Direct Sales Industry Facts and Statistics

The Direct Sales business model has been around for decades but today is far from "Just Your Mom's Party Plan Business". While thoughts of the industry might evoke ideas like door-to-door selling of the 1950's and 60's or Moms trying to make extra money at home parties, this is hardly true of today's Direct Sales industry.

Once an industry made up of women, mostly young mothers in years past, today's demographic shows us that the industry appeals to both genders from all walks and ages in life. Why is that?

Today, the industry attracts professionals looking to establish a work-life balance that Corporate America can not offer them.

Today, 1 in 4 fathers are the primary caretakers of their children, espeically in recent years because the largest job loss in America has been in the male dominated sectors.

Today, Baby Boomers are retiring and realizing the need to supplement a pension or Social Security income. Let's face it: Social Security doesn't go far with today's cost of living.

Today, Generation Y entrepreneurs are emerging with an incredible capatcity to harness the power of the internet. As such, most Direct Sales companies have an interent presence in today's modern e-commerce age.

The 2009 prove all those statements and more as you break them down.

An estimated $28.33 billion in product was sold by the direct selling industry. That's an impressive figure given the economy during 2009.

It is estimated that 16.1 million worked in the industry in 2009. This is up a full percentage from the 2008 figure of 15.1 million.

Sales in product groups were also tracked. The breakdown is as follows:

23.9% was home goods, family care and home durable products.
22.8% was wellness products.
21.3% were classed as personal care which includes jewelry, makeup and skin care products.
18.4% was caegorized as other services.
10.3% was clothing and accessories .
3.3% were classed as leisure items, like books, toys, videos etc..

The predominant way of selling was still person-to-person or face-to-face selling at 78.1% of the total sales. While home parties are one faction of that total, many direct sellers now use other methods like catalog sales, open houses, craft shows and bazaars, festivals and more. The remainder of the sales (12.1%) were listed as Remote Selling which includes internet sales, telephone orders and shipment to customers or direct sellers who have that type of program.

When you look at what direct sellers said their methods of selling were in 2009, party plan and group selling only accounted for 25.4% of the total volume nationally. Individual and person-to-person selling led the way with 64.3% however no further breakdown as to the exact method was reflected. The remaining 10.3% was accounted for as auto-shipment to distributors and product shipped directly to the customer.

These facts and statistics confirm that Direct Sales has kept pace with the modern internet age and is far from the industry of years ago.

Based on what we see in the industry today, I would have to say yes! Residual Income and opportunity for promotion and advancement may very well be what evolved the industry from one made up from predominantly part-time Moms to today's which attracts professionals and people from 18-80.

Each company has their own compensation plan. I would strongly suggest to anyone looking at an opportunity to really digest it and get clarification on what it really means for you. What appeals to some may not to others and I am not here to say one plan or model is better than the other. It's all in what you are looking for and what appeals to you.

Residual Income is derived from team building or introducing the opportunity to others. While each company's comp plan is different, the 2009 overall figures indicate that 94.2% of all companies in the industry offered a compensation plan that was multi-level in nature. This allows direct sellers to earn residual income, commissions and/or overrides on their sponsoring efforts by introducing others to the company and opportunity.

82.4% of direct sellers were female.

17.6% of the total direct sales force is made up of men.

Direct selling is an equal-opportunity employer regardless of gender and males can be just as successful as females.

A Direct Sales business can bridge the gap for many families struggling with unemployment, downsizing, in establishing a work-life balance between career and family and so much more. The industry offers many perks including flexibility and the freedom of being your own boss in your own business. This appeals to men as much as women.

Direct Sales is also a great consideration because the startup costs are relatively small, the income tax benefits can be great and it won't break the family bank to launch a business.

The age of the American direct sales force was measured in 2008 in a National Salesforce Survey.

21% were 18-34 years old
32% were 35-44 ( the largest percentage)
25% were 45-54
4% were 55-64
8% were over 65

Today, the industry is attracting retirees who are using direct selling as a way to supplement their pension and social security benefits.

Marital status according to the National Salesforce Survey in 2008 shows 77% of those engaged in direct selling as married. This confirms that direct sales are a viable alternative to employment outside the home, allowing a parent to earn additional income while balancing work and family.

Educational background was also tracked and the largest percentage of people in direct sales were college graduates at 32%, followed by those listing trade school or some college at 29%, high school graduates at 22% and 10% even completed the post graduate level. Only 6% of the total sales force indicated they did not graduate from high school or refused to answer that demographic question.

This supports the fact that direct selling is a legitimate business model that more college graduates are finding enticing. Many graduate from college only to find a lack of jobs in the current economy and that they are over-educated for positions available. Direct sales bridges the gap for them, giving them a way to create their own business without a lot of overhead or startup costs.

Direct sellers are only limited by how much they work, what they sell and how big of a team of distributors/consultants they can build under multi-level compensation plans.

The 2009 statistics on how direct sellers classify their position is interesting and backs up this statement. Direct sellers can earn a nice income per-hour and enjoy flexible schedules and work-life balance. 92.5% in the industry say they are part time or work part time hours. While certainly some have traditional jobs outside the home, many in direct sales are otherwise primary parent caretakers or stay at home. No further breakdown on this statistic was available. But it certainly indicates that many can make a nice per-hour pay without considering themselves as working full time or full time hours which only 7.5% stated they were.

It's easy to see why in today's employment and economic climtate, direct sales might be the answer for many in various stages of their lives. Today, it's an equal opportunity employer and entrepreneurs can embrace it and create a great part or full time business.