Direct Selling Business Model

Direct selling is a retail channel used by top global brands and smaller, entrepreneurial companies to market products and services to consumers. Companies market all types of goods and services, including jewelry, cookware, nutritionals, cosmetics, housewares, energy and insurance, and much more.

The direct selling channel differs from broader retail in an important way. It isn’t only about getting great products and services into consumers’ hands. It’s also an avenue where entrepreneurial-minded Americans can work independently to build a business with low start-up and overhead costs.

Direct selling consultants work on their own, but affiliate with a company that uses the channel, retaining the freedom to run a business on their own terms. Consultants forge strong personal relationships with prospective customers, primarily through face-to-face discussions and demonstrations. In this age of social networking, direct selling is a go-to market strategy that, for many companies and product lines, may be more effective than traditional advertising or securing premium shelf space.

Millions of Americans from every state, congressional district and community in the United States choose to become involved in direct selling because they enjoy a company’s products or services and want to purchase them at a discount. Some decide to market these offerings to friends, family and others and earn commissions from their sales. The most successful consultants may decide to expand their business by building a network of direct sellers.

Eighty-nine percent of direct sellers decide to work part-time, offering busy parents, caregivers, military spouses, veterans and others flexibility and work-life balance. As advancements in technology create a new American economy whose foundation is built upon entrepreneurial spirit and independent work, it’s important to remember that direct selling is one of the oldest ways millions of Americans have chosen to work independently – long before the advent of the Internet. Direct selling has a long history of both substantially contributing to the economy and supporting the millions of Americans involved.

An Independent Salesforce

Direct selling is unique among retail channels because of the way in which products and services are marketed to customers. Instead of relying on traditional retail outlets or online marketplaces, direct selling companies maintain a salesforce of millions of independent workers that added $36 billion to the U.S. economy in 2015. Real estate, insurance, travel and technology companies and well-known brands also rely on independent workers to deliver products and services to consumers. Independent work adds value to those who choose to pursue it, to the economy and to society.

Independent direct selling consultants earn commissions on sales but work for themselves. They set their own hours, create their own marketing plans, determine whether to build a sales team and how to mentor those within it and how to serve their customers.

Millions of independent direct sellers see advantages in working for themselves. The most obvious is the chance to build and grow their own business and run it how they see fit. The freedom and flexibility to set their own working hours draws all types of people to direct selling, including parents with young children, students, caregivers, retirees, military spouses and many more.

Start-up costs for most direct selling companies are a few hundred dollars or less because direct selling isn’t reliant on overhead like real estate, facilities and equipment or traditional advertising that can cost tens- or even hundreds of thousands of dollars.