* Calculations are based on average data for Russia

Initial investments:

Average check:

Payback period:

Direct sales of cosmetics are still popular, as they are beneficial not only to companies and their distributors, but also to consumers, allowing them to bypass store markups. But the amount of profit in this business depends entirely on the seller.

Direct selling is a suitable option for your own business, especially if these are your first steps in entrepreneurship. The idea is relevant for women, mothers on maternity leave, students and anyone looking for a part-time job. Direct selling is an alternative to traditional work and a source of additional income. If you wish, you can build a full-fledged and profitable business on direct sales. This option is also suitable for novice entrepreneurs. After all, organizing your own business based on direct sales is quite simple: you do not have to rent premises, buy equipment and invest large sums. The main element of direct selling is the entrepreneur himself. The success of the business will depend only on his personal qualities.

You can open your own business for little money. To do this, you will need to purchase an inexpensive distributor kit. To start making money on direct sales, you need a budget from 0 to 15,000 rubles. This distinguishes direct sales from franchising and other types of investments, which require significant costs. It is rather difficult to name the exact amount of investments: each company has its own strategy and policy (moreover, both in the matter of attracting distributors and in the matter of paying for their work). Therefore, carefully study the different options and choose the one that seems the most suitable for your expectations and requirements.

Direct sales are beneficial not only to companies and their distributors, but also to consumers. Firstly, it is a high-quality service: product demonstration, personal consultation, home delivery and guarantees. Secondly, these are savings - often the prices for cosmetics sold directly are significantly lower. Thirdly, it is an opportunity to purchase unique products that are not on the shelves of traditional stores.

Direct sales: the situation in Russia

In Russia, the direct sales market has been developing for over 20 years. According to research, the main customers are women aged 30-55, and the average amount of each purchase is about 1,500 rubles.

Most of the large direct selling companies sell cosmetic products. In this area, there is a high customer loyalty: when purchasing the company's products from one representative, most buyers return with other orders to him. This form of interaction with the client allows us to provide an individual approach and inspires confidence in the buyer. Therefore, it remains relevant. So direct selling is still a popular channel for trade in cosmetic products.

Currently, the direct sales market for cosmetics is growing rapidly. In 2016, it grew by 11% and reached almost 120 billion rubles and continues this trend. At the end of 2017, direct sales of cosmetics amounted to more than 58 billion rubles. The popularity of direct selling is due to the fact that consumers are trying to save money, bypassing intermediaries (stores), which make a high mark-up.

You should also evaluate all the advantages and disadvantages of the business in order to understand what working conditions await you.

Advantages and Disadvantages of Direct Selling for a Seller

Consequently, direct sales of cosmetics have advantages both as a business and as a service format.

How to start a direct selling business

It is quite easy to open your own business of direct sales of cosmetics. The main thing is your ability to interest people and your desire to succeed. The rest of the nuances will be taught to you, and as you work, you will gain the necessary experience.

First, let's look at direct selling. This means the sale of goods or services, which occurs through personal contact with the buyer. Such sales take place in a place convenient for the client: office, apartment, restaurant, etc. - outside of standard retail outlets.

Features of direct selling:

Direct contact with the client on a convenient territory;

Personal presentation of a product or service;

Comprehensive advice from the seller;

The ability to try out the product before buying;

This is both a service and a presentation at the same time.

In general, the algorithm for doing business on direct sales of cosmetics includes 5 basic steps. Next, we will analyze each of them in more detail.

Step 1. Choosing a company and products

All direct selling companies are members of the Direct Selling Association (DMA). Choose those that adhere to the APT's code of ethics, conduct business ethically, and provide quality service. The list of companies can be found on the APP website.

The main requirement for the product is that it must be a unique and advantageous offer that is not available for purchase in regular stores. The market is oversaturated with offers of the same type, so if you find something new (improved, adapted to a narrow target audience, more budgetary, but no less high-quality), it will be easier for you to sell such a product. First, you can get your customers interested. People are drawn to novelties. Secondly, you will not lose interested consumers, since you are the only seller of such a product (the only one in the client's field of vision). Third, it will be easier for you to highlight the key product benefits and create an engaging presentation.

Please note that the uniqueness of the offer is not only a new product, but also services. Combine new product and convenient service. Come up with a new service that will make you stand out in the market. Buyers themselves will suggest ideas. Listen to them, consider their interests and expectations. Your task is to offer the best solution to your client's problem.

When you choose a company for cooperation and products you will have to work with, ask yourself the following questions:

How much money will it take to work with this company?

Is there a demand for your product or service? How new is your product or service to the market?

What training system does the company offer? Give preference to the company that provides education and training.

What is the remuneration system in this company? Find out all about earnings, bonuses, commissions, and liabilities.

What guarantees does the company give for the goods? Is a product return policy available? This is important for both you and your clients. Refundability is part of the service.

What are the conditions for going out of business? The reasons for leaving may be different: you did not like the actual terms of cooperation, you wanted to switch to another business, you did not receive enough profit, etc. Therefore, it is better to clarify all the nuances in advance, so that later you can do without unpleasant surprises. The APT's Code of Ethics requires member companies to accept back any unused product purchased within the past 12 months if the seller decides to go out of business. At the same time, compensation for the return of products must be at least 90% of the original cost, if no bonuses and commissions have been paid for these products.

Step 2. Determining the target audience and sales methods

It is necessary to determine the target audience and find clients. Your target audience is likely to be women between the ages of 30 and 60. The first buyers, most likely, you will find among your acquaintances. But to succeed in this business, you need to continuously recruit and develop a client base. The Internet will help. Find groups and forums where the female population of your city is concentrated. Leave an ad there. Create your work account on social networks and add as friends to your potential clients.

The standard direct selling methodology involves 2 main ways to attract customers. The warm market is made up of your acquaintances. Cold market - employees of offices, shops, where you come with catalogs. But it is not always advisable to spend money on buying a stack of catalogs. If you are looking for clients via the Internet, it will be enough to throw off the link to the electronic version of the catalog.

The sale of goods involves a step-by-step interaction with the client. You need to think over the strategy and each stage: from acquaintance to the conclusion of the deal.

The success of direct selling depends entirely on the professionalism of the seller, which includes the ability to:

identify the needs of the client;

present a product;

emotionally affect people;

find an individual approach to each client;

work with failures.

Many novice entrepreneurs are stopped by the stereotype that only “natural sellers” can engage in direct sales. people who are able to sell without special training. However, this is a misconception. Anyone can master the method of direct selling - the main thing is desire and a well-developed strategy.

Step 3. Choosing a strategy

First of all, you need to clearly define your goals. In the direct selling cosmetics business, there are three key goals:

1. Find products that you can profitably sell;
2. Sell additional products to the same customers, increasing profits;
3. Collect a customer base - ie. compile lists of e-mail and mailing lists.

Ready-made ideas for your business

Once you have decided what products you will sell, you need to choose a method of work. The first option is to buy the most popular products and sell, first of all, the available assortment. Two advantages come together here: product demonstration and instant purchase. This makes the service more convenient for the buyer. After all, cosmetics are products that are better to choose not from catalogs, but in reality. Catalogs cannot convey the exact shade, structure, smell of cosmetics. So the availability of the offered product will win over the client to you. In addition, people do not always buy cosmetics for future use - many remember that they need to buy mascara when it runs out. In such cases, the client is unlikely to wait several days for the order to go through the entire chain from you to the manufacturer and back. Therefore, the opportunity to buy products “here and now” also increases consumer loyalty. The main disadvantage of purchasing goods is the money issue. This will require a lot of investment, which may not pay off. There is a possibility that some positions will not be sold, and they will hang like a dead weight among the assortment. You can avoid this if you clearly understand the needs of your audience.

The second option is to act as an intermediary, and thereby do without investments. In this case, you will act according to the following scheme: you fill out a receipt for each individual order and send it to the wholesale supplier, who forms the order and mails the goods directly to the customer. That is, in essence, the wholesale supplier acts as a warehouse. Your profit is the difference between the wholesale and retail price. It is possible that the generated orders come back to you, and you personally transfer the order to the client. With the main advantage, everything is clear - you do not have to invest your own funds and take risks. But the disadvantages include:

the time and postage costs incurred in delivering orders to the supplier;

the wholesale purchase price goes up and your profit goes down.

In most cases, entrepreneurs use both options in their work: they invest in the stock of the most popular product, and for more rare items they use intermediation.

Another important step is data collection. Remember to record the details of each customer, including what and when they purchased. This will help assess the demand for specific products and determine the needs of each client in order to interest him in a new proposal in the future. Collect the names and addresses of your customers as well. This will build your mailing list. When you use the data you collect wisely, it will be the foundation of your direct selling success.

It is best to compile a computer database. The mailing list should contain the following information: full name of the client, his postal and e-mail address, telephone number, notes with data on when and what exactly the client ordered. By the way, your mailing list itself can be a valuable commodity - some resellers will be willing to pay for a customer base.

Step 4. Exploring the legal issue

In whatever area of ​​business you work, it is important to know the legal nuances of your activity.

Direct sales in the Russian legislation are considered as traded trade and are a type of non-stationary retail trade. Currently, direct selling companies in the course of their activities rely on:

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