Millions of women and men celebrate their independence from financial struggle and unfulfilled career paths by starting a direct sales business. According to the Direct Selling Association, “15.9 million people are involved in direct selling in the US, and more than 90 million worldwide…they are micro-entrepreneurs.” If you’re considering a leap into direct sales, look for DSA member companies who follow a strict code of ethics. As a 24-year direct sales veteran, I frequently hear whispers about “pyramid schemes” and “making money off of people". Here are 5 of the biggest direct selling myths, and what you can say when a whisper comes your way:
Myth #1: Direct Sellers Make Money “Off Of" People
Truth: “You make money off of people,” is one of the biggest misperceptions about direct selling. My standard answer to this is, “Actually, my sales team makes money off of me.” The response is usually a very confused, "What???". Here’s the lowdown: Saying that direct sellers make money off of people is like saying your dentist makes money off of you. Both Dentists and direct selling entrepreneurs provide a service, and they expect to be compensated for their time and expertise. When someone starts a direct selling business, their “upline leader” is their business coach, providing hours of free training, support, motivation, recognition, mentoring, hand-holding and belief. Few entrepreneurs could succeed without this type of support, unless they hire a business coach whose fees range from $200 to $3,500 an hour. Direct sellers get business coaching for free, because their “upline” is compensated for their time based on the results they achieve. That means that direct sellers can only earn an awesome income if they invest time and money to coach other people to earn an awesome income. Now, imagine if the corporate world worked the same way. Your boss would be paid in direct relationship to how successful you become. Pretty great concept, right?
Myth #2: Direct Selling is a Pyramid Scheme
Truth: Pyramid schemes are illegal, so hopefully the pyramid police would be onto master criminals like the Mary Kay lady, who’s been around for 53 years. The confusion starts with the direct selling lineage program, which looks exactly like a corporate organizational chart, both of which are pyramid shaped. On an organizational chart, the CEO is at the top, VPs next, Managers in the middle and the worker bees at the bottom. Can the worker bees and middle managers ever get to the top? Highly unlikely in the corporate world today. On the contrary, any direct seller can start a business today and exceed the income of their upline leader(s), based on how much work and effort they put into their business. Like any entrepreneur, direct sellers are paid based on their hustle and do not sit back eating bon-bons, getting rich on residual income. As Smith-Barney says, they make money the old fashioned way…they earn it.
Myth #3: Direct Sellers Are Not Serious Entrepreneurs
Truth: Don’t assume that all direct sellers are hobbyists who are not serious about their business. By the way, even hobbyists are pretty passionate about their hobbies. Every industry has to deal with myths and assumptions, so I get this one. I’ve even been told that I wasn’t invited to join a networking group because, and I quote, “Direct sellers are not serious entrepreneurs. Our members are, like, lawyers.” I felt like Julia Roberts in Pretty Woman, but didn’t get the chance to go back and say, “Big Mistake. Huge.” Instead, I founded a successful start-up which includes an Amazon #1 best-seller, online training for women entrepreneurs, a live Entrepreneur Boot Camp and radio show. Rejection can be a huge motivator. Before you prejudge anyone, get to know more about them and their business. The direct seller you meet might be a Million Dollar Party Girl with a huge network, that could provide expertise and connections for you.
Myth #4: Direct Selling Parties Are Outdated
Truth: Direct selling was the original social network, way before Facebook came into town. Mary Kay and Tupperware wrote the book on connecting women to their families and friends, while catching up on kids and life. Social selling is even more relevant today. What retailers and big box stores lack in customer service and relationship-building, direct sellers excel at, providing a personal one-on-one shopping experience. Ladies Night Out shopping parties, with a glass of wine on the side, are a popular trend. If you want to support a small business owner whose profit goes back into their community, including basket donations to your school and church auctions, call a direct seller and plan a fun Ladies Night Out today. We’ve come a long way, baby.
Myth #5: Direct Sellers Are All Work-At-Home Moms Who Lack Education & Skills
Truth: I find that most direct sellers today are college educated, hard working women and men who are sick of the corporate crap and embrace entrepreneurship to make a better life for their families. Or, they are retirees who need to reinvent themselves to supplement social security. Thanks to free business coaching and training, a direct seller start-up can learn how to become an expert at marketing, sales, customer service, business development, event planning, negotiation, online marketing, public speaking and story-telling. Looking for a seasoned small biz expert who’s a great story-teller, just ask a successful direct seller, who got their “MBA” in small biz by attending workshops, conferences, personal development courses and good ‘ol working their butt off.
Lynn Bardowski is an award-winning entrepreneur, radio host and best selling author of Success Secrets of a Million Dollar Party Girl. She speaks to global audiences about entrepreneurship, vision and branding and is a resource for press, media and bloggers. Like her on Facebook and follow her on Twitter. You may republish this article in full, as long as you list this paragraph and provide a link.