What is a Vector Anyway?

1. What is a Vector Anyway? A Guide for Evaluating Career Opportunities withDirect-Selling Companies CPCC Career Services, 2005

2. What is Direct-Selling? Direct-selling involves person-to-person sales of products and/or services. Sales transactions are not performed in a retail store. Direct-sales professionals are often called consultants, independent contractors, distributors, representatives, and other titles. Products and services sold through direct-selling are often presented to consumers through in-home demonstrations, parties, and other forms of one-on-one selling. CPCC Career Services, 2005

3. How do Direct-Sellers Differ from Other Salespeople? Direct-sellers are independent contractors. They are entrepreneurs who operate their own business. Retail salespeople are typically on the hourly payroll of a retail store/company (example: sales associates at GAP in the local mall are retail salespersons). Some retail salespeople make commission on their sales. Manufacturer/wholesaler sales representatives are typically on the regular payroll of the manufacturers they represent in business-to-business sales transactions. (example: a salesperson for the denim manufacturer that sells jeans to GAP, who then sells the jeans to the consumer). CPCC Career Services, 2005

4. How can I tell if a Job Posting is a Direct-Sales Opportunity? It can sometimes be difficult to tell at first glance. What you learn about the opportunity may depend on whether you are approached by a person who works for the direct-selling company or whether you see a poster or online job posting. The best direct-selling companies will make it clear immediately that you will be working as an independent contractor who will own a small business. continued… CPCC Career Services, 2005

5. How can I tell if a Job Posting is a Direct-Sales Opportunity? …continued Direct-selling companies often entice recruits by playing up the benefits typically associated with owning a business: • Flexible schedules • Freedom to conduct work in a way that suits you • Way to meet new people • Opportunity to earn extra income The benefits may be featured, but the company may not reveal that participants will own a business. Individuals should thoroughly check the company’s website to see exactly what type of opportunity is being offered. CPCC Career Services, 2005

6. Mary Kay Longaberger Baskets PartyLite Shaklee Vector/Cutco Tupperware Avon The Pampered Chef Primerica Some Popular Direct-Selling Companies CPCC Career Services, 2005

7. Aren’t Direct-Selling Opportunities Scams? In general, direct-selling opportunities that use single and multi-level compensation plans are legitimate. Scams do exist; and it is up to the job-seeker to research the company and opportunity in order to protect themselves. Legitimate direct-selling opportunities can provide a great source of extra income for some people; some individuals make their entire living off of legitimate direct-selling work. CPCC Career Services, 2005

8. Direct-Sales orPyramid Scheme? Some opportunities are not what they seem. As with any offer that promises income, one should conduct thorough research. Before researching a specific opportunity, learn to distinguish legitimate opportunities from “pyramid schemes.” Pyramid schemesare illegal. The schemes are built solely on signing-up other individuals to invest in the opportunity to recruit more individuals to do the same. The individual who recruits the new person gets a cut of the “investment.” The money moves up the chain, resulting in only a few or one person getting rich. The losers in this scheme are those at the bottom of the chain who fail to recruit new people to invest. Lack of general knowledge, the existence of illegal scams, and a history of poorly-operated direct-sales companies can cause public confusion. More information on schemes. CPCC Career Services, 2005

9. What to Look for when Evaluating Opportunities • Find out whether consumers will be the ones buying the products or services you will sell through the company. If the opportunity requires selling to anyone other than consumers, be wary. • Ask if the company will buy back unsold inventory. Legitimatecompanies will buy back at least 90% of the unsold inventory you purchased. • Start-up investments for legitimate companies should be relatively inexpensive. If fees are very high, then you should probably avoid joining. “Get rich quick” claims and high pressure to spend a lot of money in the beginning can be reliable warnings. • Do you have to search long and hard for information? Legitimate opportunities will give transparent, easy-to-find, easy-to-understand information on their website. The 1-800 number should not be the only source to get information about the opportunity. • Ask yourself if YOU would buy the product or service in question. If you would not buy it; you probably should not try to sell it. • Source: www.dsa.org FAQ Page CPCC Career Services, 2005

10. Research In addition to reading everything on each company’s website, here are some other resources that will help you decide whether to pursue a direct-sales opportunity. The Direct Selling Association (DSA) is a national trade association that represents direct-selling companies. The DSA has a code of ethics to which it reportedly requires all members to adhere. Consumers and potential direct-sellers can use the DSA to learn about companies and check for legitimacy. Some may benefit by joining only those companies listed as DSA Members. Explore their website: www.dsa.org. Pay special attention to the Code of Ethics and the Membership Directory continued… CPCC Career Services, 2005

11. Research The Better Business Bureau (BBB): www.bbb.com The way a business treats its customers can give clues to how you will be treated as a sales representative. Also a good way to check up on the local end of a national direct-selling company. The Small Business Administration (SBA): www.sbaonline.sba.govGovernment agency provides tips, support, and resources for those interested in starting a small business and those who already run one. Best used for general information on what it takes to be a successful entrepreneur. Contains little information on direct-selling. CPCC Career Services, 2005

12. Local Issues Just because a legitimate, national, direct-selling company is an award-winning member of the DSAand has a great BBB record does not mean sales directors/recruiters at the local level will be perfect. While you research the whole company, try to findout information about representatives with whomyou will interact. Talking to current and formerdirect-sellers associated with the company you are considering is a great way to learn what you needto know in order to decide with confidence. An example of a local issue: The company’s policy may indicate that you can quit at any time; but the local director may resort to high-pressure tactics toget you to stay with the company. CPCC Career Services, 2005

13. Additional Notes about Direct-Sales Companies Even some of the best direct-sales companies can become the target of disgruntled former representatives and annoyed consumers. After failing to succeed as a direct-seller, some will blame the company, whether the company was the cause for failure or not. CPCC Career Services, 2005

14. Next Step Imagine… You have been asked to become an independent contractor for a direct-sales company. You did your homework and verified the legitimacy of the offering. It is not enough to simply ensure a direct-sales opportunity is legal. You must make sure direct-selling and entrepreneurship fits your personal goals, style, and interests. CPCC Career Services, 2005

15. Is Direct-Selling for You? For many, the chance to own a business is a dream-come-true. Having a flexible schedule, being released from limits on earning potential, injecting excitement into life, and getting to be the boss are seductive benefits of being an entrepreneur. All who consider starting any business must be aware of the realities that come with being an entrepreneur: • accounting and taxes • irregular income flow • responsibility for ultimate success/failure • selling and marketing consistently • risky nature of small business ownership • long hours CPCC Career Services, 2005

16. Is Direct-Selling for You? The direct-selling recruiter who wants you to join his or her company will probably do little to confirm that you are a good candidate for owning a small business. It is your responsibility to figure that out before spending time and money on a direct-sales opportunity. • Receive career counseling to see what occupations best fit your personality and interests • Take advantage of college institutes that teach the process of starting and running a business. Some offer entrepreneurship assessments and counseling. Try CPCC’s Institute for Entrepreneurship • Take a small business course at CPCC • Chambers of Commerce typically offer entrepreneurship resources and information CPCC Career Services, 2005

17. The Sales Industry and thePeople who Thrive in it. Extremely successful salespeople are successful for a reason. They are expert persuaders who value competition, excitement, recognition, profit-gain, and other forms of business success. Salespeople may appear “pushy” to those who aren’t familiar with sales or to those who do not hold enterprising values. No matter what direct-selling opportunity you pursue, remember that you are always selling something.Be sure that is what you want to do before startingyour own business. Successful selling requires Persistence Persuasion Promotion Positive-thinking Passion CPCC Career Services, 2005

18. Still Not Sure if Direct-Sellingis for You? • Instead of spending $150+ on a product kit for direct-selling, try taking a job as a commission-based salesperson. If you enjoy selling things to people and earning money based on sales performance, then maybe you would benefit from a direct-selling opportunity. To learn more about direct-sellingand small business ownership,contact Career Services. Visit our website: www.cpcc.edu/career career.services@cpcc.edu CPCC Career Services, 2005