Top Reasons Direct Sales Consultants Fail (Part 1)

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We recently covered some of the main reasons women sign up to run their own direct sales business. Today we’ll discuss the main reasons why those people in direct sales end up leaving their business.

There’s a widely-spread statistic that says 95% of people who start a direct sales business fail. That’s pretty staggering. 19 out of 20 people who start in direct sales end up quitting. Wow. I’ve also read that the average consultant sticks with a company less than 2 years. Those are pretty sobering, depressing claims. So, why is it that way? I’m not entirely convinced these statistics are true. But if it is, how can we avoid this outcome?

Top Reasons Direct Sales Consultants Fail

1. Lack of Support

2. Lack of Knowledge

3. Running the Business Like a Hobby

4. Bad Product Fit

5. Bad Business Model Fit

6. Life Happens

By no means is this an exhaustive list, but it covers the majority of cases. Let’s take some time and briefly discuss each of these.

Fork in the path

There’s a fork in the path… which direction leads to direct sales success and which leads to failure?

Lack of Support

Starting off with your own business, like any new endeavor, requires more than just a great idea. You’re going to need help and support. You can be the most motivated person in the world, with great ideas and tons of energy. But if you don’t direct all of that energy in the right direction, you’ll just fail faster (and harder). Direct sales is a relational business. That means it’s built on relationships. Not just relationships with customers, but also with a team. I’ve talked about how important it is for the Direct Sales Husband to be supportive of his wife. But it’s equally important for a new businesswoman to have the support of a leader in her company.

If you are considering signing with a direct sales company, consider who you will be signing up under. Often people will just go online and sign up. You may get a random person as your leader. This could be good or it could be bad, depending on who you get. Sign up for a party instead and get to know your hostess. See if she is interested in leading or if she has a recommendation of someone who is a good leader already. The more supportive your leader, the more successful your business is likely to be. Good leaders will teach you how to run your business and keep you engaged through those times you’re considering quitting.

When a consultant has that “quitting feeling,” if they don’t have enough support in the business and at home, they’re gone.

Lack of Knowledge

This is especially true for first timers or with new companies. Not knowing how to sell in the direct sales business, you may not even have a clue how to start. Most established companies will have resources available to consultants to teach them the business. They’ll have quick-start programs and incentives.

Avail yourself of all the resources you can get your hands on. Read up on the company’s website. Connect with other consultants and leaders in the company. Ask questions. Don’t run your business in the dark. There are tons of resources out there from books to personal coaching. Ask your leader where you should start.

Running the Business Like a Hobby

Don’t kid yourself. Direct sales IS a business. And the more you treat it like that, the more likely you are to be successful. A hobby is something you do for fun. You do it when you have free time or when you’re thinking about it. There’s something haphazard about that. Running a direct sales business like that will almost always end in failure.

Instead, develop a plan. A business plan. Write down goals. Think about what you want to achieve and why you want to achieve it. Stick to your plan, but modify it when you find a better way to work the business. Be intentional about it. Run your business, don’t let it run you.

Also, with your hobby, you don’t keep records or business books. This is absolutely essential to do with Direct Sales. Keep track of your income, expenses, mileage, incentives. Treat it like a real business, because that’s what it is. Start from the beginning to develop the healthy habit. Don’t risk losing your business due to tax problems or losing money

Check out this video on YouTube – Do Most People Fail In Direct Sales?

Look for the next part covering numbers 4-6 coming soon.

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