Direct Sales Distributor

When to offer customers a discount.

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Direct Sales Distributor - Avoid Perpetual Discounting

offering product discounts
As a direct sales distributor, sometimes it can be very tempting to perpetually discount your products.

If you are involved in home based direct sales or home party sales careers, it is important to understand this key tip: avoid perpetual discounting.

I cannot tell you the number of times I have seen those involved in home party sales careers offering perpetual discounts online.

What are perpetual discounts?

This is where a direct sales distributor, in an attempt to generate home based direct sales, discounts the prices on her products to the point where she is making little to no money.

For example, the direct sales distributor may offer customers 20% off (while her commission is a mere 25%) on a continual basis.

I've even seen stay at home mom businesses offering the entire 25% off as a perpetual discount to online customers!

Reasons to Avoid Perpetual Discounts

Why should a direct sales distributor, involved in home based direct sales avoid giving perpetual discounts? For many reasons.

The Direct Sales Distributor Makes No Money
If you are involved in home party sales careers, you are here to make money! When a direct sales distributor gives away most or all of their commission, they are robbing themselves of their pay. You cannot be successful in stay at home mom businesses without receiving compensation of some sort.

The Product is Too Expensive
When a product is perpetually discounted, customers will not want to buy it at it's regular price, as they have been programed that that price is too expensive. It's not. If you are part of a successful home party sales company, then the prices of your items are reasonable. Discounting them continuously changes the perception of the customer, and they will feel everything costs too much, unless you have it on sale.

The Discount is Taken for Granted
When those involved in home based direct sales offer discounts often, they are taken for granted. A customer will not buy a product unless it is discounted, and will simply wait the consultant out until she offers it again at a heavily discounted rate. Again, the direct sales distributor makes no money.

Trouble Recruiting
If someone is constantly offering her full commission as a discount on an item, or an entire line of items, then there is no extra incentive for a customer to turn into a recruit. Especially when the potential recruit finds out that if they too offer such a discount, they will make no money!

It Hurts the Entire Industry
When a few rouge distributors start offering these types of discounts on a regular basis, the entire industry suffers. If you combine all the above points, customers suddenly start to feel as though the products are too expensive, and only buy from those that offer their commission as a discount. No one makes any money, and business is bad across the board.

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When Discounts are OK

A distributor occasionally offering a discount is OK, especially in an offline setting. Once in a while, things happen and a distributor may be just shy of a sales goal and might use a product discount as a way to generate fast sales. Or perhaps they are offering an incentive to those attending their online home party.

Just remember, offering a discount too often will kill your business. And you are in business to make money, right? There is nothing wrong with charging full price for your items. This is what is intended. Other options for customers instead of offering discounts:
  • Offer free or discounted shipping
  • Offer raffle entries for free product
  • Offer product samples with purchase
  • Offer a small discount (like 10% off) when customer brings in an outside order
  • Offer incentives to host a party
  • Bottom line: resist the urge to offer heavy discounting. It will help you, and the entire industry, in the long run.

    Do you offer product discounts? What do you do?

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