Ontario launched a company selling tea mixes, and they pitched the Dragon’s Den. The investors jumped at the opportunity, and the expansion grew beyond anyone’s expectation. This is an example of a direct sales company. This could be yours.

I look forward to hearing what you think of direct sales companies, and if any of this was new to you, or changed your mind.  You can also follow me on Twitter, Instagram, or join the community page on Facebook.

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Series: Habits of the Wealthy and how I implement them into my Life (3)

 
Change isn’t easy, and learning new habits isn’t something that is done overnight. Much like any other habit, it requires passion, persistence and determination. One of the habits of the wealthy is about goals.
Goals are dreams or wishes that we want, but they are realized and written down. Goals are defined as the object of a person’s ambition or effort; an aim or desired result, according to dictionary.com. Wealthy people tend to write down their goals, and focus on the process, even if it is extreme or seemingly unattainable. In fact, Grant Cardone, author of The 10x Rule, says that goals need to be big, ten times the size as one that you think you could attain.
 

Nitty gritties:

Write out your goals

80% of wealthy people focus on achieving a single goal, compared to only 12% of poor people. (Thomas Corley)

Have more than one – you are allowed

This is not to say you should only have one goal. You can have many – in fact, write down as many as you can think of, because the purpose of doing this is to reach your goal, so you will need another and another to aim for as time goes on. What this does mean is that wealthy people keep their goal in their mind at all times, and use situations throughout the day as inspiration on how to attain that goal.  Keeping your mind open to possibilities might mean goal #2 is actually part of #4, and a subsection of #1… see? That list might be handy after all.

Be specific

Part of writing down your goals is ensuring you are using specifics. “I want to be wealthy” is not the same as “I want to invest $100,000 over the next two years, and I want to fund this project by opening a side hustle where I offer pies and pastries to churches.” Just an example, but you get the idea.
The wealthy are deliberate, dedicated goal-setters. Corley states that 62% of rich folks focus on their goals every day, as opposed to 6% of poor people – and 67% of the wealthy put those goals in writing.
(Side note: you have a to-do list, right? Go write down a reminder to write your goals out. Now.)
5 Daily Habits of Highly Successful People report that 70% of the wealthy pursue at least one major goal (see? You can have more than one). Only 3% of the non-wealthy do this.   

How I implement this into my life:

I shared a number of them with you earlier in the year.
I have decided what my focus will be for 2018: Money working for me. 
This means I need to attack consumer debt. Credit cards, loans and car loans are all getting the scrutiny this year.
Another area of focus will be for the future me: investing into my future.

Hey XB, what’s your plan?

I have a book I am publishing through Amazon: Build Your Business, Grow Your Team, and Make More Money in 30 Days and there will be a few more after that one.
Another goal is I want to read more, both for pleasure and for self-improvement.
I have actionable goals for my blog and I want to grow this community. I am hoping to provide quality content that will help readers and bloggers alike.
Understand that this habit is more about you making the decision to live intentionally, and less about how to fit it into your life. Once you have chosen a goal or two to focus on, we can break it down into steps to help you achieve it.
Share your goals with me, and let’s talk about them!  Don’t stop at just writing them down; let’s make it the year it happens for you.

Series: Habits of the Wealthy and how I implement them into my Life (2)

habits of wealthyHabits. These are what turns us from ordinary into extraordinary. Through an ongoing focus and a goal for this year, I am striving to build not only financial wealth, but a more professional, positive and productive mindset. One way to change what we receive from the universe is to do something different. This habit is about how we spend our downtime.

I don’t want to title this “Don’t watch TV” because I do not feel it’s that simple. Let’s think of it as maximizing our time. 

Maximizing Our Time

www.Businessinsider.com wrote an article entitled 9 things rich people do and don’t do every day. Here are some stats they share on the use of time:

They don’t watch TV.
“I watch TV one hour or less per day.”
Rich people who agree: 67%
Poor people who agree: 23%
They read … but not for fun.
“I love reading.”
Rich people who agree: 86%
Poor people who agree: 26%
Plus, they’re big into audio books.
“I listen to audio books during the commute to work.”
Rich people who agree: 63%
Poor people who agree: 5%

Variable statistics range in that the average person reads between 1 and 5 books a year. Wealthy people read an average of 30 minutes a day or more on self-improvement, and choose to listen to books during commutes and other times.

From Dave Ramsey’s website: President Harry Truman once said, “Not all readers are leaders, but all leaders are readers.” In The Millionaire Next Door, Stanley says that the average millionaire reads one nonfiction book per month.

The Ways To Implement Change Into Your Life

I love to read. (Nerd moment: all reading is played out in my head like a movie. Just like a movie, I cannot stop it part way. This is part of why reading is hard for me to do in pieces – I want to read it all at once!)

While I was growing up, we had one television in the house. It was a 13” analog television, no remote, two dials and thirteen stations. One station was just fuzz, two were French, and the rest were of a basic variety. There were four of us in the house. While the demand on the television was not as bad as some houses, sitting on the floor and watching tv from a few feet away was not as comfortable as being in my room, on my bed, with a book or three, and not having to watch She-Ra because my sister’s turn to pick had come up. In fact, this tv was probably the reason we both were raised as readers. Neither of us prefer television as a means to pass time.

Today, I do not pay for cable television. We do not have a sports package, or the HBO channels. I watch what I want on Netflix, and avoid the commercials of the newest and greatest inventions that I must buy. Netflix binges do occur, but we try to limit them by turning it off after a few episodes. I read, listen to books, play puzzle games and have conversations. Follow it up with reflecting on and schedule my week. I load up my audio books for the drive to and from work, and I read other people’s blogs about the topics that interest me.

While it’s not an easy task to schedule in time to read, it’s easy to do when the television is turned off. How many hours can fly by when you are watching “something”, then just one more episode, and just one more minute. Same thing can be said about the internet: There are so many cute kitten pictures and funny videos of people falling down that you could entertain yourself all day. Instead, turn off the television and turn off the social media. Pay attention to where and how you are sitting, and get comfortable. Pick up a book (or e-reader), newspaper, or any other resource, and read. Stretch your mind, learn some new words, and best of all, think.  

There is a link above called Resources. You will find a list of books that I have read during my journey of learning about investments, and a few others that have motivated me. I recommend checking them out. Even a 30 minute break from the screen can help you sleep better, and feel better. Plus, you will have more to talk about at the water cooler tomorrow. 

Another option is audiobooks. I no longer listen to the radio in my car, as I was tired of hearing the commercials and the same songs on repeat. I wanted something that would make me think and improve my life. There are apps available to download free podcasts, audiobooks and news summaries. I use Podcasts for Apple, and subscribe to a variety of podcasts that interest me. The podcasts automatically download while I am on wi-fi, and automatically delete after I’ve listened to them. 

If you enjoy listening to the radio or having the television on while getting ready in the morning, you aren’t alone. Streaming a podcast or an audiobook is a great substitute and is a wonderful way to get in some extra reading. Wake up with your coffee and a great book while you get ready in the morning or walk the dog.  

So the next time you find yourself sitting in front of the television after dinner, mindlessly watching another sitcom about some dire situation made into reality tv, turn it off. Reach for a book and enjoy some learning instead. After all, these are the habits of the wealthy! 

Habits
Indigo/Chapters: So Many Books To Read