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Making the Sale: Is Direct Sales the Field for You?

Image by reynermedia, Flickr

Image by reynermedia, Flickr

Earning a college degree doesn’t always result in a dream job right after graduation. Many college graduates — and current students — need to find a quick and easy way to earn money while waiting for their big break.

Some people turn to freelancing. Others turn to direct sales. Let’s take a look at the job prospects, responsibilities and earning potential of a direct sales representative.

What are Direct Sales?

Direct sales involve delivering products directly to customers without relying on a fixed retail location. Direct sales companies are also occasionally referred to as multi-level marketing companies. These involve the recruitment of new consultants.

Individuals who work in this field are referred to as independent representatives, independent distributors, sales representatives or consultants. Sales representatives buy products at a wholesale discount. They then turn around and sell those products to friends, family members, and others in the community for a higher retail price, thus, earning income on each sale.

Who Can Be a Direct Sales Representative?

One of the perks of working as a direct sales representative is the lack of job skill requirements: anyone can work in direct sales. In fact, in 2011, more than 15.6 million Americans were involved in the direct sales industry.

Previously, the market was overrun with middle-aged women — work-from-home moms who wanted to earn some extra money. But recently, the sales force demographic has shifted.

The majority of consultants are still women, but more men are joining the industry. In 2011, 22% of consultants were men (up from 14% in 2008). Additionally, the average age of consultants has dropped. More young people are realizing the earning potential of direct sales, especially with greater access to customer acquisition through social media. The added strain of a difficult workforce has made direct sales appealing to a lot of college graduates.

Naturally, there are certain things that will make you more successful as a direct sales representative. For example:

  • An outgoing personality (you’ll constantly be meeting new people)
  • The ability to sell (anyone who falls into the “selling ice to an Eskimo” category will do well)
  • Business management and marketing skills (you’ll basically be running and promoting your own business)
  • Self-control (it will be awfully difficult to resist those excellent discounts on your favorite products)

What are the Best Cities for Direct Sales?

Direct sales can be made anywhere — including internationally. This field allows you to do business on a global level. What you choose to sell might depend on the area you live in. For example, if another sales representative has cornered the market on Herbalife, you might not want to try competing.

The demographics of your area will matter too. Trying to sell young, hip, and trendy products from Thirty-One Gifts might not be too successful in an area that is heavily populated with retired couples.

Do some research in your preferred area before deciding what you’d like to sell.

What are the Most Popular Companies to Work For?

The Direct Selling Association represents 200 different companies (with more than 50 companies hoping to join).

Some of the most notable direct sales companies include:

  • Amway (food, vitamins, and cookware)
  • Avon (cosmetics, skin care and beauty supplies)
  • Discovery Toys (educational toys)
  • Tupperware (food storage and preservation products)
  • Herbalife (weight loss products and energy drinks)
  • The Longaberger Company (hand-woven baskets)
  • Mary Kay (cosmetics, skin care and beauty supplies)
  • Nu Skin Enterprises (cosmetics, skin care and beauty supplies)
  • The Pampered Chef (cooking and baking supplies)
  • Scentsy (wickless candles)
  • Norwex (chemical-free cleaning supplies)
  • Usborne Books (children’s books)
  • Silpada (jewelry)
  • Thirty-One Gifts

Studies show the most popular direct sales niches are:

  • cosmetics, skin care and beauty supplies
  • food, nutrition and vitamins

Most of these companies require the consultants purchase their own inventory and have items available for sale. However, other opportunities require less overhead.

For example, vitamin sales have grown significantly over the last few decades as our society has become more health-conscious. Many of these sales happen online — similar to affiliate marketing. Direct sales representatives help customers they find online (via their website) or through traditional home parties like other direct sales companies.

We talked with Dr. Agin at vitamininjections.net, who gave us insight into their sales process. A vitamin sales consultant works closely with one or more vitamin distribution companies (usually vitamin injections, pills, or other nutritional products). You, as the sales consultant, sell the vitamins; the company fulfils the order and then ships it to your customers.

Can I Make Money?

Here is what it all comes down to: can you earn a living as a direct sales representative?

Before you begin making money, you’ll probably have to spend money. Most companies ask their consultants to buy some of their products. It’s hard to sell something you’ve never used personally. Plus, having an inventory on hand means you always have certain products available for purchase.

You might also need to pay registration fees, buy a welcome kit, attend training, or purchase marketing materials.

Of course, these added expenses aren’t involved in ventures that don’t require a significant inventory (like the above mentioned vitamin sales or large exercise equipment).

The amount you earn will be directly proportional to the amount of effort you put into your company. If you want to earn a full-time salary, you’re going to need to work full-time.

The good news is, there is definite earning potential. In 2011, the direct sales industry brought in more than $30 billion in the US. Individual companies earned big; for example, Herbalife sold $4 billion in products.

Stats show the average income varies between $637 and $336,901 per year. In 2011, the median annual income was $2,400.

Those numbers may seem low, but there are several things to consider. First, the vast majority of consultants (nearly 90%) worked less than 10 hours per week. Additionally, many people become consultants just so they can receive their favorite products at a discount — earning money might not even be a goal.

Here’s a bonus: many companies offer perks to their best sellers. These can range from all-expense paid vacations to pink Cadillacs.

Keep in mind there are lots of non-monetary benefits:

  • You can work from home
  • You set your own hours
  • You can take time off when you want it
  • You don’t report to a boss
  • The majority of your sales will take place in social settings, like food-filled parties hosted by your friends

Should I Do It?!

Obviously, there is no one-size-fits-all job opportunity. However, many people have found success with direct sales — whether as a full-time job or an extra money maker. What you’ll need to determine is whether you have the personality and motivation for direct sales. And hey, it doesn’t hurt to try!

Would you become a direct sales consultant? Would you do it for the money or product discounts? Which companies sound most appealing to you? Let us know on Twitter @StudentsDotOrg!