The following is a summary of an article that appeared in the March 2016 issue of Direct Selling News:

What is the promise of the opportunity offered by any direct selling company? Direct Selling News (DSN) Ambassador John Fleming: “Direct selling companies offer an opportunity to people from all walks of life, regardless of background, education or skill level, the chance to own and operate their own business backed by material support from a larger brand and supported by a pathway of training.”

What do direct selling companies offer to individuals?

No. 1. Customers Are at the Heart of Direct Selling

While it may have been true in the past that a direct selling company would focus only on its independent contractors, the evolution of technology becomes a great enabler. The good news: Technology makes it much easier for a company to identify customers than in decades past. Before, the independent contractor was the one responsible for distributing goods across the customer spectrum, and independent contractors did not report those sales or provide detailed customer information back to the company. Now customers can go directly to the company through a website that is company branded but owned by a direct seller, and they can even shop on a smartphone.

Direct shipment to a customer is possible with most direct selling companies, and e-marketing tools provide a link between the company and the customer that did not exist in previous years. Customer purchases can be automatically attributed to their direct seller, while at the same time the company can collect specific customer information. The direct selling business model has improved dramatically over the past 10 years, and both independent contractors and consumers are experiencing the benefits.

No. 2. Personal Growth Is Hard-Wired into the Opportunity

The fundamental concepts of bettering oneself and one’s place in life are woven into the fabric of direct selling. Personal growth is something individuals keep with them the whole of their lives, whether or not they stick with the direct selling opportunity that provided the materials for that growth.

Often called “soft skills,” goal setting, time management, handling rejection and selling techniques are only a part of the education provided by most companies within this channel. Becoming an empowered individual, believing that you can be more and do more than your current circumstances would allow, taking charge of your life and helping others to do the same—these are the transformative pursuits that create a ripple effect throughout one’s life that can never be undone.

No. 3. Recruiting Is Essential to Successful Direct Selling

Regardless of the words used—recruiting, sponsoring or building a team—this activity is a vital part of the direct selling business model. Direct sellers have two key paths for developing their independent businesses: sell products or services to customers, and, if they wish to build a sales organization, recruit others who will also sell products and services to others as well as share the earning opportunity with others. Direct selling compensation plans reward a distributor for both opportunities.

There is no discrimination relative to gender, age, past experience or inexperience, nor current economic or professional status. Most importantly, direct sellers have fun doing what they do, and that is why direct sellers share with others (recruitment) what someone shared with them. We know that when a company only pays for the recruitment of others this becomes the identification of a pyramid scheme.

No. 4. Direct Sellers Do Not Have to Make Large Investments in Inventory

You can start a direct selling business with minimal investment in inventory, and there are virtually no minimal requirements. Direct-to-customer shipping practices and online ordering technology have all but eliminated the need for an individual distributor to hold onto large quantities of product. Some direct sellers may choose to carry inventory at some level to facilitate “cash and carry” sales, because some customers prefer to take their product home at the point of purchase rather than wait for it to be shipped.

No. 5. Direct Sellers Earn in Proportion to Time and Effort Invested

The opportunity within the direct selling industry is not one that advocates that all who enter will become successful, but that all who enter will be rewarded in proportion to their successful efforts in selling and servicing customers and recruiting others who do the same. When compared to many other new business offerings, such as purchasing a franchise, being solely responsible for designing a business on one’s own or taking advantage of the new U-economy, the direct selling opportunity affords any individual a low-cost option for entry into entrepreneurship and a pathway to success with a specific startup process and ongoing training and development.

DSN’s research with Harris Poll on the topic of earnings through direct selling opportunities revealed that 70 percent of people surveyed who identified themselves as current direct sellers devoted 15 hours or less to their business and the median income level was $6,200. In other words, the research indicated that part-time hours produced part-time revenue for most people engaged.

The research also indicated that in the 12 months prior to the survey:

>  27 percent of respondents earned less than $1,000

>  51 percent earned $1,000 to $49,000

>  15 percent earned more than $50,000.

This data supports what we believe about direct selling opportunities: Some smaller percentage will earn a sustainable and large income, and the greater percentage will earn part-time income.

The economy of the United States has its own inherent risks. Information found in the Social Security Administration’s report on Wage Statistics (Most recent numbers are for 2014) show that Americans are very diverse in terms of what they actually earn through traditional jobs and career opportunities. If you earn:

• $20,000 per year, you make more than one-third of all Americans
• $30,000 you make more than one-half of all Americans
• $40,000 you make more than 60% of all Americans
• $50,000/year you make more than 70% of all Americans
• One in five Americans makes between $50,000 and $100,000 each year
• 8% of Americans bring home more than $100,000 per year
• Only 2% get paid more than $200,000 annually

Summary of the DSN Point of View

The direct selling business model currently engages close to 100 million people globally who generate close to $180 billion in sales, most of whom are women. With an opportunity to start a business with modest investment, learn basic business building principles and skills, and earn in proportion to effort invested, additional benefits include enhanced skills related to business building, personal development opportunities, ways to create a blueprint for greater achievement in life, ways to better balance life and work, understanding the value of entrepreneurship, recognition of achievement and bonuses for overachieving, along with the camaraderie of being around others who are learning this themselves.

Not all will succeed. Those who do not succeed in business terms (receive a profit) may still succeed in knowledge gained, experiences that were valuable and a new belief in one’s ability to achieve more of their human potential.

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My point in sharing this information is to encourage those considering direct sales as their business model to research the numbers – the number of people driving the company cars, the number of people making 6 figure incomes, and the numbers of the rest of the people.  I agree some of the soft skills of business ownership are there to be learned.  Are you considering direct sales?  Let’s talk and develop your business plan in direct sales.