When we think about a business, we often have a unilateral idea about the concept. We understand business as a transaction between two parties where one extends to service, and the other buys that. Simply speaking, it is as simple as that. But, how the transaction between both these parties works can vary. There can be more parties involved in the transactions, and there can be more than one way to conduct it. According to these changes in the procedure, the business type varies. So today, let me introduce you to different types of direct selling and detail the differences between them.
Definition of direct selling
Direct selling is an effective and less costly way to build a highly flexible, low-cost business. It is a method of marketing and retailing goods and services directly to the consumers in their homes or any other location away from permanent retail premises. Word-of-mouth referrals largely drive such types of sales. Products sold through direct selling companies have unique features exclusive to the company.
The selling point of these products relies specifically on these qualities and the fact that they are not available in malls or other department stores. The direct selling industry has thrived on this relationship-based marketing type for more than 150 years. Approximately 100 million people worldwide are involved in this industry in both part-time and full-time capacities. So now, let’s learn about the different types of direct selling and how they differ from each other.
Types of direct selling
The business model, which eradicates all forms of intermediaries from a business model and makes the selling process exclusively concentrated on both the seller and buyer, is mainly categorized into three distinct types based on certain features. They are Single-level direct sales, Host or Party-plan sales and Multi-level marketing. Well, let me explain the difference between each of these direct-selling business models.
Single-level direct selling
Single-level direct selling is a sales method where a single individual makes the sale. This method relies heavily on door-to-door or in-person presentations, catalogues or even online meetings. The sales executive earns an income through sales commissions, and bonuses are added to these when they achieve a particular target.
Host or Party-plan selling
Unlike the single-level type of direct selling, in the party-plan selling mode, the sales take place in a large group setting. In this mode, a distributor or direct sales representative conduct a representation of the product or service they offer. This demonstration will usually be staged at the representative’s or direct seller’s home or the customer’s home. Just like the single-level type of direct selling, here, too, the revenue of the direct seller depends on the sales they make.
Multi-level marketing
The multi-level marketing model of business differs from the types mentioned above of direct selling. This model can make use of both single-level and party-level types of direct selling. But, unlike the other modes of direct selling, an MLM marketing seller will not only earn money through the sales commissions but also based on the number of distributors they recruit for the company.
Yes, this business model may be more familiar to you in the term pyramid scheme. One important thing you must understand when it comes to sot, MLM is that while it is a form of direct selling, it is not entirely direct selling. Not all direct selling practices employ this method of earning. Furthermore, almost all direct selling enterprises like QNET try to steer clear of the MLM mode of marketing.
Is QNET an MLM-based direct-selling company?
One can give a very simple answer to this question. QNET, one of the famous and reliable direct selling companies in Asia, is by no means a direct selling company that relies on the MLM type of direct selling. In QNET, any individual interested in referring and recommending our products to others can join the company as IRs or independent representatives.
Just like any other type of direct selling, they earn money through and only through sales. QNET doesn’t promote or reward recruitment policies or pay in any form to the IRs for adding or recruiting direct sellers to the family. So, in short, QNET is a highly reliable direct-selling company that earns a profit solely through sales. If you want to know more about the different types of direct selling or if you want to know about QNET in specific, then visit our QNET official page. We will be more than happy to help you find your way and place in direct selling.