Concerned that devoting less time to personal sales and more to recruiting could hurt you financially?
The direct sales industry, for the most part, uses a two-tiered compensation plan. You can read more about it here; but essentially it means consultants get paid a commission on their personal sales and if they choose to build a team, they also get paid a leadership bonus on a portion of sales of all other consultants within their downline.
Recently I had a conversation with a direct sales team leader about compensation from personal sales vs. team sales. For maximum payout in direct sales, team building is a must. You must continue to build your own personal business by selling the products, and you must also share the business opportunity with others and continually sponsor new team members.
Optimal payout requires balance.
Personal sales pays a higher commission (up to 30% with Scentsy), and leadership bonuses range from 2-9%. At first blush you can see why one would rather have 30% than 2%. Not necessarily so, read a portion of my (LA) conversation with the team leader (TL).
TL: Of my whole paycheck, the portion of my personal sales is so much smaller than what I get from the other team members. That stinks.
LA: That’s good. It shows team building. You’re working smarter, not harder, and the importance of balancing personal sales and mentoring others. The portion of my check from my personal sales is also very small compared to the leadership bonus I get from the hundreds of others I’ve brought in over the years – either me personally or sponsorees of others within my downline.
TL: Ya but aren’t you bored just selling the minimum personal sales required? I want to be proud of what I’m bringing in too. [Read more…] about Direct Sales Compensation