Speaking of downlines, some companies require them, and some do not. If you form a downline, you recruit other consultants into the business and often earn commission on their sales. If you're comfortable with this idea, you will likely do well at recruiting your home party attendees into the business.
Nancy Bogart, who founded her $3 million Nixa, Missouri, bath, body and spa products company, Jordan Essentials, in 2000, has a system in place where new recruits are walked through the first three months of operations. Conference calls, newsletters, a DVD and online support are just a few of the resources offered to consultants. New recruits purchase the $89 starter kit, which includes a sampling of retail products, a personal website and other tools. For orders you place as a result of your parties, "there's no minimum order, and there's no inventory to carry," says Bogart, 38, who has about 1,500 independent reps to date and projects up to 1,000 new consultants by the end of the year. The company's core product, a lotion bar, has been a mainstay for its success, with 600,000 sold in six years.
Before you start recruiting, however, make sure to find out how much training and support you get from any potential business opportunity, both during startup and on an ongoing basis, so you won't be left putting up all the party streamers on your own.
If you'd rather not recruit a downline, find a company that doesn't require one, such as Anna William handbags. "We actually don't have a system like that in place," says Kristen Lee, co-founder and director of consultant operations for Anna William. "There is a referral bonus, but most of our consultants are previous customers--many of them from our retail locations. They're people who say, 'We love this and wish we could do it where we live.'"
Anna William got its start in 2003 with a Newburyport, Massachusetts, retail boutique, where customers design and make their own handbags using materials supplied by the store. "But people wanted the parties to come to them," says Lee, 29. That's when the four co-founders--Lee, plus Keek Bielby, 57; Rani Chace, 36; and Erin Hornyak, 33--decided to branch out into home parties. Anna William still has its retail locations (the first one, plus one they opened six months later in Cambridge, Massachusetts), but the opportunity is quickly garnering attention from women looking to do something creative. The million-dollar company now has more than 100 consultants nationwide, and it donates a portion of sales to select charities.
THE BIG PARTY
One of the secrets that makes the home party method such a hit is that customers get to try before they buy and learn about the product from someone who will explain everything about it. Taking the time to carefully plan your party will pay off not only in terms of the sales you make at the party, but also in the repeat sales and potential new recruits you'll attract.
It makes sense to host a party in your own home to start, but don't neglect friends and acquaintances' homes as potential venues. In this case, Connie Keith recommends first sending a packet of information to the host. "Book your parties three to four weeks in advance," says Keith, 39, who joined The Happy Gardener Inc. in January 2006. "About two weeks out, make sure the host is getting RSVPs, and answer any questions on the company from potential guests."
Confirm a head count a few days prior to the party, and give the host some options on the type of party you want to have. Keith offers anything from simple product demonstrations to more specialized workshops, such as seed starting or flower arranging. "Probably 95 percent of guests want to sit down and do planting and other hands-on work," points out the Omaha, Nebraska, entrepreneur, who sells about $450 to $500 worth of products per party and also earns a percentage of sales from her downline.
This kind of low-pressure interaction with guests is likely to be the most effective. This is why Keith limits her group size. "Ten to 12 is about as big as you want," she says. "Anything smaller, and people tend not to ask a lot of questions; bigger than 12, people get distracted."
Once the demonstration portion is complete, "I make myself available for any questions as people order, but I don't hover," says Keith. Most important, she follows up with guests after the party. Keith keeps a database of customer orders so she can target-market and refill orders.
Perhaps the most satisfying aspect of planning and executing a successful home party is that even when the party is over, it's not really over. And the next one just might be more successful than the previous one. "This is a relationship business," says Robinson. "It's all about service after the sale."Karen E. Spaeder, former managing editor of Entrepreneur magazine and editor of Entrepreneur.com, is a freelance writer in Southern California specializing in small business and education.
Karen E. Spaeder is a freelance business writer in Southern California.