As we step into a new year, I have brought together a collection of thoughts and views from a group of distinguished individuals from the global direct selling industry. I would like to extend my gratitute to each of them, for taking the time at the most busy period of the year.
(Please click the name if you wish to go directly to that person’s comments: Richard Berry, Dr. Stewart Brodie, Maurits Bruggink, Alessandro Carlucci, Jacques Cosnefroy, Miroslaw Lubon, W. Alan Luce, Joseph Mariano, Sergio Pompilio, Paul Southworth, Garth Wyllie)
“With many European states now facing the prospect of sliding back into recession, the prospects for direct selling businesses could not be better – if we all remember two facts.
The first is that, at its best, direct selling is a channel of distribution for predominantly essential consumer products. Current worldwide direct sales in excess of $130 billion is impressive, but it still only accounts for under 1% of the retail market for similar products. In gaining a much bigger share of this market, which is attainable, our competitors should not be other direct selling businesses, they should be conventional retailers and e-commerce businesses, over whom we have a unique advantage – personal explanation, recommendation and endorsement and a far better personal service.
The second is that, direct selling is proven to be largely impervious to economic conditions. Many of today’s largest, longest established and most successful direct selling businesses were founded in difficult economic times. They grew and prospered because they offered something else that was in great demand – independent earnings opportunities. Even today, many of those who have gained their first experience of business with a direct selling company, have gone on to create other businesses – to the benefit of national economies. This is a message we all need to deliver to Governments around the world – to gain their support and encouragement for direct selling.”
“There have been several national and international economic downturns during my direct selling career that started in 1963. However, the basic fact to remember, as we move into 2012, is that direct selling tends to defy recessions. This is simply explained by the fact that, in an economic turndown, people need to supplement their income or, because of redundancy, are looking for a new, full-time, earning opportunity.
Many people will be considering starting their own business. There is no better or simpler way for them to enter self-employment than to start as a direct seller running their own micro-enterprise.
Changing demographics and increasing life-spans mean that these new opportunities are being sought and chosen by more people aged over 50, by more males, and by more couples working together.
Direct selling organisations have these opportunities available now for these people. In direct selling there is no gender, age, ethnicity, education, or disability discrimination, and virtually anyone who has the ability and desire to work hard can become a successful direct seller.
What a great time to be involved in direct selling!
With every best wish for the Festive Season and a happy, peaceful and prosperous New Year!”
“Direct selling has much to offer to help countries getting out of an economic crisis: entrepreneurship, self-employment, personal development, female empowerment, returning people to the labour market and development of remote areas. Just to name a few.
It is therefore the right time to appeal for better regulation and more promotion by, and recognition from governments. Promotion and recognition will increase the interest to become direct seller and will make recruitment more successful. In addition to education and training, it is important that the direct seller has a recognised status as independent contractor that will allow him or her to get the appropriate tax and social treatment.
Better regulation should remove the existing barriers to the trade in the Single Market. Direct selling of certain types of products is still restricted in some countries, mostly without any justification. For all these reasons, 2012 will be a crucial year for Seldia and national DSAs, who will have to champion our call for more recognition of direct selling.”
“Next years, starting by 2012, will be extremely important for the industry and we have the opportunity to help society re-imagine our industry and show its relevance today in a continually changing world, suffering the impact of social and environmental challenges.
It is in this context that all of us can communicate and demonstrate to the world the important role of the direct selling industry, in building networks and mutually enhancing relationships, that promotes prosperity for people and the planet.
We also perceive that the world is being transformed by technology and social medias. Everything is changing, business, relations, consumers and society as a whole. In this complex context, where knowledge is still incipient, direct selling companies face the challenge of evolving.
However, in face of this challenge, I also see many opportunities. Network acting is already in the essence of our industry. In this manner, in an increasingly connected world, we can make direct selling increasingly innovative and attentive to society’s challenges and needs.
During the next year I also see that we have the opportunity, with the active participation of a multidiverse group, of having a WFDSA deeply committed to working for the industry as a whole, regardless of the size, nationality, or business model of our companies. This is our commitment.”
“The direct selling industry has been stronger than other business industries during the crises and we have been able to observe this tendency since the last decades in France, in the Euro zone and in the United States.
Nevertheless, a study from the CREDOC (a private research centre) shows that the French industry is late in comparison with the industry in other countries such as Germany, the United Kingdom and Italy.
However, the direct selling industry is seen as being a strong industry regarding the labour market. Thus, the study aforementioned shows that we can expect that between 600,000 and 800,000 people will be working for the direct selling industry in France by the year 2020.
As for the expected situation of the industry in 2012, if we take in account that the economical recession is likely to be hitting France, we can expect that some unemployed people will arrive on the labour market and thus will be looking for a new professional activity. In this context, the direct selling industry can be seen as an answer. This labour dynamic will probably be enhanced by the fact that the French law provides different status for direct sellers that allow young people, seniors and disable people to work and this without any specific academical background. Regarding this aspect, the French Direct Selling Association (FVD) has been striving over the past year to create several distance learning diplomas for the direct sellers.
Lately, the direct selling industry in France is seen as creating jobs, wealth and brands. For instance in 2010, 35,000 jobs were created and the global turnover for the industry was Euro 3,8 billions. We expect that this tendency will be amplified in 2012.”
“Forecasting the future, notably in economy, is always risky. The present market turmoil makes the task even more difficult. For, on the one hand, the spreading financial crisis and economic slowdown, if not recession, should prompt us to expect worse results in 2012. But on the other hand, the industry proved more than once in the past that, while not being totally crisis-proof, yet it can cope successfully with similar economic challenges. What more, a difficult situation on the labor market, should, theoretically at least, result in easier recruitment, and in the final run – in bigger sales.
Naturally, the prospects are not identical for all companies. In Poland at least direct selling firms offering mass products like cosmetics, small household goods or fashion articles, will probably fare pretty well in the coming months. The more so that the Polish economy has so far been on the safe side. Companies selling high ticket products may expect a worse year, but how much worse, is impossible to say today. A lot will depend on the exchange rate of the Polish zloty against the euro and the dollar: the current trend favors exporters rather than importers, while most of the companies operating here belong to the latter category.
As always in such situations the potential success in sales will depend on the quality of the field force. Hence the importance of the recruitment process, but first of all – of the training given to these people in motivation, communication and negotiation skills. The companies prepared to take on this challenge should not fear the months ahead.”
“Our experience with a wide variety of US and international clients in 2011 has proven conclusively that the convergence of direct selling sales methodologies is continuing at a rapid pace. It is almost impossible today to find a “pure” MLM marketing program or a pure one-on-one or a pure party plan. Almost all companies today find, sometimes to their surprise, that their enterprising sales people are using all of the traditional sales approaches depending on who they are talking to and in what setting. Then to top it off, they are selling online also, not just for re-orders on their replicated websites, but for first customer contacts resulting from Facebook, Twitter and LinkedIn associations.
There is no reason to believe that this trend will not continue and even strengthen in the coming year. As usual the independent sales force is often out in front of their companies when it comes to employing technology in innovative ways and exploring their own way of doing things. Coping with these trends requires all companies to be ever more nimble when it comes to adapting to the realities of the marketplace. For 2012 change and adaptation move from the periodic and unusual to simply the normal way of doing business. Be ready for it!”
“How can one not be optimistic about the future of direct selling? To be sure, there is still uncertainty in the global economy and business leaders are generally worried that that lack of confidence will hurt their enterprises. Direct sellers, however, are well positioned to prosper and take a leading role in leading the economy out of the doldrums. Aside from our natural leadership in consumer service and education, our model provides the ideal mix of quality products, extraordinary opportunity for individuals, and the appeal of social networking. Other business models are just now catching on to what direct sellers have known for years – the power of the social network combined with the opportunity to benefit financially can be a powerful force in the market.
2012 will have its challenges. As an industry, we are still only a small percentage of total retailing, and I have challenged direct sellers to double our overall sales and number of salespeople in the next few years. 2012 is our starting point for that growth agenda. Issues of reputation and misperception of our model persist in some markets, and we must demonstrate our longstanding and continued commitment to protecting our customers and salespeople. And we must deal with government regulation, ensuring that it is undertaken reasonably and only when necessary.
Fortunately, Direct Selling Associations across the globe, coordinated through our World Federation, are meeting the challenges. DSAs are pursuing a wide ranging agenda, with the establishment of Codes of Ethics and complaint resolution processes, industry research, and press and government outreach. Through their DSAs, direct selling companies are working together to ensure that our industry is the world’s economic and business leader of the future, providing opportunity and product to hundreds of millions of customers and salespeople worldwide.”
“I believe that Brazil, as an emerging market, will continue growing thanks to the income growth and the increasing number of people at middle class with a great power of consumption despite the recent slowdown. The direct selling industry in Brazil is very concentrated in the CFT category – almost 90% of the sales. In this sense, there is a great opportunity of growth for other categories like household goods, clothing and accessories, wellness and services. Nevertheless, the beauty market will remain strong mainly because of the new entrants to the direct selling channel. In addition, the current government has encouraged the micro-entrepreneurs, creating mechanisms which reduce bureaucracy and tax burden of the direct sellers. More and more people will get interested in doing direct selling business.
Thus, I foresee that the direct selling remains a compelling growth opportunity in Brazil.”
“Recently people have been continually asking me how direct selling can possibly survive in such a volatile economic climate that surrounds the whole of Europe today. Indeed many are using such words as “disaster” and “collapse” and generally spread the message of gloom and doom.
I, on the other hand, think entirely differently. As we stand at the beginning of another New Year I only see a new dawn of opportunity as people look for an alternative way of supplementing their incomes and realise that direct selling is the answer.
This isn’t just optimism on my part, this is supported by recent trends here in the UK. We are seeing a 29% increase in people over 50 joining direct selling companies, a 25% increase in the number of men joining, an ever increasing interest from students and our mass market of direct sellers contributing many more hours to their business.
These statistics prove that our industry is one of the few that is actually thriving in these tough times and is truly offering a viable alternative as an earning opportunity.
Therefore as many more micro businesses emerge I applaud our direct sellers and look forward to 2012 with a great deal of hope, optimism and confidence.”
“The world’s developed economies are going into 2012 filled with doom and gloom about economic prospects and downsizing of governments and government spending. Traditional retail is flat and margins are thin for suppliers and retailers alike and large supermarket chains are looking to reduce supplier lines in favour of house brands and big advertising budget brands.
Perfect market conditions for direct selling. Companies need to promote that we can still sell products, create incomes and grow business.
Yes, we have to believe Europe will find a way through its Euro woes and the US will stop borrowing and start growing again with both economies on a much more sound footing than before. That should not stop direct selling companies filling the gaps that are evident in product diversity and income opportunity. Those that can build multinational business opportunities can and will grow faster than those that cannot but all should be able to grow against this backdrop.
The powerhouse Asian economies continue to grow at numbers both Europe and the US would dearly love to see but there is opportunity in that growth for both US and European direct selling companies that still remains. The only danger I see with the Asian economies is that of over-regulation
Markets like New Zealand, while small in world terms, are well past the financial crises and with low unemployment and high export numbers into Asia, poised to offer direct selling companies good future growth due to spending power.”