Joining a Direct Sales Company - What Should You Be Looking Into?

Due to the recent misfortune of literally thousands of consultants affected by the demise of a yet to be determined scam, we decided to interrupt this week’s issue of our mini series. We will return with our ongoing mini series next week. In the meantime, our thoughts go out to consultants who were affected by this unfortunate event.

Joining a Direct Sales Company - What should you be looking into?

First of all, it can’t go unsaid that we’re recommending that you never join a new company. If that happened then there would never be any new companies started. There’s always room for more. Don’t forget - even the most established company can go under for whatever reason. What we are saying is if the company is brand new - proceed with extreme precaution.

Free is NOT always good! One of the main reasons companies charge a start up fee or more commonly require new consultants to purchase a start up kit is to make you actually put some thought into what you’re about to do. These companies want consultants who are truly interested in selling - not just looking for another freebie. Remember, quality wins over quantity ALWAYS.

The common statement I love is the ... "But it’s free, what do I have to loose?" This statement is only semi-good if you have absolutely no intentions of doing any recruiting until you’ve fully tested the product, pricing and shipping yourself. How would you feel if you’ve recruited a bunch of prospects into a company only for it to turn out to be no good? Your reputation is one of the most expensive things to loose - that no amount of money is going to buy back. Your reputation - that’s what you have to loose.

A growing company is wonderful! To watch a company grow day after day is a beautiful thing. But, growing too fast is a horrible thing. No matter whom the owner of this company is ... this person is still human. To grow by the thousands in a few weeks is next to impossible to keep up with.

There are a few points to look for when considering joining a new direct sales company.

1. Has the company been around before the consultant program?
If it's brand new and opening with the consultant plan in place, beware! While this isn't always the case, do think twice about a company that hasn't been able to sell the product on their own.

2. How well was the business planned out?
Don't be afraid to ask personal questions! You have a right to know if they have planned their costs out for several years. Regardless of the business, a business owner must understand there is a slim chance of any profit being made in the first year. If they haven't planned to be in debt for at least a year or more, then chances are they will cut their losses before the year is even up. Should they not reveal their business plan, you might want to just move on.

3. What type of shopping cart do they use?
While there's nothing wrong with PayPal, if this is the only type of payment offered by the company you may want to think twice. A professional shopping cart set up doesn't cost that much, and if that cost has been skipped they may not be planning well.

4. Are catalogs and samples available?
If you get a "coming soon" when requesting a catalog, think twice about joining. Catalogs are a very basic part of business, and to not have those ready shows the owner "rushed" to get the business open.

5. How is customer service?
Put in a test order and see how fast things work in the business. If you can't order products yet, but reps are being signed up already, you'll want to wait until they are fully open before actually signing up yourself. Not being able to test out products ahead of time isn't a good sign.

No matter what business you choose, you will always be taking a risk. However, following the basic guidelines above you should be able to minimize your risk and join a company which will be around for a long time. ;-)