I'm sure this is a question you've asked yourself at some point. If you've been around for awhile, you may even know the answer. However, there are many African American women in the Direct Sales AND Network Marketing profession today that are not really sure what the differences are. First, let me answer the question....No, direct sales and network marketing are not exactly the same. Understanding the difference will help you determine which opportunity is best for you, especially if you are contemplating joining the industry. If you are already a distributor or consultant in the profession, it's great to know the difference so you can speak intelligently on the subject.

Most industry experts agree that network marketing IS a part of the direct selling idustry and concept, where products or services are offered on a one-on-one basis and sold direct to a customer from the distributor or independent consultant. However, the two approaches offer very different benefits to the distributor or independent consultant.

Lets take a look at direct sales first. Direct sales companies are more "seller-based", meaning they usually give more income (commissions) to the consultant/distributor when she makes a sale at the retail price. Most direct sales companies market more high ticket, one time purchase products like cookware, water filters, art, etc.
The kinds of products that customers will more then likely only buy once. Because of this, it makes more sense to pay the distributor more money when a retail product is sold. The person selling the product usually earns a higher percentage then their "upline" or management in this case. In a "true" direct sales company, the distributor is paid on their personal sales rather than building an organization of sale people, or a "downline".
It's also important to keep in mind that most direct sales companies offer products that are durable rather then consumable, there usually is a limited potential for residual income. There may be some exceptions, and I am sure that they are out there. But, for the most part, direct sales companies are looking for people that are attracted to the retail sales and not so much to folks that are looking to build an organization and earn a lot of residual income. Again, because of this fact, distributors working with a direct sales company will earn a income for products sold to a one time customer. They then move on to the next customer and potential sale. Immediate commission checks are usually higher than in network marketing, so if you are a sista looking for that quick cash...consider direct sales.

Now, let's move on to network marketing. I was attracted to network marketing because I wanted to build a long-term residual income. This is the biggest draw to companies that offer more of a network marketing pay plan. Network marketing distributors still sell to individuals direct, but the focus is on not only retail sales, but building an organization, or what we call, a "downline". The immediate retail commissions are usually lower than direct sales retail commissions, but your income can be substantial and grow rapidly if you are willing to build an organization or "team" of distributors. Your team will not only sell the product to customers, but use the product themselves, making them your customers as well. Hopefully your product is a good, consumable and high quality one, if so,  you and your team will probably have lifetime customers that will buy from you regularly. It is this ongoing customer use that creates residual "lifetime" income. The lifetime customers can come from your retail customers and also the distributors in your organization or "downline". Residual income is money you earn from your initial customer sales and reorders, and the customer sales and reorders of your team, so on and so on. This process continues to generate income for you long after the sale or sponsoring efforts were made. This is one of the main reasons the best network marketing companies offer consumable products like vitamins, personal care, cosmetics, etc....people will reorder when they run out! You will get paid over and over again.

Here are a few more benefits to network marketing, residual income being one of them:

  • Low start up cost. Usually the cost to get a welcome kit and sign up is pretty low. Customers order are shipped directly to them from the company. Therefore, the new consultant will only need to purchase the products he or she will use, demo and share with others. Most companies put together a new consultant product kit sold at an excellent value. No real inventory is necessary. Customers can usually reorder on the company or consultants website assuring the consultant will always get the credit.


  • More people will join because of the facts mentioned above.
         
  • There's potential for exponential growth. Consultants are able to leverage their time, energy and efforts through a small number of people that they train, who turn around and train their team, etc. With exponential growth you are able to build great wealth over time, and have the time to enjoy it!
Overall, it's up to the consultant or distributor to decide which program works best for them. It's really a matter of what you are looking for now and longterm. Whichever program one chooses, direct sales and network marketing is here to stay and fastly becoming THE profession of choice!!!  

Now you know the difference"-)

See you at the TOP!!!  British