As I have written for many years, a good compensation plan financially and ethically fits your business while motivating and rewarding very specific behaviors from your sales force. In all, there are 12 essential compensation plan behaviors. 12 Compensation Plan Behaviors These behaviors are… Personally purchasing your products or services. Selling to customers (non-participants of the…
Pruning Your Tree: When To Deactivate Your Reps
Terminations, deactivations, and reclassifications are all terms used to describe the process used by network marketing and party plan companies to end the businesses of their independent representatives due to insufficient activity. Having consulted with direct selling companies for 35 years, I have seen a wide variety of approaches used by direct selling companies to…
Must Direct Selling Companies Treat All Reps The Same?
By Kevin Grimes, J.D. The short answer is a very precise, lawyer-like,“yes and no”. The long answer depends upon the context of the question. If the question is about compensation plan issues, ranks, and the rights and privileges associated with each rank, the answer is “no”. In a direct selling model, the compensation for which…
Fast Start Programs: What You Need To Know
The success of all direct selling companies depends on the performance of their new independent representatives. What can companies do to help their reps get off to a good start? One of the answers is a Fast Start Program. While network marketing and party plan direct selling companies have much in common when it comes…
Our Videos On Leadership
Leaders are so important to the success of all direct selling companies. They sell more, recruit more, and stay active in the business longer than the average representative. Everyone wants more leaders, but how do you get them? There are two schools of thought regarding leadership. One says leaders are born, that is, they have innate…
When Should I Ask A Direct Selling Business Consultant For Help?
You have put a lot of time, money, and energy into your direct selling, network marketing, referral marketing, party plan, or social selling company. It’s your baby, but it’s not always easy to be a good parent of your company. You may be wondering when is it time to ask a direct selling business consultant…
How Do You Calculate Landed Cost?
For a direct selling business to be profitable, it must have healthy gross margins. While margins can be calculated in several ways, at Sylvina Consulting we like to use what we call the “multiplier.” The multiplier is a ratio calculated as the suggested retail price of an item divided by the landed cost of the…
Should You Have A Hero Product?
A hero product is a product that is responsible for a large percentage of a company’s transactions or sales. A prospective client asked me recently: “Should we have a hero product?” My first answer was, “Yes, you should.” But then, I thought about it some more and changed my answer to, “Maybe.” You see, having…
Compensation Plans: Structure Matters
In compensation plans, there are positions of achievement we call titles or ranks. To qualify for them, independent representatives meet volume and structure requirements. Both are measurements of organizational performance. A volume requirement is a measurement of volume from (a) an individual independent representative, (b) a group of independent representatives within one’s downline, or (b)…
How Much Is A Distributorship Worth?
A business is an asset with a revenue stream which can be purchased or sold. Businesses can be valued in a number of ways. One way to value a business is to use SDE (seller’s discretionary earnings). SDE includes the net profit of the business plus any personal income, discretionary income, one-time expenses, and owner…
5 Ways To Get More Customers
There was a time when network marketing companies sold most of their products to their independent representatives for their personal use, and this was not a problem. Back then, companies didn’t worry about having customers who were not representatives. Network marketing companies focused 99% of their attention on selling products or services to their representatives. …
The Best New Year’s Resolutions
As each new year approaches, there is societal pressure to make one or more New Year’s resolutions. Perhaps you have felt it, or maybe someone has asked you what yours are. As direct selling, referral marketing, and compensation plan consultants, we feel the pressure to make resolutions, too. Most Popular New Year’s Resolutions According to…