Direct profit

Some find time, income benefits by selling from home

Friday, Oct. 10, 2008

Click here to enlarge this photo Staff photo by DARWIN WEIGEL Dee Chenault, left, of St. Leonard, is a new Mary Kay consultant in training with Rose Hacker, in Hacker's St. Leonard home. Hacker is a senior sales director and has been with Mary Kay for 11 years. E-Mail This Article | Print This Story

She had set up a few of the home decor products she sells as a home-based consultant in Karla Radtke's Waldorf home. Catalogs filled with such products lay in a stack on a counter. Radtke's hors d'oeuvres were arranged on a foyer table.

Radtke was recruited by a friend to host this home selling party and was in charge of bringing friends and family to the early-afternoon event, at which Vass would make a presentation on new Southern Living at Home items. There would be laughing, shopping, games, food and more shopping.

This is how she — and many other Southern Marylanders — make a living.

In times of corporate layoffs, low consumer confidence and higher costs of living, the direct selling industry has seen steady gains in revenue and its number of consultants over the past couple of decades. These companies recruit home-based salespeople who sell just about everything, from beauty and skin products and jewelry, to cooking items, scrapbooking materials and home decor.

But last year the National Direct Selling Association saw its first sales and consultant recruit declines in years — albeit relatively small — but it is evidence that the country's current economic downturn has managed to affect even the fastest-growing industries that had never felt economic pains before.

"Twenty-plus years ago, direct selling was more counter-cyclical — doing well during hard times and perhaps suffering during more prosperous times. More people looked to direct selling when times were tough," said Amy Robinson, vice president of communications and media relations for the NDSA. "But analysis of past data reveals a bit different trend. In fact, during the last official recession in 2001-2002, we did notice a bit of a spike in both sales and sales force when compared to the rest of the economy. Interestingly, though, since that time we have seen direct selling move in much closer rhythm with the economy."

Last year, national direct selling sales were $30.8 billion with 15 million direct salespeople. In 2006, there was $32.18 billion in sales and 15.2 million salespeople. During 2006 the industry grew 5.6 percent. Between 2002 and 2006, it grew 3.8 percent.

The NDSA predicts there are 275,000 direct sellers in Maryland, who take on the work as a means of earning extra income, having a flexible schedule or for new opportunities to meet other women.

But Southern Maryland consultants say economic distress hasn't much affected their businesses and many aren't in it solely for the money, anyway.

"My assessment is that whereas 20-plus years ago people with full-time jobs were not interested in picking up extra work until there was a true crisis," Robinson said. "Today many people are looking for supplemental income at any time. Even someone earning an adequate salary might desire extra spending money. Of course, in times of need, direct selling is always an option, but the flexibility of direct selling allows many different people with different motivations an opportunity to reach their goals … and the products, especially the low-ticket items, are things that people are interested in buying — perhaps those little luxuries, or even staples such as vitamins, that they still buy even when pinching pennies."

"The market has not decreased for us at all. The way the economy is, you need something people are going to use on a daily basis," said Rose Hacker, a senior sales director for Mary Kay based in her St. Leonard home.

Vass became a direct seller with Southern Maryland Living at Home, a home decor company, after retiring from a 23-year career in corporate mall management.

"I was a regional vice president for 12 malls in six states. For me, trading in the 50- to 60-hour workweek for an opportunity like this has been great," the La Plata resident said. "In 2 1/2 years I've taken five all-expenses-paid trips to exotic locations just for doing what I would have been doing anyway. In 23 years in mall management that never happened.

"Women need to get together," she said. "It's a contemporary version of a quilting bee. The expansion of my network of wonderful women is incredible. Being a businesswoman, I heard that opportunity and realized this was the same ground-floor opportunity that Mary Kay was. I also love the products."

Vass has worked her way up to a director of about 42 sales consultants in Southern Maryland.

They are women with children who want to get out of the house every now and again, women who need extra money for vacations, to send their kids to college or for their sports and cheerleading expenses.

"Whether you want to decorate your home for free, make more friends or spend extra money, there's always reason to do what I do," Vass said. "That doesn't surprise me. If you think about it, there's been a lot of corporate changes and when times are a little tough, one of the ways to know you have a secure job is to do it yourself and ensure your income. You have flexibility. You can work as much as or as little as you want."

"The main reason I started was I started having children," Hacker said. "I was a corporate travel agent. My husband was military. I started in Michigan and then moved to California and then came to Maryland. I wanted to be at home with my girls and be able to work around their hours."

But for Oakville resident Linda Morris, becoming a consultant in February for the scrapbooking company Creative Memories was about getting the products she loved at cost and having something to do after she retired from the Prince George's County court system.

"I'm a firm believer that if you want to have a home-based business it should be something you enjoy doing. I figured that if I could start selling [Creative Memories] myself it would allow me to get my products at cost and make profits with other customers. I did not do it for my sole source of income. I'm retired. It's just a little extra," Morris said.

She spends about an hour a day on administrative tasks related to the business in addition to hosting home selling parties and workshops on weeknights and weekends.

"You can sit in your pajamas with a cup of hot tea and do your business. I don't regret it at all. It's fun. It's perfect for the stay-at-home mom and it's perfect for me because I don't want to retire in my job and not do anything," she said.

Kimberly Tutz, a Mary Kay consultant in Hughesville, also started as a way to get the products cheaper four years ago but the business has grown drastically since time passed.

"After being in a couple of months, I went to one of the company's fall retreats for the weekend and really got to see the bigger picture. For me, it was about having young kids and wanting to add to our family income and being able to stay home with them," she said. "It's taken off. There have been a lot of layoffs in corporate America and the nice thing about Mary Kay is it's a debt-free company.

"There's a lot of job security. Even though times are tough, skin care is a necessity. People also need cosmetics to make them feel good. It's one of those recession-proof items."

But home-based selling isn't for everyone. Sometimes companies require new consultants to buy a large amount of inventory to start or a starter kit, and it requires some time to build a customer base, set up home parties and follow up with sales calls.

"You have to work at that business to make it work for you. I couldn't do it if I had a full-time job. It's not for everyone. You have to make a baseline of customers," Morris said. "It can be a very profitable business. The thing with any type of business, the money really is in bringing people into the business [recruits to sell products under you]. They encourage you to form a team."

"In Mary Kay, the product sells itself. The really, aggressive pushy people, they don't do well at Mary Kay because they don't get it. It's about making people feel good," Hacker said.

Radtke said as a more behind-the-scenes person who works full time, she's better suited just being a customer of home-based stores.

"I'm more confident being the hostess than I am stepping into her shoes. And I'm still a newlywed. Being on the go on the weekend would be cutting into my husband time," she said.

Mary Sparks of La Plata, one of Radtke's partygoers, said she used to sell Beauty Control for years while raising her children as a stay-at-home mom, but when they grew up she needed to be busier and wanted more income.

"I needed to go back to work so I could retire sometime. I met lots of people. It was time to be busier. So now I just go to parties. I just like the products," Sparks said.

"It's obviously easy and fun," Vass told Radtke's guests on a recent Saturday, of becoming a consultant. "But you can't do something halfway and expect to have full-time results. Good time management is important and to continue your education and perfect your skills, just like in any business."

kkulp@somdnews.com