Who Can Help You Take Control of Your Finances?

Due to the economic downturn, many have found themselves jobless. It couldn't have come at a worse time in America's history. The cost of bare necessities is rising through the ceiling. The rate of unemployment has jumped to 7.4 percent, the worst it's been in 25 years.

If you've thought of starting a minimal-investment business to garner income, there are plenty of opportunities. Avon advertisements are touting the company as one opportunity.

If you've considered becoming an Avon representative, it would be helpful to have a balanced view of this micro-entrepreneurial company and global market leader.

Have you seen an Avon brochure lately? I picked one up the other day. The cover reads: "Take Control of Your Finances. Join Today. Make More Money in 2009."

Avon has become a household world. The company has been around for 127 years, has survived every major economic collapse and done quite well. Avon is one of the top five direct selling companies in the world. The question remains: can you really make more money in 2009 selling Avon?

For 18 months, I was a part of the Avon family as an independent representative and sales leader. In nine months, I sold more than $20,000 in Avon products, and I got the awards to prove it. I was often among the top 10 in my district, either in sales or recruiting or both. There are women who actually do earn six digit incomes for the company and themselves, but not many.

Newcomers to the business should be aware that the recruiting dialogue and literature they're given during sign up could be misinterpreted.

For instance, you can earn up to 50 percent on the Avon products you sell. That percentage depends on the amount of total sales. In other words, the more you sell, the more you earn. Secondly, Avon is licensed to sell items produced by other companies. Commission on these items is only 20 percent, 25 percent if you're a top earner. Representatives earn little or no commission on Pink Ribbon products offered to benefit the fight against breast cancer.

So, what does all that mean for a representative whose campaign sales is $400 at 35 percent commission? A closer look at this representative's invoice shows that nearly $200 in sales generated on products with commission of only 20 percent. Additionally, they may have sold $50 worth of Pink Ribbon products translating into no commission. It means that after this representative has paid for the products, paid taxes, bought supplies and paid other expenses associated with the business, they may only have $50 to show for it.

Another challenge representatives face is when the company introduces new products, such as in the skin care and fragrance categories. Avon introduced a total of eight new fragrances last year. Two of them were designer fragrances priced at $30 or more. When I introduced these new scents to my fragrance customers, they showed little or no interest. They were purchasing other favorite fragrances that were on sale. Buy one get one free. They would tell me, "I'll wait until it goes on sale." When customers purchase products on sale, it's great savings for them, but it hampers representatives who could have earned $24 on two bottles of cologne, but will now only earn $12, if that much.

Avon has done a phenomenal job in the skin care category, offering first to market creams, moisturizers and treatments. They've remained competitive in a market that is steadily growing. The problem some representatives are faced with is the price of these items and how their customers perceive them. The newest skin care line is priced at the higher end. If your target market is more bargain-oriented, they are not going to buy a jar of cream for $54 no matter how great the sample felt.

I was a firm believer in getting out there everyday, servicing current customers and finding new customers. I had over 300 in my customer base; very few of them ordered these high-end skin care products. The company touts skin care as a great money making opportunity. It's not much of a moneymaker if you can't sell it.

Representatives who do earn the dream commission of 50 percent are the ones who market their business everyday. To get a bigger reach, they enlist helpers. Representatives keep their helpers happy by rewarding them. Some reps give helpers 10 percent discounts off their orders, or 10 percent of the total orders. The problem is, if most of their customers' orders consist of 20 percent items, and the representative gives them 10 percent, they're giving away half their profit.

By the time Representatives pay for the products, buy brochures and supplies, pay taxes, reward helpers and factor in the cost of advertising, gas, car maintenance and business licenses, they have less and less to show for their effort.

Direct selling is just one side of Avon marketing. The other is multi-level marketing. The Representatives with six figure incomes are those who've recruited and trained a team of sellers that runs both deep and wide. That takes time and patience. It takes money, too, because the sales leader has to travel, rent meeting spaces, provide refreshments or meals, attend conferences and purchase training materials.

The question is can you make money selling Avon? The answer is yes. But like all businesses-both brick and mortar and the ones we haul around in our cars - it takes time, patience, and business tenacity. If you can stick with the company through every hurdle, then who knows. You may be one of those six-figure earners one day. Maybe not in 2009.