Direct Sales Business Model

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Direct Sales Business Model A direct sales business model involves the marketing and selling of a product or service directly to the end consumers in a face-to-face manner instead of using distribution or having products sold in retail outlets (eHow2013). For instant, the fishermen sell the fishes to the consumers directly. Usually the direct sales is carried out in a home or workplace or away from a fixed retail location (DSAA 2013). The direct sales involves single level and multi-level compensation plan. Single level compensation plan is a structure in which a direct seller is compensated solely on his individual product sales sells the product or service of the company to other consumers with receiving bonus from the company according to his sale performance. On the other hand, a company uses multi-level compensation plan to structure the sellers. As sales team brings on new team members, the recruiter would be paid for the recruitment and a percentage of the product or service sold by the team. This structure continues on several levels under the original recruiter and the levels can go deep up to 8 levels (Direct Sales Aid 2013). Direct sales business model’s key advantages are worthwhile to be determined. Direct sales provides opportunity to small business to build and manage its own personal relationships with its customers, leading to better understand and adapt to the needs of their customers. Apart from these, business using direct sales model has ability to control over its pricing and distribution to verify its products are competitively priced (Petryni 2013). References eHow 2013, How to use the direct salesss business model, eHow, . Direct Selling Association of Australia 2013, Frequently asked question, DSAA, viewed 29 September 2013, . Direct Sales Aid 2013, Multi-level marketing, Direct Salesss Aid, viewed 29

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