Saturday, March 25, 2017

My Experience With A Direct Sales Company

For my first post of this new beginning, I decided to start with a story about what I have been involved with recently.  I hope I can tell it in a clear and concise manner.  Anyone who knows me, knows that I can be all over the place with multiple thoughts.  So here goes.

After settling in to our new house, I was looking for something interesting to do.  I am not very good with computers, so I was thinking about various ways to learn some important skills that I could then use for my Etsy hobby.  I mean business.  I looked into actual local colleges, and couldn't find a single course that looked like it would help.  Sometimes, when you don't know much about something, you just have no clue where to look.  This is when I ran across a direct sales company that talked about training people to sell on line. 

I studied a company called LuLaRoe, for days.  Yes, I really spent all day for a week reading everything I could find, and watching hours of YouTube videos.  Unfortunately, their fan club at the Better Business Bureau wasn't going so well.  I then found out that the owner of LuLaRoe had a niece with a similar company called Agnes and Dora.  After looking at this company, I decided to give it a try.

 Now, keep in mind that I approached this as an internet marketing learning experience.  I in no way, was going to do this forever.  I also didn't plan to have to bail out as soon as I did though.  I did learn a lot about marketing on Facebook, and some ideas for Instagram and Periscope.  I also met some really nice ladies who have put a tremendous amount of time and money into this business.

My husband gave me a $7,000, interest free for 18 months credit card, to start my new venture.  When you start with this company, you have to buy a kit consisting of inventory to sell.  The kits at that time (just a few months ago) were priced at $2,500, $3,500, and $5,000.  As to be expected, you can find a lot of testimonials about how women made back their initial investment in days or even a few weeks.  I was not such an optimist.  I was here to learn marketing.  I figured that I could definitely do something in 18 months.

It took a while to get my kit.  I paid at the very end of October and received my inventory mid December.  I signed a contract and paid for my kit up front.  Not but a few days later, I received a new policy about how the company was not going to take back damage merchandise.  They named it a cutesy name by combining the words flaw and awesome.  Yes, a flawsome policy.  Unless the garment had been annihilated by rabid chipmunks,  they would not take the item back.  Instead, you could be sweet and donate the item to a local shelter.  In other words, you would just have to eat this.  Let me expand on this thought a little.  When you signed the contract, it basically said that you would abide by the policy and procedures, but those could change with the direction of the wind.  Also, these clothes are sold to you whole sale and then you mark them up 100%.  Actually, the clothing was bought by the company whole sale, and then they marked it up and sold it to you. 

I knew all about the pricing of the clothing and I still ventured into this.  Just telling you this so you will be aware.  The same leggings that sell for $22 can be bought from amazon for $9 to $11.  You have to pay shipping of at least $4 from an A&D rep, but Amazon shipping is free.  Same leggings from the same distributor.  Needless to say, I was not thrilled to get over 100 of these things  in my start up kit.  I had to pay $11 a pair from the company. 

The products from this company that I did like were the skirts and dresses.  I can't tell you how many times I have tried and failed to find a good dress or skirt.  The skirts all have a yoga waist band which insures a good and comfortable fit, and the dresses are classic A line dresses that are flattering to most body types.  I never left the house in one of these dresses where I didn't get a ton of compliments.  The price points are really good too, and I highly recommend that you buy some of these dresses and skirts. 

The only problem is that purchasing these products can be slightly difficult.  You almost have to be on Facebook, and may have to join many groups to find what you like.  I found this to be very restrictive.  Most people who wanted the dress, just didn't do Facebook.  You could also go on Periscope, but most people don't have a clue what that is, nor do they want to put the app on their phones.  The other option is the dreaded house party.  I had so many people tell me how they hated to be invited to all of these home parties, and felt obligated to buy the products even if they didn't want them.  I saw tons of on line complaints about home parties.  I am new to this area and don't know anyone, so that was one reason I couldn't do a home party.  The other reason was that I would feel terrible if someone felt forced to buy something I was selling.  Basically, I was stuck with on line sales.  I was told that I could do this quite easily, but that just wasn't the case.

On line selling is not easy.  This company had great training on the use of a few select internet platforms.  Unfortunately,  It takes a ton of time.  Growing a group on Facebook is not easy at all.  If you have any problems with bothering people (like I do), you are not going to get far.  Some of the girls who were doing really well, had come with a huge following from another direct sales company.  They hit the ground running.  I hit the ground with a sound thud.  In an effort to get people interested in joining my sales group, I made style photos.  This did start to increase sales, but it was only at a trickle.  Which was totally fine with me.  Some of these ladies were so swamped with sales, that they literally could not even take care of their homes and families.  This time suck definitely couldn't fly with me because I have so many other interests, and I just couldn't spend the huge amount of time on this project.

I was told to build deep in my inventory, meaning that I needed to stock my store with many variations of one style.  I decided to get 8 different prints in each of the 6 sizes.  This worked out to cost me about $1,400 per style of dress.  I picked 4 styles of dresses, and 3 styles of skirts.  I didn't reach my goal though, because I started to become very cautious. I built my inventory to a whole sale cost of about $5,700 and quit.  I began to believe that the advice I was given was not correct.  Do I believe that I was lied to?  No.  The women, in charge of teaching us, were just giving out the best advice they had available at the time.  Over time, the advice evolved into collecting at least 800 to 1,000 pieces, and get the newest and hottest things.  Oh, well.  I'm learning.

I began to notice that the platforms, that we were taught to sell on, were becoming a little tired of our presence.  Facebook started putting people in Facebook jail.  Yes, that really is a thing.  They block you out of your accounts for a period of time.  Periscope disabled the links so people could not pay for their purchases.  I think that in the future, these platforms may just toss everyone off.  That's okay, because I actually learned to use these platforms correctly.  I have new uses for them moving forward.

Then one day, came the dreaded contract.  This baby had some teeth.  Being fearful of legal entanglements, and also tired of constant changes, I decided to cut my losses and run.  It is not easy to sell off your inventory.  I got about $3,300 back, and have several boxes of winter stuff that I will re-offer to the other reps this fall.  The other reps just can't absorb all of the old inventory.  They are trying to buy new and interesting stuff to keep up their sales momentum.  I figure that I only really lost a couple thousand from my adventure, and figure that the things I learned, more than makes up for that.   So I guess you could actually call that a win.  

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