Direct Selling also known as Multi Level Marketing or MLM for short is a direction that some start up businesses take to launch and get their product or service into the hands of the general public. The direct selling approach is completely different than the traditional way of getting a product into the hands of the consumer. Traditional businesses may hire sales people who earn a one-time commission for obtaining customers, but the real money is spent as they launch and sell their product through mainstream media: television, radio, print media (magazines, newspapers) etc. Companies that take the direct selling approach use commission based representatives to sell their product. The representatives usually pay a fee to register with the company then often times (for product based companies) they buy inventory and resell it to friends, family, co-workers or any other method they desire. When spoken about in this context it is often referred to as relationship marketing. The sales representative not only makes commission from the sale of the product but they also recruit others to join the organization and do the same thing they are doing, selling the product through relationships. The new recruit becomes a part of their down line. The recruiter also gets commission from the product sales that the new recruit brings in and often times gets a one time bonus for getting them to join. These representatives sell the product and recruit others to do the same thing as they attempt to build their down line to massive levels. Companies that take the direct sales approach often produce millionaires in their organization that spawn from a combination of the sales representatives individual efforts and their down lines efforts.

The direct sales approach works great for companies for two reasons: one, instead of spending money on traditional advertising they are able to instead reinvest that money into their sales associates through a high paying compensation plan and in turn produce sales reps that have superb product knowledge and a passion for the product. Two, the customers they obtain are more faithful. Think about it, who would you rather buy from time and time again, a store or a friend? The direct sales approach calls for a much different organizational structure where the main focus is not only the customer but the sales representatives that are selling and building their down line. Ongoing training and motivation is the key to maintain sales volumes. Training is often voluntary and comes at a less expensive price, usually through video, webinars and local seminars at little or no cost. The training is also given by top company producers for free but as a huge benefit to them as it gives them the opportunity to motivate and speak to a large majority of their down line associates at once thus causing a spike in their layered type pay structure.

It sounds great but the company that takes the direct sales approach needs to have a strong compensation plan, a solid product or service and a continuous method of motivating their representatives. Remember, their sales reps pay a fee to register with the company so they can back out at any time and most of these representatives work on an at home part-time basis. The Direct Selling Association has stringent rules in order for a company to be affiliated with them. Reputable companies with solid compensation plans and strong upper management are companies that belong to the Direct Selling Association.