Direct Selling

Explained
Caroline Tointon
Direct Selling Association (DSA)
 Direct Selling Association
(DSA)
• National trade association founded in 1972
• Represents more than 40 direct selling
companies that manufacture/distribute goods
and services through Direct Sellers
• Also referred to as distributors, consultants,
sales agents, associates and others
• All are independent contractors
 DSA: Mission
“To protect, serve and promote the effectiveness of
member companies and the independent business
people they represent.
To ensure that the marketing by member companies of
products and/or the direct sales opportunity is
conducted with the highest level of business ethics
and service to consumers.”
All direct selling companies agree to be bound by the Code as a condition
of membership. All direct sellers are bound by the Code when
representing a DSA member company.

Industry Code of Conduct www.dsasa.co.za

What is Direct Selling?
Direct selling is a dynamic, vibrant,
rapidly expanding channel of
distribution for quality products
through independent business people
Definition: Direct Selling
The sale of a consumer product or
service, in a person-to-person manner,
away from a fixed retail location,
where the company offers
opportunities to an independent
contractor sales force
 Definition: Multilevel
Marketing/Network Marketing
A compensation system within direct selling,
where a distributor/salesperson can earn
money not only on their own personal
sales, and not only on the sales of a person
personally recruited by them, but also on
sales of persons recruited by their personal
recruits
 Direct Selling Systems
• Classical Direct Selling, Multi-Level Marketing
(MLM), Network Marketing and Referral
Marketing are selling systems
• Variety of compensation plans (financial
reward) and administrative systems
• Main difference between Multi-Level
Marketing and Network Marketing - structure
and benefits of the COMPENSATION PLAN
 Classical Direct Selling
• Selling products directly to a wide customer
base, earning financial rebates or volume
discounts on all products sold
• Emphasis in classical direct selling is for
the direct seller to sell products to a wide
base of their own customers, thereby
earning rebates on all products they sell
Multi-Level/Network Marketing
• A marketing system where individual direct sellers
recruit, train and develop a team of product users
• These new direct sellers also recruit, train and
develop their own team of product users, who also
recruit, train and develop their own team …
• BASIC CONCEPT is that any individuals sales
performance can be multiplied by using the efforts
of others through a network of people who work
directly for themselves and indirectly for the
person who introduced them into the network
 Methods of Direct Selling
(within the direct selling systems)

• Person-to-Person
• Party-Plan or Group Presentations
• Unique company marketing
techniques
 No Barriers
•
Men/women across all age groups have achieved significant success – 18’s

to 80’s!

•
No fixed education requirements or previous experience needed

•
Direct selling companies provide all the training to get started and to grow in

the business

•
Ensure you select a DSA member company – go to www.dsasa.co.za
 Cost of Getting Started
• Cost to start an independent direct selling
business is typically very low
• Usually, a modestly priced sales kit is all
that is required to get started
• In sharp contrast to franchise and other
business opportunities, which may require
substantial initial investment
7 reasons why people join a
Direct Selling Company
1) Wholesale / Discount buyers
2) Short Term sellers with specific objectives
3) Part Time sellers
4) Full Time, career orientated sellers and business
builders
5) Social Reasons
6) Recognition
7) Need to share the benefits of the product and
company
 Earnings Potential
•
Income generating – limited only by amount of time, effort and dedication invested

•
Entrepreneurial opportunity (business-within-a-business)

•
Personal growth – training, mentorship, recognition

•
Developing others – share same opportunities and benefits you have enjoyed

•
Merchandise and travel incentives

•
Potential of building a residual income stream
 Total Sales
2007 2006 Growth
R million R million
South Africa 4,541 3,941 15,2%
Africa 862 735 17,2%
Total Sales 5,403 4,676 15,5%

R 5.4-billion industry in 2007 - growing

 Number of Sales People
2007 2006 Growth

Regular Users 683,000 521,000 31,0%

Sales People 251,000 208,000 20.6%

Total Sales People 934,000 729,000 28,1%

Almost a MILLION people involved

 Product Mix
Product 2007(%)
Household Goods 26.99
Health & Wellness 24.29
Cosmetics 7.04
Financial Products 15.54
Personal Care 10.96
Other 4.41
Fragrance 7.33
Jewelry 3.44
100.00%

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