Thoughtful Recruiting For Your Stamp Or Scrap Biz
Posted on December 16, 2007 - Filed Under Business
You just signed up for a scrapbooking or stamping direct sales company. You now start on the recruiting “train”. It’s not required, but it seems to be the “thing to do”. You hold workshops or parties and all through the workshop, you “sell” the idea of joining your company with the idea that if you can get people to sign up, you’ll be home-free - making money on THEIR sales - WooHoo! Sounds like a good plan, doesn’t it? Well, maybe not. Nothing can potentially kill a good business faster than recruiting. Huh? I’ll say it again, nothing can potentially kill a good business faster than recruiting.
Let me show you how:
You sign upYou sell $200 a month to Customer AYou make $50 a month from the sales you make to Customer A.Through your effective recruiting efforts, Customer A signs up to be a consultant but is really only in it to get the discountCustomer A still buys $200 a month on average of products - only now, she buys them from the Multi-level company herself Customer A enjoys her 25% discount off of the products she sells to herself. You now make 3% off of her sales as her “upline”You now make $6 a month off of customer AYou lose $44 a month in revenue…End of story.
Keep in mind that the company doesn’t lose anything. They gain another one of you who will “lather, rinse and repeat”. Pretty soon, everyone is buying directly from the company and there are no “customers” left. Not to mention that now the company can sing the praises of the fact that they have X number of consultants, when in fact, a large percentage of those “consultants” are just the former customers of another consultant who was too good at recruiting. This scenario is even WORSE if there is no downline and you get a one-time credit or perk for recruiting. Then you lose a customer forever for a mere fifteen bucks or whatever it is. Building a business is all about creating revenue streams that keep flowing. If you are putting a dam on the stream, pretty soon, the stream will be dry.
Can you recruit legitimate business owners who are interested in building a real business? Of course, you can. But, be careful when you blanketly throw out the “opportunity” at a workshop or party. What if everyone in the room signed up? You would have to find new customers every time you held an event. And, then, whether they are selling or not, you have to devote time to managing your new-found recruits. That takes time away from doing what you love - teaching your craft and selling your products.
So, recruit carefully and thoughtfully. Signing up everyone to be a “hobbyist” who gets a discount is not a smart way to build your business.
Kim Guymon is the founder of ScrapBiz and is considered one of the foremost experts on starting and running a business in the Scrapbook Industry. Since 2001, she has helped hundreds of entrepreneurial scrappers realize their dream of owning a scrapbook business. She has also introduced the wholesale side of the industry to the idea of non-traditional retailers.
Kim can be contacted at Kim@ScrapBiz.com or you can view her website at http://www.ScrapBiz.com or her business blog at http://www.KimGuymon.com
Tags: direct sales company, downline, even worse, fact that they, fifteen bucks, good business, lather, level company, praises, recruiting efforts, revenue streams, scrapbooking, she sells, time credit, upline, woohoo
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