Know Your Options – Business

Know Your Options – Business

As long as you know your options you’ll do well in sales.

I have fielded a lot of questions throughout my career. One of the questions asked often, was about what type of business the person should be in or what type of sales he or she can do to make a living.

My answer: It depends on your personality and ideals.

I’m going to briefly go over some differences in running a sales oriented business. It is my hope that this information will help you make a better choice of what type of sales you’d like to do. Don’t forget to visualize yourself in each scenario.

Non-definitive definitions

1. Direct Seller (i.e.: Direct Sales or Direct Marketing)
   Selling through targeted contact with an existing or prospective customer, direct marketing enables direct marketing consultants to create programs, which will obtain a measurable response from their marketing efforts. Direct marketing solutions are dependent upon the utilization of databases, mail, and email lists.

Direct marketing services are personalized towards the potential customer utilizing the information the direct marketing consultants obtain. Direct marketing services also utilize responses from potential customers in the form of a purchase, an inquiry, or a referral.

(Reference: onpoint-marketing http://www.onpointmarketing.com/)

Side Note: Being in Direct Sales does not exclude you from being in MLM or network marketing. My thoughts upside: I was in direct sales for many years and loved selling the products. It had a place in my life when I needed the products. I earned all the different products I needed for free. I was a rep for one direct sales company for 3 years, then another for about a year, then a mlm company for a couple of years. Socializing with other moms once a week was another great positive. That filled another one of my needs. Each endeavor has a time a place in our life.This is a great job for the outgoing, social, friendly personality type. Direct Sales companies do the marketing with you and for you to a point. They have marketing materials and media coverage. There is a lot of hype/support that many people need to keep them going and these types of organizations fill that need. There is also a sense of belonging to a larger organization.

The Busy Consultant Direct Sales Basics for Today’s Busy Woman

If you sign up with a direct sales company and you don’t spend most of your focus on a down- line, you can better service your customers. I like this aspect. It allowed me to build up a client base that followed me from business to business.

My thoughts downside: My accountant figured out that I was only making about $1.50 an hour. To move up and do better I had to spend money on conventions and sales meetings. That was valuable time taken from my family.

Another issue sometimes experienced is when there are too many reps for the product line you choose in one area, making your local market saturated. This can hinder sales or cause dissension.

Also, you often have to keep inventory, which is another topic in and of itself. Managing inventory can be a real chore. I remember when I got stuck with products that just didn’t sell any longer. When I sold makeup I had stock that spoiled.

Side Note: There are now many direct sales companies who do not require you to keep inventory. You just call in your order and they drop ship.

2. Multilevel Marketing
   Multilevel marketing (MLM) plans are designed to sell goods and services through distributors. Other names for MLM are network marketing, matrix marketing. The MLM concept is based on a promise from a company that if a person signs up to sell their products, they will pay a commission on all sales generated by that person as well as other distributors the person recruits. MLM plans typically guarantee commissions through two or more levels of recruits that make up a down- line.

(Reference: onpoint-marketing http://www.onpointmarketing.com/)
Great resource!

My thoughts upside: I know others who absolutely thrive on working their MLM business and love it! The ones who’ve been able to generate the residual incomes the companies boast about are mostly the ones who stick with the company for a long time. They are also people who are so passionate about the company, that it is their joy to be all about the company.

This is also a great job for the outgoing, social, friendly personality type.

Multilevel Marketing companies do the marketing with you and for you (to a point). They have marketing materials and media coverage. There is a lot of hype/support that many people need to keep them going and these types of organizations fill that need. There is also a sense of belonging to a larger organization.

My thoughts downside: Some ladies would rather focus on a down-line, instead of selling the products, feeling that it makes them more money in the long run.

There are sometimes too many reps for the product line you choose in one area, making your local market saturated. This can hinder sales or cause dissension.

Also, many have shared with me that they lost a lot of friends while running these types of business because they were taught to eat, sleep, and breathe their business. Some people tend to keep themselves grouped with those interested in the business and this leaves out the friends they once had. I’ve experienced this first hand. My friend didn’t have time for me unless I was into her business. And when I didn’t sign up she just couldn’t understand why. She immediately moved onto other people.

The last type of sales is about owning your own company reselling other people’s products, or your own products.

3. Wholesale/Retail
   You purchase products from vendors at wholesale and sell retail. Or, you make your own products to sell wholesale and/or retail. This could be at trade shows, online, at home parties, etc. You are the business owner. You decide when, where, and how you’ll sell, what price to sell for and more. Although some wholesale vendors have restrictions, they are usually easy to deal with.

You still market by using a database management program, website, online marketing, snail mail, email, and phone sales. But now the marketing is up to you instead of having a company give you marketing tools. Sometimes larger companies do outside marketing and retain ads in large publications that can help you.

My thoughts upside: You can choose what products to sell and when. If you’re not selling products that you make by hand or that are your own design, you can become a manufacturers rep. You buy wholesale and sell retail.

Sometimes a vendor will allow you to set up an account giving you a certain area of your state to sell to, or a certain market share to supply to.

Running your own business is best suited to a strong personality type. This type of work takes someone who’s very self-motivated, goal oriented, and not easily discouraged.

For support, you can join local business organizations for networking.

My thoughts downside: The downside to this is the need to make up your own marketing brochures, ad campaigns, etc. You also don’t have the hype/support of others doing the same thing to cheer you on.

You might also have to pay for the products before you retain the sales. Many fall into a trap of borrowing money for purchases, and falling behind in this loop. They end up owing money and not selling the products fast enough to pay off the debt. It’s a vicious cycle. So watch for this if you choose this type of sales. Ordering on a pay up front basis, when you have the available funds to invest, will save you from going into debt. Taking orders in advance can help with this.

There are many reasons to choose any one of these formats of business. I found each one to have a place and time in my life. Now that you have a little more information, if you had your choice, which one would YOU prefer?

©2006, 2015 Susie Glennan
All Rights Reserved.