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Planning For Success

by Joy Healey

So! You’ve finally admitted to yourself – and the world at large – that the only way to make some extra money is to sell real-world products to real-life customers. How are you going to find the customers?

Well, your first customers should be yourself and close family - if you don't like and use the products yourself, how can you offer them to others? But you won't make an extra income with just yourself as your own customer. Sooner or later you're going to have to bring in money from someone else's pocket!

You could search for customers one-by-one, show them your products and hope to make a sale. Assuming you have a good, in-demand product this method works, but it can take a long time to build a successful business. Rather than trying to find customers one by one, the smart way is to get together a group of people with a common interest, present your products to them just once and take orders at the end of your presentation.

Suppose you find just four people, you have the chance to make four times the sales for doing the work once! But to further ease your task, why not just find one person (call him/her H) and give H an incentive to find four people for you? Then, suppose you asked those four to each find four more to hear about your products - in return for some incentive on the products they want - you'd have twenty potential customers from finding just that one original contact H.

The above figures assume you're a fairly timid person who wouldn't feel confident talking to a large group of people. As your confidence grows, it's recommended that H, your host, invites at least twenty people on the assumption that 15 will turn up to the event.

If you think that sounds a little like 'party-plan' you're dead right. However, don't stop reading - a rose by any other name will smell as sweet. Call it what you like, but it's a tried and tested formula that works extremely well - which is why it has stood the test of time and emerged over and over again, in various guises, as a method of moving goods. Those who do it properly can regularly earn good commissions for very little effort.

Some say it puts pressure on guests, but - they don't have to attend and so long as you have some low cost items in your product range it can actually mean they're under less pressure than in a one-to-one presentation. Make sure you include products which would be acceptable as a gift and you can remind people to do some advance birthday or Christmas shopping, even if they don't want anything for themselves. In fact if you put it correctly they can feel that you're doing them a favour by helping them to do all their Christmas shopping at one event.

A few of the categories of goods moved by this method are: books, wine, make-up, craft-work, perfume, cook-ware, health products, Tupperware (probably the most famous) and clothes - designer or quality seconds. Ideally the product being marketed should reflect the current ethos and age-group of target audience - a fur-coat evening might not go down too well these days in most circles, whereas people are more and more aware of their own and their family's health and education. Particularly the 'baby-boomers' who are becoming aware of their own mortality.

When choosing a company, as well as satisfying yourself that there's a demand for the product, be sure to choose something you have an interest in. If you hate domesticity, Tupperware might not be the best choice for you, however good the business. Ideally look for a product with a repeat sale element - health supplements, perfume and make-up are good examples. Perhaps aim for two bites of the cherry with health supplements AND make-up.

Consider what the company will do to help you get going as a distributor. For instance do they offer free training, or at the very least a good and reasonably priced video to explain the business in detail? There should be a start-up package - heavily subsidised - of everything you need to get underway.

To minimise your start-up costs, choose a product where customers can order from a catalogue so that you don't need to carry a large stock. How expensive is it for your customers to open an account (or become distributors themselves) and buy at wholesale? You should look for a company which makes it easy for customers to place repeat orders without involving you in extra work, while still rewarding you for having introduced them in the first place. This way you'll build up a large base of repeat customers with an incentive to spread the word about your (and now their) products. Burger King succeeds not from one large restaurant, but from sales through many smaller outlets. But be careful - if it costs money to open an account, many people won't want to make the outlay as it's very unusual to be asked to pay money to become a customer!

More on start-up costs: do you need to carry samples? For instance with books it’s a good idea to have one title from each series, and at a make-up party you'll need a wide variety of shades of lipstick, foundation and eye make-up. Be wary of designer clothes - customers will expect to try on items before buying - implying the need to carry a full range of sizes and styles. Fashions change rapidly, so what happens to last season's range and who finances purchase of new lines? If your products are consumable you can make a virtue out of NOT holding stock as obviously you'll want to order fresh from head-office. In these circumstances, make up a display from empties - which has the advantage of avoiding problems of pilferage. Incidentally, look for a company where you can order direct from head-office, rather than going through a chain of distributors as the latter can cause delays and may mean you're supplied with less than perfect stock which an up-line distributor has been holding.

Are you free to set your own price? Can your customers pay by credit card? If not, you may lose sales or at best sell a much smaller quantity. People really do expect to 'whack the plastic' these days. It also protects you from the cost and embarrassment of bouncing cheques. Look for a company which will let YOU place orders on your credit card so that in most cases you don't have to finance sales until you've been paid yourself.

Parties aren't the only way to harness this selling method. The format and timing of the event can vary according to your target market. With children's books an early afternoon session, while the children are at school, may be more convenient. For health products you could give informative talks instead of or as well as more informal 'party' get-togethers. Go for groups which meet regularly as they're always on the look-out for a new speaker - Rotary clubs, WI, complementary health practitioner associations, church social groups, mother and baby groups etc. You needn't even give presentations - find hairdressers, gyms or PTAs to promote your products. Look for anyone who might want an extra income - perhaps the receptionist in a large office.

Your host(ess) will probably expect some kind of incentive to hold the event. At a make-up party the hostess may receive a free facial and make-over. Where goods are for sale these may be either at a specially reduced price or even free. How much will this cost you? Are there facilities to buy it at a special rate? Consider this as part of your marketing cost. If possible, tie it in to the value of sales made or number of new events booked. Giving a hostess gift also puts your hostess under a slight obligation to help out and 'earn' the gift - by arranging for guests to collect goods and possibly payments, rather than you having to arrange each delivery separately, which would increase your costs and time spent.

You will need to decide whether to collect money on the day of the event or on delivery. There are pros and cons to either method. Obviously if you hold stock and someone wants to take it away, you should expect payment there and then. If cash is tight and you need to pay for your goods up-front you'll prefer to ask for money on the night. This has the advantage of getting a firm commitment from a customer. But if you're taking orders for delivery later, guests may be reluctant to part with money to a complete stranger and go away empty-handed. This is where the hostess can bridge the gap and be responsible for collecting the money from guests.

It's best to arrange a short meeting before-hand with your hostess at the venue of the event. Use this to check that the layout of the room is suitable; you won't be as nervous about going into a 'new' place and you can be sure you know the way! This is also a good time to leave a few spare catalogues for any-one who can't attend on the day. You might then have the pleasant experience of arriving for your event and finding you have orders before you start! You can also check that your host has any 'props' you need for your event e.g. a video player. Don't assume there is one - check first - you don't need unpleasant surprises with ten minutes to go.

Show the hostess the catalogue, explain what incentives you're offering and what she's expected to do in return. To make the event easy to duplicate for others who may consider becoming hostesses, suggest that food and drink is kept to a minimum. This also protects any stock from spills and finger marks. Arrange to delay refreshments until after your presentation - you want your group's full attention.

On the day, leave home in plenty of time to arrive at least 30 minutes early to get your display set up before the guests arrive. Beware of local events which might disrupt traffic - is the venue near the local football ground?!? Take an attractive table covering and as many sales aids or posters as you need to make an eye-catching display. Don’t use blu-tac or sellotape without permission - ideally have free-standing cork-boards for any posters.

Prepare a check-list of things to take. This will include catalogues and order forms, sales aids, your diary to book in future events (and make sure it doesn't look empty!) and pencils and paper for each guest to be able to note down products that interest them as you talk. Take brief details about the business in case anyone wants to become a distributor themselves. But if you're attempting to recruit new people, don't be tempted to try and do it on the night - give them a brochure and arrange a separate appointment.

If you're taking payments on the day you'll need a 'float' of change. Look at your price points – if you sell goods at £9.99 have plenty of pennies and so on. Don’t neglect the larger denomination notes either – you’ll be pretty fed up if the first customer wants you to change his £20 note and you lose the sale because you can’t. If people pay by cheque, copy their cheque card details onto the back of the cheque and watch the card limit. Finally on the subject of money, keep it in a money-belt or ‘bum-bag’ and don’t let it out of your sight for a second!

Keep your sales pitch at the event short and simple. Start off by welcoming guests and thanking your hostess. The best companies provide a standard company flip-chart with a presenter to help you structure the talk. If you're asked a question you can't answer, don't panic, just say that you'll look into that privately later. Involve the audience - if you're selling health supplement products ask if anyone has experienced beneficial effects.

Third-party testimonials about the type of products you're selling carry more weight than anything you'll ever say. Emphasise the quality and reliability of your company and products. Stress your own personal service and commitment to their satisfaction. If retail customers are eligible for a money back guarantee, tell them! Few take it up, but it promotes security and can just swing a sale when the customer is hesitant.

At the end of the event, there are four things to remember: (1) Ask: 'Does anyone need help completing their order form' - assume the sale is made. (2) After they've placed their orders, describe the incentive for anyone who'll book their own event and try to book some. (3) Invite anyone your guests knows who'd be interested in becoming a distributor to get in touch with you later - particularly your hostess. If any of her guests want to become distributors or open their own accounts she could 'introduce' them and may then earn commission on any future purchases or sales they make. Your aim is to build a team of wholesale customers and/or distributors on whose purchases you earn a small commission, for training and supporting them in their new venture. (4) Make sure people know how they can purchase further products - when they've had the benefit of the current ones, or have remembered friends and family who need what you're offering. Attach sticky labels to all your order forms, catalogues and any goods you supply. It's much easier - not to mention cheaper - to sell an extra (or new) product to an existing customer than to find a new one.

Allow plenty of time for taking orders and helping customers with personal questions at the end of the event. Watch for anyone who'd like to buy products but can’t afford them - they're potential hostesses or even distributors (and they've just had their first training, watching you do the event!)

Treat your talk as an enjoyable event and you won’t go far wrong. Repeat the formula, train others to do the same and you’ll make a good profit. Happy selling!

Issue 1, Friday 3rd March 2000

 

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or for an information pack and audio tape send 4 first class stamps to:
Joy Healey (NSP/DL), 34 Kynaston Wood, Harrow, HA3 6UA, UK

 

 

 

 

 

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