Direct Selling Business: Thriving in an Economic Winter

polar-bears-face-to-faceGreat article; thanks Brad for sharing.  Excellent advise for all that are doing their part to educate and mitigate toxins from our lives.  Green jobs galore!


… by Gordon Hester

As business owners and executives, one of our primary functions is to create momentum, regardless of the challenges facing our business. Our value is often defined by our ability to drive the top line and enhance the bottom line. No one has to be convinced these days that we are in an economic winter; we are reminded every day. The key is to turn challenges into opportunity and growth!

History teaches us that adversity, chaos and uncertainty are often the catalysts for opportunity. Companies like Microsoft, Southwest Airlines, Disney, Genentech, McDonald’s, Johnson & Johnson and Krispy Kreme started in economic downturns. When apprehension becomes the norm, those with answers to abate those fears often make fortunes. As a leader, it is important to embrace these times as great opportunities. Now is the time to communicate a positive message to your staff and field. Excitement and optimism are as contagious as fear. As leaders, your attitude and demeanor often become the example for the entire company.
Here are some components of this business model that explain why the industry shows consistent growth.

Low Startup Investment. Not everyone has money or access to money. This model works in all economic climates because it allows anyone the ability to start a business. The financial risk is typically minimal; therefore, one can start a business without borrowing money or seeking outside investors.

Low Fixed Expenses. Many businesses require physical structures or space, large inventories, employees and huge investments of time and money in innovation (research and development, product development, etc.), therefore limiting the number of entrepreneurs who can run these types of businesses. Perhaps this is the single biggest reason there is a strong trend toward home-based businesses. Home-based businesses now represent 52 percent of the 27 million small businesses in the United States. It is a growing trend.

Path to Quick Profits. There are two keys to a quick profit. First, the more money required to start and operate your business, the longer it usually takes to recover and earn a profit.

Second, if there is a need for an extensive and lengthy training period or the need for extensive research, it will also take longer to reach profitability. Traditional business often takes years to earn a profit. With direct selling, that time period is often reduced. As mentioned previously, the startup and operating capital for a direct selling business is very low.

Because direct selling companies provide quality products, services, support and a host of other systems and processes that have already been extensively researched, the only real learning curve for a distributor is using what is provided to build a successful business.

Time Flexibility. The majority of people interested in starting a home-based business are not in a financial position to work any business model that requires them to start on a full-time basis. This is especially true during troubling economic times, when a job is often the only way to survive. The direct selling business model allows you to start and work it part time. It is a model that allows a new distributor a means to replace their full-time income over time.

To capitalize on a direct selling opportunity, our distributors need to execute the right business strategies. The following are a few key strategies to implement if we want to profit in a financial downturn. Let’s look at a couple of customer and distributor strategies that could enhance momentum in the current economic climate.

Customer Strategies

Strengthen Belief.  In challenging economic times, customers budget their money. It is critical to make sure the end consumers understand the value of your product or service. Belief can be the difference between a long-term customer and a lost customer. Remember, satisfied customers are your best source for distributors, so going the extra mile to earn their business is a good strategy, especially in an economic winter.

Share the Opportunity Story with Customers. People think differently about expenses and income. Often, expenses are viewed as a negative, where income is viewed as a positive. This is never truer than in an economic slump. There are two simple strategies to share the opportunity.

First, work on a customer referral program. In other words, have current customers refer enough new ones so they can get products for free. This is a great first step in the business process for some customers who are cautious or have reservations about the business. The second option is to present the business opportunity to every customer. For those looking for an income, the opportunity is the fastest path. It also stabilizes them as a customer, because they now have an income tied into their product or service usage.

Distributor Strategies

Operate with a Recruiting Mentality. This is opportunity time for the direct selling business model. Therefore, it is important to focus on the activities that result in more people coming into the business. Most important to maintaining a recruiting mentality in your business is to keep a focus on sharing the opportunity, sharing the product/service, and retention of both distributors and customers. Don’t let any other aspect of the business become a distraction or distributors will not be able to maximize their time.

Stress the Importance of a Relationship. This is a “relationship business,” which means relationships are required for long-term success. One of my core business beliefs has always been that long-term relationships equal long-term success. It is important for distributors to understand the importance of relationships and to build their identity in the marketplace as people who serve others. Remember, in an economic decline, people are generally distrusting.

It is important that both companies and distributors learn to under-promise and over-deliver on any sales, product or recruitment message. There is an old adage in business that is valuable for your distributors to understand: You cannot fill a leaky bucket. Retaining customers and distributors becomes the strongest path to long-term growth. Experience has taught me that a failed relationship is the biggest liability in any business.

As a company, focus your teams on what makes the biggest difference. In tough financial times, remember to focus your time and money on the big four:

  1. People
  2. Proven systems/processes
  3. Innovation
  4. Personal development

From my point of view and experience, spending time and money on these four areas will have the greatest impact on the top and bottom lines of any business. Now is the time to focus and invest. DSN

Hester GordonGordon Hester is a business and financial momentum expert with more than 25 years of real world experience. For more information, visit

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