What is Direct Selling? Why it is NOT Profitable Anymore?

what is direct selling

In this post, we expose some dark realities which most people ignore about Direct Selling.

Before moving further, I want to convey, that I am neither considering nor against to direct selling industry.

So, Let’s take a deep dive into it without any further ado.

What is Direct Selling?

Direct selling is a form of retail in which products and services are marketed directly to consumers without involving suppliers and wholesalers.

In Direct Selling products are sold on a person-to-person basis or sometimes through catalogs or online.

Direct Selling companies engage their direct sellers which are often called distributor, associate, or affiliates who gets a commission on every sale.

Affiliates work as marketers and retailers of the company. They get products from the company at wholesale price and sell to the customer at retail price to earn their respective commission.

In the service-based direct selling company, direct sellers refer new customers on behalf of the company and earn their respective commissions.

Read: What is MLM? How does it differ from Pyramid Scheme?

Types of Direct Selling

There are 2 types of direct selling. Many people get confused between the types of direct selling let’s see what they are.

1. SLM (Single-Level Marketing)

In Single Level Marketing, distributors can directly join the direct selling company, sell products and earn a respective commission and incentives.

2. MLM (Multi-Level Marketing)

In Multi-Level Marketing, distributors not only sell the product or service but also recruit new distributors in their downline for the company. The distributor gets the commission for both- the sales they made and the sales made by their recruited downline.

Read: Life Activated Brands Review

Pros and Cons of Direct Selling

There are some Pros and Cons of direct selling:

Pros:

  • low start-up costs
  • flexible working hours
  • work from anywhere
  • a low-risk way to run your own business
  • bonuses and incentives, including travel tips and discounts
  • any age person can start direct selling
  • helps to build communication, marketing, convincing, and presentation skills
  • offers flexible working hours and location

Cons:

  • creates conflicts in their relationship with family and friends
  • commission structure can vary
  • risks if you buy more stock than you can sell
  • success depends on your communication skills and social networks
  • the success rate is very low just 0.4% in direct selling
  • overpriced products that are difficult to sell

Read: Beachbody Review

Direct Selling is NOT Profitable Anymore

Direct selling is a form of retail in which products and services are marketed directly to consumers without involving suppliers and wholesalers.

In reality, direct selling works on a distributor network, on every sale company needs to share some percentage of profit with the distributor’s network. Hence most direct selling companies increase their product prices to get enough commission to share with distributors.

Therefore, indirect selling the term DIRECT lost its role in MLM, now it become the same as traditional selling.

Is direct selling a good career?

At the present meaning of direct selling is MLM, almost all well-known companies operate on the MLM business model. Most MLM offers overpriced products to their distributors to purchase and sell and that is completely not suitable for everyone to buy and sell.

Moreover, the success rate of MLM is just 0.4% which is extremely low to build a career.

The decision of making a career in any MLM company completely depends on you, on your personal skills and interest.

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3 thoughts on “What is Direct Selling? Why it is NOT Profitable Anymore?”

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