Corporates are not the only option for job creation in a declining economy
The corporate job market is slowing and South Africans are increasingly going to have to find alternatives to working for a big company to earn an income.
Internationally, changing working practices, the use of specialist consultants or project-based workers, the rapid growth of technology, speed-to-market and the need to be lean and nimble are all changing traditional corporate culture.
Domestically, issues such as political uncertainty and the recent economic downgrades will further discourage already cautious corporates from investing in the South African economy, limiting corporate growth and jobs.
It’s an environment in which direct selling is becoming an increasingly popular way for people to supplement or earn an income.
Ernest du Toit, chairman of the Direct Selling Association of South Africa, says that health and beauty companies were amongst the first to effectively outsource their sales departments to self-employed agents, but that the practice is now expanding to other sectors.
“The number of people involved in direct sales grew by 5.5% from 2015 to 2016 to 1.1 million and sales increased by 13% to R10.93 billion. We anticipate this growth to increase exponentially as more people look for opportunities and more companies seek better and more efficient ways to sell.”
He says that given global trends and a constrained domestic economy providing fewer full-time jobs, direct selling is becoming even more appealing as companies offer free training and support, making it relatively simple and risk-free compared to other entrepreneurial ventures.
“It’s been said that South Africa’s high unemployment rate may be more a consequence of a lack of skills than a lack of opportunity. Direct selling is a sector that’s bridging that gap.”
While the prospect of being a self-employed entrepreneur or earning additional money each month is tempting, there are some guidelines to consider.
Be honest with yourself
Although it seems self-evident, remember direct sales involves selling. Before you get too enthused about flexible working hours and the prospect of more money consider how comfortable you are about asking family, friends, acquaintances or strangers to purchase products or to host a group of prospective customers? Although the rewards can be considerable, not everyone is cut out for a career in sales.
Go with what you know
Be guided by your knowledge, interests or passion. You’re much more likely to make sales if you’re working in a market you know, have some interest in the products or are enthusiastic about the sector. It stands to reason that if you’re an avid home cook you’d be better off selling kitchenware than running shoes.
Selling a product that aligns with your pursuits or lifestyle also means you’re likely to have networks of people with similar interests. This will give you an advantage when you get started and also a foundation upon which to expand your networks. Knowledge of a sector allows you to share your insights and observations on social media and build new networks.
Do your homework
If you’re a keen runner, have a good network of running buddies and find a company looking for agents to sell running gear it may seem like a match made in heaven. A good place to start is with the products that made a difference in your own life. If a product helped you lose 10kgs then it is easy to talk to others who have the same need. Similarly if your acne skin has been healed, it is easy to talk with passion to others who are experiencing skin problems. But, before you sign up, check if the company is listed on the Direct Selling Association website. You can search by company or by category. The good news is that if it is, it must abide by the Association’s Code of Conduct and ethics. This offers you protection and recourse.
Once you’ve established the company’s credentials ask about the support and training it offers. Is there an induction programme? Will you be offered marketing material to try or give to your first few customers? How often are there sales meetings and briefings on new products and sales techniques?
Ask about any costs. Do you have to purchase a starter pack or carry a minimum amount of inventory?
You may be enthused about embarking on your dream job, working in a sector that interests you and being your own boss, but as with most other careers, success doesn’t come overnight.
It will take time to build a customer base and you’ll need to invest time and effort in order to generate the returns you want. Also remember there is behind the scenes work such as placing product orders, doing paperwork and attending training sessions in order to improve and grow your business.
“Set yourself reasonable goals and targets. Initially start short-term, a quarter, six months, a year. As you progress you may evolve to a five-year plan. If you can, find a mentor who has some experience in the field and test your goals and assumptions with them,” advises Du Toit.
“Direct sales isn’t a shortcut to success. It requires the same degree of drive, professionalism, commitment to personal development and enduring enthusiasm that it takes to achieve in any other field. What it does offer is a lot of opportunity, support and flexibility.”