Can You Make Money With a Direct Sales Company?
By Chad William Hershey
Whenever I read work-at-home blogs or message boards, I always see some variation of the question "can I make money in direct sales"? Most of the answers to this question come from those who have recruited a few people so the answers are always very biased.
So back to the question, can you make money in direct sales? The quick answer is yes, you can. However I'd like to offer more details than just a "yes".
Direct sales companies usually offer the distributor two ways to earn money. One is through the actual sale of a product and the other is through sponsoring or recruiting people to become representatives for the company.
This article will speak of industry-wide averages only. The average commission on the sale of a product in direct sales is roughly 30% to 35%. If in a week, you sell $100 worth of products, you'll earn about $30 to $35 dollars. This will not pay your rent, but it's $30 you didn't have prior to selling the product!
When someone comes to me and says they want to earn $1000 per month, I cringe a little bit. Not because it's not possible to earn $1000 per month, but because the vast majority of those involved in direct sales never earn this much. Speaking of sales only, in order to earn $1000 per month, you'll need to sell about $3000 worth of products every single month. If the average customer spends $35 on products, you're going to need at least 85 customers, each ordering $35 worth of product, to hit that $3000 sales mark. Again, this is not impossible, but almost no one can do this their first few months in business. It's not easy finding 85 customers each and every month. For those who stick with it, for those who continue to pursue new customers each and every month, it is not uncommon to have several hundred customers in a couple of short years. Direct sales becomes especially profitable when you're selling a product that has to be re-ordered each and every month.
Now let's switch gears and talk about sponsoring others. The AVERAGE industry-wide income earned from sponsoring others is about 10%. This means for every $100 sold by those you sponsor, you'll earn about $10. Again, using $1000 as our target income, you'll need to create a group volume of at least $10,000. Ten percent of ten thousand is indeed the $1000 you were looking for. Again, this is not impossible to do, but it does not happen as often as the internet leads us to believe it does. Let's say you sponsor one person per month your first year. This means you'll have 12 people in your group at the end of that year. If each of those 12 people sold $500 per month in products, you'd have group sales of $6000. Not quite $10,000, but you're definitely on your way.
The best advice I can give someone is that when they choose a direct sales company, they have to dedicate themselves to at least a 3 year plan. If you get involved with a direct sales company expecting to get rich overnight you may be very disappointed. Big money can be made for the average person but it takes time & dedication.
About the Author
Chad William Hershey of http://www.ChadHersheysBlog.com is founder of his own home based business, The Pinnacle Group. He is a student and mentor of the Universal Law of Attraction, as seen in The Secret, and believes fully in The Master Key System. Chad shares his passion and knowledge of being in the home based business arena for the last 15 years and enjoys helping others succeed with Internet marketing. Chad's business website is http://www.ManifestYourFortune.com
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