Guest Author - Deborah Crawford
If you believe that the home party plan business is right for you, and you know what you would like to sell, it's time to do some research on the companies you are interested in. Companies that sell home party or direct sales products vary in the way the do business. Here are some things to consider and question before you sign up:
1) Start-up kit costs. These range from free to hundreds of dollars. Be sure to find out exactly what is included, whether you need additional supplies not included in the kit, and if shipping costs are included or billed separately.
2) Distribution methods. Some companies will ship directly to the customer. Some will send orders to you for you to repackage and distribute.
3) Commission structure. These are different for each company. You need to know how much you will make, which is almost always a percentage of your sales, but percentages vary tremendously. Will you have to meet a certain sales "quota" or minimum in order to get paid? Do you get paid by check or do you deduct your commissions from what you send to the company for orders?
4) Tax Status. Most are independent contractor relationships. You will pay your own income and self-employment taxes. If you are an "employee", then the company deducts taxes and sends them in for you.
5) Territory. Does the company limit territories, or do they allow unlimited reps in any area? This could affect your income. If there are ten reps in your "area", it may be hard to find new customers.
6) Websites. Do they provide a website for you? If so is there a fee? Can you create your own website using their materials and information?
7) Ordering process. Is it web-based? Can you track orders and shipments online? Do you have to submit orders on certain days? What happens if you make a mistake?
8) Training and support. What is the training program? How do you learn about the products and company? How do you learn the process for demonstrating their product? What kind of support is there if you have questions or need help? How do they keep you informed of new products, procedures, company information? What is their return policy? How about customer service?
9) Sales materials. Do you pay for catalogs? Order forms? Packaging materials? Business cards? How do you obtain extras?
10) What is prohibited? Can you sell to friends in another state? Can you sell at flea markets? Can you sell online?
11) What is the company background; what is their financial situation? It doesn't cost much for someone to put up a website or send out direct mail, entice you to "sign up" and pay your money, then disappear. Start-ups can be a great way to get in on the "ground-floor", but you have to be extra-cautious to avoid being taken.
You can do research online to learn about compenies. Forums are a great place to talk to other reps about their experiences, but again, talk to several before deciding. Those recruiting bonuses can be pretty attractive and might induce some people to be a little less than honest. Try their product before you sign up, or at least attend a party and check out the product for yourself. Examine the quality and value just like you would in a store. Look at everything the way you would expect your customer would.
Once you choose a company and get ready to start making money, treat this business like any other business. Set up books, make a marketing plan, get your business license (if required), and spread the word! Soon enough, you could be making money at parties selling something you love. It will hardly seem like work, and that's the best "job" of all!
Wondering what it takes to be successful at home party sales? Read Success Skills for Home Party Businesses. And, to make sure you choose a company that matches your interests, read Choosing a Home Party Plan.
Not sure if home party plan sales is right for you? My ebook Finding the Perfect Small Business for You can help you find a business suited to your skills and interests.