This week’s guest author David H. Hooker is the Executive Vice President of Strategy India, a leading direct selling consultancy firm. He is recognized as one of the world’s top public motivational speakers on the subject of direct selling. David began his direct sales career selling door-to-door over 40 years ago. Over the years, he has held senior executive positions with several major international corporations leading them to success with their international business development programs.
Guest Post by David H. Hooker
Retail Profit Goes in Your Pocket
In a previous article we talked about “Building Your Dream First”, for without a dream to go after there is generally no point in going on.
Donald Trump once said “It takes the same amount of energy to dream small as it does to dream big, so you might as well dream big.”
We also discussed previously the importance of developing your base of retail customers for that is the only source of guaranteed income that you have with Direct Sales/MLM.
Retail customers are also the best source of leads for more customers as well as potential individuals interested in joining your organisation.
I have always been fascinated by the number of misguided individuals who get caught in the trap of “well written hype” encouraging you buy into “The System That Has Made Me A Millionaire – just buy these CD`s, buy the book, follow the simple steps and send me $XXXXXXXX”.
This is typical of the thousands of such programs being touted on the internet today.
Are they effective? Yes, for the promoter.
Do they work? Who knows… waste your money and find out
However, with patience and soundly proven business building principles you can build a business to be proud of with substantial secure income.
Through the building of a strong retail base you will generate immediate income, positive referrals, as well as potential down-lines who love your product, know and trust the company, who understand the concept and who like and respect you.
One needs to remember that all the effort you exert now will reap rewards tenfold – that is if you think, talk, and act as a business person who wishes to build a successful and sustainable business.
Yes, you can seek guidance from your upline but my experience tells me that the upline guidance is generally provided purely for the financial benefit of upline and not the fledgling direct seller.
The challenge you will face is what faces most people which is income doesn’t fast enough or as fast as promised by your sponsor.
New direct sellers spend too much too soon to speed up the income process and finally start lying about the money they are making in an attempt to recruit others.
So here is the formula that I have shared around the world and that has proven to be the most effective formula ever – and it’s free!
3 Areas of Income
There are generally 3 areas of known income – Retail, Wholesale, Bonuses.
Retail is income derived from your personal sales to your personal customers. Wholesale income you earn as an override on the retail (personal) sales of your down-lines retail sales, and bonuses are earned from activities outside of retailing and wholesaling. The key however is what to do with these various income programs.
Retail Profit Stays in Your Pocket
Your personal reason for contemplating joining this industry was the need for additional monthly income and not necessarily for building an organisation.
The vast majority of people who fail to succeed do so because of their lack of desire to build a downline which they are encouraged to do so from day one by their uplines.
The average income in North America is circa $45,000. Based on that figure an additional $500 per month ($6,000 per year) equates to a 13% pay rise.To expect a pay rise 13% is way beyond the ridiculous, but imagine the possibility of being able to make that 13%/$500 per month through a relatively part time business opportunity – Please note the use of the word “Business”.
So you want a better lifestyle so let’s look at the ways and means to achieve that.
Find a product you like and could fall in love with.
Find a product that you would use continuously and could never be without.
Find a product that is truly unique, authentic, believable, ethical, and has good supporting documentation and market research.
Find a product that you want to sell.
Find a product that people want to buy.
Find a product that fills a need and that serves a purpose.
Use and become familiar with the product.
Don’t try to sell the product.
Talk about the product excitedly.
Tell people why you are using it, what it has done for you, and how it has changed you.
Get people to buy you first, then they too will try and buy the product.
This is how you start building a strong retail base with almost guaranteed monthly income. That being said nothing is guaranteed unless you look after and nurture your retail customers.Value them, put them onto your mailing list, and send them literature as well as info on all upcoming events, pop in for a coffee at least once every month for a chat.
Build a trusting long term relationship. An important point to remember is, do not try to convert your customers into direct sellers, and they have far more value to you for referrals and leads.
Don’t give cash rewards or discounted product for referrals, it eats into your monthly income, instead buy bunches of flowers, boxes of chocolates, toys for the kids, Easter eggs as tokens of appreciation.
Do share with your customer how much money you are making from these referrals, it demonstrates a viable business. By sharing this information you are automatically opening the door for them to ask you questions regarding joining your business.
One important point: DO NOT SPEND RETAIL PROFIT ON DEVELOPING AN ORGANISATION.
Retail profit goes in your pocket.
So, if retail profit ONLY goes in your pocket how you do finance the building of your organisation? Well, that’s where WHOLESALE PROFIT comes into play.
Wholesale profit is the income derived from the retail sales generated by your organisation. If retail profit goes in your pocket then wholesale profit “You Keep and LOCK IT” away for future development.
Retail profit is to be used for dinners out with your loved ones, going to shows, buying clothes, small home furnishings, weekends away, and those little extras that your current income cannot buy.
Retail income is for lifestyle.
As you slowly build your organisation place all income that is earned through their efforts into a jar or money box. Discipline yourself that the amount of money you spend and invest in your down lines and building will never be more than the amount in the jar.
Want to buy your downline a coffee, look in the jar. Want to travel to help your downline, look in the jar. Don’t spend what you don’t have – it’s called insolvency.
And never forget that your best recruitment tool is in others seeing your lifestyle improvements, your increased social life, and the continual smiling face that has been generated by the extra $500 per month going into your pocket from your retail sales.
Now for your BONUSES.
This is the additional area of income that is earned through organisational bonuses, cash incentives, status improvements, anything that is outside retail and wholesale profits.
What do you do with this money? Bank it and don’t touch it. Place it in high interest earning accounts, places where it cannot easily be withdrawn and then watch it grow. And when it has grown use it to buy private islands, helicopters, yachts, mansions, unlimited vacations.
Live your dream life.
So there you have it.
The straightforward and honest approach to building a straightforward and honest business.