Pros and Cons of Direct Sales, Part II: Pros

In my last blog post, I provided you with an overview of the money-making method known as direct sales. Direct sales, also called MLM, refers to a sales method in which someone recruits you into their business and you, in turn, own and operate your own independent business.

Seven Good Reasons to Own an MLM Business

You earn revenues from retail sales of approved products as well as from the sales of anyone else who you recruit into the company. When such business relationships are charted onto paper, it looks like a pyramid – hence the pejorative term “pyramid scheme”  which his also used to describe an MLM business.

Although MLM has a bad reputation in some quarters, let me stress that it is a viable method of earning income. I am not selling you on any particular MLM offer and I am not affiliated with any direct sales companies. However, as a marketing consultant, I have worked with some direct sales businesses and obtained a unique window into the inner workings of a very profitable direct sales company. As I result, I feel that I have a special perspective to share on the benefits, as well as the drawbacks, of direct sales business opportunities.

The Positives: What Are the Pros of Owning an MLM Business?

There are many positives associated with owning an MLM business.

  1. You are an independent business owner. By purchasing into the MLM company’s started package or starter level, you are essentially in business for yourself without having to think up the product, the packaging, or other aspects of owning a business.
  2. Most MLMs put considerable time, money and effort into building brand recognition. This makes it easier for their independent sales representatives to sell products. Since the company benefits when you sell products, it stands to reason that they benefit from putting money into their marketing. You do not need to spend the time or effort building up the company or product brand recognition if you choose your MLM product wisely.
  3. Many, although not all, MLM products can be sold online. This opens up opportunities for you to sell online as well as in person.
  4. You can set your own hours, so if you are a student, a stay at home mother, or have another job, you can fit your MLM sales activities in around it.
  5. Gain residual income even if you have an off month of sales.  If you recruit other people into your sales organization (also called a downline), and yet you don’t sell anything in a given month, if they sell products you’ll still earn some income. You can continue earning a residual income even if you are sick, on vacation, or take time off for personal reasons.
  6. No inventory to track. One of the huge drawbacks of owning your own retail store is inventory headaches. Not only do you have to pay good money to purchase inventory, but it must be carefully checked, rotated, sorted, priced, and stored. With an MLM company, the inventory is maintained by the company. Although you may wish to keep some products in stock, the majority of products that you sell are shipped directly from the warehouse. You do not need a retail storefront, warehouse, scanners, barcodes or any of that; the company does all the rest.
  7. Low risk: Starting your own business is risky. Most entrepreneurs quit their day jobs, and some rent office or business space. There are costs to start and maintain a business and you never know if your product will be accepted, liked, loved or loathed. Not so with MLM businesses! You can start with a known product like Avon, Mary Kay, LulaRoe, Pampered Chef or any of the other household names that people look for when they buy cosmetics, clothing, kitchen items, beauty products and more. By starting an independent business within a “known” company, you’re assuming less risk than starting with your own unique idea.

 

There are many other benefits of owning your own MLM or direct sales business, but these are the top ones mentioned whenever experts are asked about it.

In our next article, we’ll take a look at the drawbacks. See you there!

 

 

 

 

 

 

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