Tag Archives: Home business

Tracking Business Expenses in Direct Sales

Not many people enjoy having to do the books. But, if set up properly, and with the right knowledge, they are not as cumbersome.


Expenses in Direct Sales (Photo credit: Phillie Casablanca)

For anyone who runs a business, they know that one of the tasks that must be accomplished is the accounting. For some, this is a job which they hate as much as toilet cleaning, but it is one that has to be done. Even if you use an accountant do to the final year end papers, if you do a good job with the day to day books, their job will be easier. Here are some ideas to help with tracking the expenses so that it will not be as much of a hassle.


  • Have a separate bank account for your business expenses
  • Put as many of your expenses on credit cards as possible
  • Create a place where you put all your receipts for when you sit down to do the books
  • Depending on how much paper you have, put everything for each month in one envelope
  • Have a filing cabinet so that if you have a lot of paper you can organize things in categories

Know Your Expenses

If you categorize your expenses correctly, it will end up helping you in the long run when it comes to tax time. This list assumes that you are running a business outside of your home, as there are other deductions that you are entitled to with a home based business.

  • Advertising – business cards, web site marketing
  • Insurance – Business insurance – does not include health insurance premiums
  • Interest – Any interest you pay on accounts such as credit cards or loans
  • Legal and/or professional services – Accountant or lawyer fees that you pay
  • Office Expenses – Anything beyond supplies for your office
  • Rent or lease – Premises or equipment
  • Supplies – Paper, toner, notepads or anything else routine
  • Travel – Cost of travelling to conventions or meetings
  • Meals/Entertainment – Amount paid for meals or entertaining clients. This has a special tax ramification which is why it should be separate
  • Utilities – Gas, electricity, telephone, Internet
  • Dues – Subscriptions to magazines or trade groups your business is a member of
  • Other – Any items that you are not sure where they belong can be put here

Make sure you keep the receipts that go with all of these expenses, as you will need them to show your accountant and possibly the IRS. But if you can get your expenses itemized through the year, it will make it easier for your accountant and you will spend less money.

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Do I have enough time for direct sales?

IBM Lotus Organizer

Image via Wikipedia

One of the best things you can do for your direct sales business is to sit down with your calendar and figure out your schedule.  You can do this to help you make the decision if you have time for a direct sales business and then in the future to keep yourself organized.

  • Mark in your shifts at work if they vary
  • Mark in your partner’s shifts if there are children and someone has to be home with them
  • Mark in anything that you have committed to that cannot be moved. I.e. Sports, events, appointments
  • Mark in anything else you have to remember
  • See what kind of time you have left
  • Do not forget to make sure you have some “me” time so you do not burn out

Keep in mind that you do not only have to do parties when in direct sales to make money.  It is the easiest method but you can do well with catalogue parties or individual sales if you promote them enough.

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Home based business vs a Retail business?

Chances are you already know the benefits to having a home based business instead of having a retail business, but just in case, let us review them. Maybe we will stumble upon something you are not aware of.

Flexibility – When you work out of your home, you have the flexibility to do things when you want and how you want.  This is especially important with direct sales as you can book events when you want to do them.  Have a kid’s birthday party?  No problem, don’t schedule an event that day.

Time Commitment – You can make just as much money in a few hours in direct sales as you can working an eight hour shift somewhere else.  If you work your business well, you can pretty much be guaranteed whatever income you are looking for.

Cost – Ever wanted to start your own business but you only have a few hundred dollars?  No problem!  I have not run into any company that costs more than $500 to start up!  And depending on the company, you may even be able to earn that sign up fee back!   Have you ever heard of starting a retail business for that amount?  Chances are you going to pay more than that in rent per month.

Profits – Not only is it cheap to get into direct sales, but you make profits fast!  Even if you do not get your kit for free, within doing a few thousand dollars worth of sales (depending on kit cost and commission level) you have made back your investment and are into profits!  Try doing that in a retail setting.

Tax Write-offs – This is a favourite for everyone, the write-offs you get working from home.  You are able to write off portions of your car, your fuel, the products you buy for yourself and family (product testing is important, right?) and so many other things.  Always check with your tax accountant or buy a proper tax program to help you with this.  But make sure to keep a mileage book and all receipts until tax time.

I have heard some people say that if you own your home, it is stupid not to run some sort of home based business, at least for the tax write offs.  But imagine getting into direct sales and being able to make money relatively easy, and get the write offs to go with it.  Win win!


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Advertising your Direct Sales Business – Part 2

Did you read part 1?  Did it make sense?  Let us continue on how to write our advertisement to get people interested in our direct sales opportunity.

Advertising advertising

Advertising advertising (Photo credit: Toban Black)

Graphics – Graphics are great to get people’s attention, but do not overwhelm them.  If you have 100 words of text, you should not be using three different graphics.  One is likely the maximum for that amount of words.  Use too many and your ad will get lost with the pictures and the person will move to the next ad they see.

Be Prepared to Answer Questions – This is a big one when it comes to placing ads.  It does not matter how much information you put in the ad, you are going to get questions.  But questions are good as you can give out more information and personalize it based on what the person is asking you.   Depending on their interest level, this can go back and forth for a while.

Do not Overhype – A big turn off when it comes to ads is reading an ad that promises the moon if you join that direct sales company. There is nothing wrong with putting things in the ad such as earn a cruise, earn a car, if these are incentives that your company offers.  But putting in something such as join this company for financial freedom can be a bit of an over-promise and may cause some people to believe you are offering some sort of scam and run far away.

Length – It is important that your ad is the right length.  But what length is that?  Well, less than two pages but more than two lines.  Keep in mind people do not have very long attention spans so the more they have to read, the less likely they are going to quit and move on.  Bullets and bolding can be very helpful to get your points across.

Proof the Ad – Ask a friend to read your ad and tell you if it complete or if it needs more.  Ask them to be honest with you.  See if the ad has enough information to entice them to ask for more information or if it seems to be over-promising to the point of being a turn off.  It may be helpful to ask more than one person to check the ad over if possible.

Come back on Friday where we talk about power words and other wording to use to help attract people to your direct sales opportunity.

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Writing Powerful Ads for Your Direct Sales Opportunity

When it comes to writing your ads, there are words and sentences that you can use to assist you to make your ad more powerful.  Here are some things to consider.

Title – It needs to capture the attention of your audience and make them want to read more about what you offering.  It does not have to be long but something that gets attention.  “Join my team” is likely not going to encourage people to read but “Join my Million Dollar team!” may get more interest as they see the word “Million” and want it.

Value of the Offer – The body should make sure it answers whatever is promised in the title.  For instance, if you saying “Join me and earn a car” the body should say something about how they are going to earn this car.  You also do not want to discount other important factors such as it is a selling job and whatever else you feel is relevant.

Unique – Why is your offer unique from those other ones out there?  Is your company the only direct sales company that allows their consultants to earn a car?  If you make this claim, it is important that you know it is true as if there is another company has this same incentive, you can be sure someone will let you know about it.   And depending on who they are, they may want to make sure the rest of the world knows that you screwed up.

Power Words – There are words out there that are powerful and therefore, you also need to use them sparingly.  For instance, “Free” is a power word, but if people use it too much it loses that power and people tend to ignore it.

This is just a bit of information to help you write your direct sales advertisements more effectively.  To do a really awesome job, take a bit of time to do more research and soon your ads will be converting like crazy.

Make sure you check the posts – Advertising Part 1 and Advertising Part 2 –  on how to write an effective direct sales opportunity advertisement.

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How a Blog can Help Direct Sales

If you’re online, you’ve heard of blogs – you’ve probably even read a couple of them. So you have an idea of what a blog is.

But have you thought about using a blog as a marketing tool in your own business?

It seems too hard


mappa_blog (Photo credit: francescopozzi)

Let’s look at the usual negatives first as you need to answer these before you can see the value of a blog.

  1. I don’t have any money for marketing
    Blogging costs more time than money – blog software is free and you can have it hosted for free, too (whether that’s the best option we can discuss another time!) All you have to do is write some posts – any other expenses are optional.
  2. What can I write?
    About your products and parties is the simple answer – include stories of people using your products (as intended and in creative ways), testimonials and unusual parties (different times, locations and themes are interesting). Add in company and personal news and things you learn along the way, and your blog is filling up
  3. I’m not good at writing
    You don’t have to be Shakespeare to write a blog so don’t be too hard on yourself. If you really can’t write, get some help with the writing or have your work edited, and start reading up to improve your writing skills
  4. My direct sales company won’t let me
    Make sure you understand the rules properly – you may be able to blog without naming the company for instance – but this point must be considered to stay with any agreements you have signed.

Advantages of blogging

You’re running a business and you want people to know about it, yes? Well, here are some ways that a blog can help you achieve your goals:

  1. You get more exposure to potential customers and recruits – directly through the blog but also for additional traffic to your main website if you have one
  2. It is cheap so you can blog even if you can’t afford much else in the way of marketing
  3. You can show people who you are – if I read your blog and feel friendly about you I am more likely to host a party with you than if I just see your name in a directory.
  4. You get to show off your knowledge of your products so I can trust you to lead me to the right product for my situation
  5. You show you are generous and caring by sharing information so I trust you – this could be really important if I am dubious about direct sales people
  6. You can build relationships with people – answer queries in the comments section, use real life questions and situations as posts, and refer to real people you do business with (you may be surprised at how happy Mary will be if you post a story about her party and the to-die-for chocolate cake she served.)
  7. If you don’t have a website, a blog can be a central place for people to find your contact details (I bet many people would call you back even years later if only they could find your details again), display testimonials and refer any social media efforts towards

Have you used a blog in your business? What rewards did it give you?

Interested in blogging but unsure of where to start? Tash Hughes’ blog contains tips and ideas about blogging, improving writing skills and communicating effectively.


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Advertising your Direct Sales Business – Part 1

Chances are, you are looking to increase your business with advertising.  But are you doing yourself a favour by writing effective ads or are you just tossing your money out the window by not knowing what you are doing?  If you aren’t sure, here are some tips to assist you with writing an effective recruit ad.  You can use these tips to help you write a good sales lead ad too.

Name your Company – How often do you see an ad where they discuss the benefits of the company but do not state who they are?  I know I have.  I don’t want to contact them for more information as maybe I have had a bad experience somewhere or because I want to research before I make contact.  There goes a lead down the drain.

Start Up Costs – This one is a bit trickier.  One of the most common questions I get in response to an ad is how much it costs to start.  With my company, there are two different price points as well as a way to earn your kit free.  For this reason, I do not state that it costs X amount to join.  But I do state that there are two different kits to start with or that they can earn their kit for free.  Usually that gets enough interest for them to ask me more.

Quotas – Many companies have a quota of some sort.  Whether it is placing one order every three months for Y retail value or it is Z value every six months.  It helps to be up front about it by staying that there is a monthly/yearly quota involved.  If they are interested, they will ask about.  If it is something simple like submitting one order of any value every 6 months, you likely will want to say that right in the ad as people will like to know that and may put your company in the running when it wasn’t previously.

Slang – Like any industry, there is slang that those in direct sales uses.  Keep that out of your ad.  There is a good chance that the people who are reading your ad are not familiar with the industry jargon and it is just going to confuse them.  Use plain English.  If you aren’t sure if you are, ask a friend to read the ad over for you.

Come back on Wednesday to read about more elements of making a good advertisement for your direct sales business.

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Why Discounts can Be Dangerous in Direct Sales

Everyone loves a discount, except the person selling the product.  But, keep in mind that depending on where you are shopping, their markup could be at least double their cost, making a 50% markdown equivalent to their cost.  Unless you are receiving that much in commission or you enjoy losing money, you cannot afford to give that type of discount within your direct sales business.

De-valuing Product – One of the biggest arguments against giving a discount to customer is the fact that they will come to expect it in the future.  This is especially true if you offer the discount to a hostess and her customers in order to get them to book a party.  Once you do this, it will be expected the next time and they likely will not even book until you promise them the same incentive.  You may even have to increase the discount to the point that you are losing money on the party.  Not only will this hurt your business but it will hurt other direct sales consultants as the customer will approach others in the same business expecting the same deal.  They may even try approaching consultants with other companies to get the same benefit.

That said, there are times that a discount is appropriate such as clearing out older inventory that is no longer in season or that there is an issue with such as a crack or tear which does not affect performance.

If you feel the need to give a discount, you may want to consider offering a bonus or gift with the purchase instead as an incentive.  One good reason to support this is that if they try something else, they may like it and purchase that in the future as well.  This can be a great way to increase your sales instead of decreasing them with a discount.


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I see a lot of people saying how wonderful their direct sales business is. I would love to join if I was guaranteed that success. Does everyone achieve that?


Image via Wikipedia

Unfortunately, no. This is due to a variety of reasons.  Some people give up before they even start – meaning that they give up quickly as people are not jumping out of the woodwork to host a party.  Others do a few parties, get the start up incentives, and quit after that.  Others are just in the direct sales business to get their product at discount and if they make a few dollars, even better.

If you pick the right product, are determined, and don’t give up easily, you definitely have a better chance at doing well with your direct sales business.

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How long before I see profits?

This is another loaded question that will really depend on you and your direct sales business.

The first factor is how much money you spend to get your direct sales business started.  If you purchase your kit and nothing else, you are going to see profits faster than if you purchased a kit, extra business supplies, extra product and spent a bunch on advertising.

The next factor is how fast you get out and make sales.  And of course, as you make sales, you are using up supplies and need more.

If you get started quickly and do half a dozen parties in the first month, you should recover your investment pretty quickly and be onto profit with your direct sales business.


Kit – $150 purchase price –

Assuming no need to purchase any more supplies or do advertising

6 parties x $400 sales  = $2,400 sales

$2,400 x 25% = $600 proceeds

New supplies needed = $50 (catalogues, order forms)

Original investment = $150

Net proceeds = $400

Of course, this is just an example and in a perfect world.  You may do less sales, you may spend more to get started, you may spend less to replenish supplies.  But you can do something similar to this to figure out what you will need to get back your investment and start making money in your direct sales business.

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