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December 02, 2011

Cover Story

Breaking the Cycle of Unemployment

by Amy Bell


Click here to order the Direct Selling News issue in which this article appeared.


As 2011 ends and everyone prepares for the new year, this nation’s shortage of jobs will continue to dominate the political and social conversation. Missing from the mainstream voices, however, is the simple yet brilliant solution available in the direct selling industry—top-notch training and personal-development opportunities offered with astonishing depth, regularity and variety.

Amazing Training for Amazing Women

Amazing Training for Amazing Women

Belcorp USA is taking personal development to a whole new level by reaching outside of their network and training the women who need it most. Amazing Women, a groundbreaking training program from Belcorp Foundation, teaches women how to become successful entrepreneurs and agents of change in their communities. The first Amazing Women program will launch in San Francisco and be available to any low-income woman in the community who is interested in becoming an entrepreneur—regardless of whether or not she is a Belcorp Beauty Advisor.

Amazing Women was designed to train women in the areas of self-confidence, entrepreneurship, business education and social networking as well as on how to become financially independent. The training includes:

  1. Business Planning 101
  2. Money Management
  3. Personal and Emotional Empowerment/Professional Image
  4. Social/Business Networking

“This curriculum provides an excellent platform of building blocks for women who want to start a new career, reintegrate into the workforce or become an entrepreneur,” says Mona Ameli, General Manager of L’Bel/Belcorp USA.

Direct Selling News first covered these ideas in its supplement in The Wall Street Journal called The Ultimate Social Business Model, which offered up the story of direct selling companies for WSJ’s readership. DSN continues to explore these themes as the jobs crisis continues, adding its voice to the conversation by highlighting the hope and opportunity that direct selling provides.

The Bleak Reality

Some economists say the tens of millions of unemployed Americans who have lost their jobs since the dawning of the Great Recession will never again work the way they did in the past. Manufacturing has virtually vanished from the United States, and the residential construction industry continues to evaporate. Unfortunately, many of these jobs, along with positions in countless other fields, are never coming back—and unemployed workers from these industries are left floundering.

According to the Bureau of Labor Statistics (BLS), as of September 2011 there were 14 million Americans out of work and the unemployment rate held at 9.1 percent. However, the jobless situation may be even bleaker than we realize.

“We now have 20 to 30 million people not working,” says world-renowned economist, author and adjunct professor at New York University Paul Zane Pilzer. “However, the U.S. Department of Labor doesn’t count all of them because the Department of Labor says they aren’t looking for a job. Of course they are looking for a job!”

When calculating unemployment rates, the BLS does not count workers who are forced to take on a part-time job because they cannot find a full-time job. Nor do they count the millions of unemployed people who are “marginally attached” to the labor force—the folks who have become so discouraged that they’ve stopped actively searching for a job. Economic experts say if you throw all these people into the mix, it brings the grand total closer to 25.8 million jobless Americans, hiking the unemployment rate to a whopping 16.8 percent.

“The question now is not economic recovery but employment recovery,” Pilzer notes. Surprisingly enough, while throngs of unemployed workers are scouring the nation for jobs, approximately 3.2 million U.S. jobs remain unfilled. What gives? It all comes down to one glaring problem: a lack of training. Employers cannot find workers with the proper skill sets required for these jobs, a phenomenon known as the “skills gap.”

“The question now is not economic recovery but employment recovery.”
—Paul Zane Pilzer, economist, author and adjunct professor at New York University

In theory, the solution seems crystal clear. In order to become productive contributors again, millions of unemployed Americans must undergo training and develop new skills. Yet in reality, it’s not quite that simple. The majority of the unemployed cannot afford to go back to school, especially considering the skyrocketing cost of college. According to the College Board, average in-state tuition and fees at four-year public universities increased by 8.3 percent in 2011, and the cost of a full credit load has surpassed $8,000—an all-time high. When you add in room and board, the average list price for a state school exceeds $17,000 a year.

To make matters worse, most corporations won’t pay to train professionals who do not currently work for their company. It all comes together to create a vicious, cyclical problem.

“When [these unemployed professionals] went to school, they had a specific job in mind, but those jobs are gone,” Pilzer says. “I’ve been saying for 30 years there should be no unemployment paid after 90 days without mandatory job retraining. If your job hasn’t come back in 90 days, it’s not coming back. Functional skills need to be retrained.”

But how can these millions of unemployed workers obtain the training they so desperately need? Many of them are turning to direct selling. “The direct selling model will allow these people to get retrained while they are unemployed,” Pilzer says. “This model is outstanding because it gives people a break when no one else will.”

A Brilliant Solution

The direct selling industry is putting a dent in the unemployment cycle for numerous professionals. In fact, direct selling companies are some of the only organizations that offer significant, substantial training to the people who need it most—those who are currently unemployed—for little to no cost.

training“The direct selling industry is the solution to this growing problem, and that’s one of the reasons I love this industry so much,” enthuses Jon McGarry, Vice President of Sales with LifeVantage. “Network marketing is the wave of the future. It’s becoming mainstream for a reason—because it’s a business model that works.”

“Regardless of age, race, sex or education, direct sales provides the opportunity to learn new skills and to create more income.”
—Tony Petrill, Vice President of Sales with LegalShield (formerly Pre-Paid Legal)

Robert Kiyosaki, author of the best-selling personal finance book of all time, Rich Dad Poor Dad, has a lot to say about the value of the direct selling industry. In his book The Business of The 21st Century, a collaboration with DSN Publisher John Fleming, he writes that direct selling is the “business model of the future. Why? Because the world is finally starting to awaken to the reality that the Industrial Age is over.” This sentiment echoes Pilzer’s statements that the jobs that have been lost are not coming back. Kiyosaki goes on to say that direct selling “gives millions of people throughout the world the opportunity to take control of their lives and their financial futures.”

Glenn Williams, President of Primerica, a financial services marketing company, agrees, saying he believes direct selling is the ideal solution for unemployed workers looking to earn an income and simultaneously develop priceless skills. “We have always said that the training experience you get when you join Primerica, in and of itself, has value,” he says. “In our unique business situation, we are teaching people financial principles so they can use them to go out and sell and build a business … but obviously those are also applicable to them and their own family. Even for those who choose not to pursue Primerica as a business or a career, the training they receive is helpful to them personally, and it’s also transferable to other careers they may have in the future.”

The opportunity to receive low- or no-cost training is more valuable than ever in today’s tough economy. “Regardless of age, race, sex or education, direct sales provides the opportunity to learn new skills and to create more income,” says Tony Petrill, Vice President of Sales with LegalShield (formerly Pre-Paid Legal), a direct selling company that provides professional legal counsel to its members.

Consumer Segments Served by the Direct Selling Industry

Direct Selling companies offer products and services to consumers in a large variety of segments, including:

Products

  • Personal Care
  • Beauty, Cosmetics and Fragrance
  • Nutrition, Wellness and Weight Management
  • Food
  • Coffee and Tea
  • Jewelry
  • Handbags and Accessories
  • Clothing and Shoes
  • Home Décor and Home Fragrance
  • Kitchenware and Cutlery
  • Home Appliances
  • Home Cleaning and Care
  • Pet Care
  • Arts and Crafts
  • Travel

Services

  • Telecommunications
  • Electricity and Natural Gas
  • Home Security
  • Computer Support
  • Financial Planning and Investment
  • Insurance
  • Legal Representation
  • Real Estate

Closing the Gap

It should come as no surprise that the direct selling industry can help close the massive skills gap for today’s out-of-work professionals. Long before the economy took a nosedive, direct selling companies had earned a reputation for top-notch training and personal-development opportunities. “As an industry, direct selling has always been heavily involved in training, motivating and helping people develop skills they never knew they had,” says Noah Westurland, Vice President of Marketing with Agel. “If you look at the industry as a whole, the re-education/ training processes that we employ allow millions of people all over the world to provide a nice, comfortable living for their families.”

Another reason unemployed workers flock to these companies is that direct selling opportunities do not come with a laundry list of qualifications. “We don’t require a certain amount of education or experience to get started in network marketing,” says Gina M. Murphy, Vice President of Sales with Arbonne. “Our opportunity is available for anyone who wants something more out of life—whether it’s more income, freedom, flexibility, recognition, you name it. I feel the training and development in the industry that we offer is the icing on the cake.”

“What’s brilliant about network marketing is that we’re so willing to share with one other.”
—Gina M. Murphy, Vice President of Sales with Arbonne

Mona Ameli, General Manager of L’Bel/Belcorp USA, echoes that sentiment. “One of the easiest, most attractive areas of opportunity for those who join the direct selling industry is that unlike corporate positions, becoming an independent distributor for any direct selling company does not require any specific degrees, qualifications, experience, previous trainings or references,” she explains. That’s because once a person joins a direct selling company, he or she gains access to a world of training and development opportunities.

And because direct selling leaders never hesitate to share ideas, tips and success stories, Murphy says the industry offers some of the best professional development available in the business world. “What’s brilliant about network marketing is that we’re so willing to share with one other,” she explains. “It’s not like corporate America where everyone has their secrets—it’s a very open community, and that’s part of what makes it so special.”

“Will Work for Training”

Perhaps the most appealing aspect of direct selling is the fact that these companies provide training and personal-development opportunities at an extremely low cost—and sometimes free of charge. In fact, the vast majority of direct selling companies offer immediate, extensive training as part of their sign-up package.

For example, it only costs an individual $99 to join Primerica. Once a representative pays this relatively small one-time fee, he or she gains access to the company’s unparalleled training benefits. What makes Primerica training so valuable? Most notably, the company’s representatives have the option to become life insurance licensed—and if they qualify, they also have the opportunity to become securities licensed at no additional cost.

“That is a huge value because that cost, depending on your state or province, could be several hundred dollars for the life insurance license and it could be twice that much for the investment license—all provided for the $99 to join,” Williams explains. “So our representatives get the benefit of the knowledge and experience of obtaining those licenses, but then they’re licensed … and that license in and of itself has enormous value.”

Ameli points out that ease of entry is also a value add and just the beginning when it comes to benefits. “You can become part of a direct selling company by signing up with a limited investment fee ($70 for Belcorp USA), which you can easily recoup within a short amount of time once you start building your business,” Ameli says. She adds that direct selling companies typically provide prompt training for their distributors to help them quickly expand their businesses and become successful business partners. “At Belcorp USA, we start our training with our new Beauty Advisors the day they join our company.”

Murphy points out that training is completely free of charge to Arbonne consultants. “At Arbonne, we believe training is an investment in our consultants, and it shouldn’t be a profit center,” she says. “If we equip our consultants with the right tools and knowledge, that investment and training will pay off time and time again.”

Combatting Unemployment by Training Entrepreneurs

Ryan Blair, CEO and Co-Founder of ViSalus Sciences, a health and weight-management direct selling company, believes so strongly in the value of entrepreneurship and personal development that he has made the teaching of it a core part of his company. Blair told a recent audience, “One of the things I’m a firm believer of and why I love this industry and am passionate about it—and will do it for the rest of my life—is that we teach entrepreneurship. That is not taught in school systems. We are more of a force as the direct selling industry for entrepreneurship than the universities are or anything else.”

He backs up his word with a remarkable emphasis on entrepreneurial skills training and education through the ViSalus Academy, which includes an online training site, exclusive events, as well as webinars and training phone calls for Body By Vi Promoters. The company’s emphasis on developing first-time entrepreneurs and empowering them through education is definitely paying off—the company reports almost 3,000 new members per day are joining the Body by Vi Challenge, creating an unmatched growth curve in the industry today.

Blair describes his company’s work as an “educational effort,” adding “we’re all here for the same reason. We want to help others, mentor others. At ViSalus personal growth isn’t something we do, it is something that we are.”

Training Wheels

Of course, each unique direct selling company offers its own distinctive brand of training and personal development. However, most of these companies start with the basics: how to sell, how to present, how to dress for success, how to host a party, how to recruit other reps as well as essential communication and organizational skills.

training“In the beginning, the basics are most important,” says Peggy Davidson, Vice President of U.S. Sales Force Communications and Education with Mary Kay Inc. “Learning to have skin care and color events, selling products and sharing the opportunity with others are critical elements to our business. However, inherent in our training are soft skills such as communication, time management and customer service. As an Independent Beauty Consultant progresses along the career path, leadership plays an important role in success and is an important part of building a strong business.”

Murphy says that Arbonne also begins the training program by teaching consultants the basics before they graduate to more advanced skills. “We offer everything from basic skill-based training, like how to schedule, how to sell and how to sponsor—the fundamentals of any good network marketing company—to product knowledge to personal and professional development,” she says. Arbonne training programs are developed with input and guidance from the company’s top leaders and made available online to the company’s consultants. “We fully understand we’re working with a volunteer army here. So how do you motivate and get your people to actually want to get up and do Arbonne every day? It’s very step by step: getting people started, giving them a process and showing them how to set and reach goals.”

Obviously, direct selling professionals must also absorb tons of knowledge about the actual product or service they are selling. As part of product training, direct selling reps learn how to use, demonstrate and display their product—whether they’re selling cosmetics, home décor items, an advanced scientific wellness product, legal services or a debt management system.

Product training is particularly important at LifeVantage, a science-based nutraceutical company where distributors are selling products designed to reduce age-related symptoms on the cellular level. “Some of the benefits associated with our product do seem complex,” says Ryan Thompson, Senior Vice President of Sales and Marketing with LifeVantage. “For that reason, we offer significant training not just on the benefits of the product, but also on the science, research and development behind it.”

“We say, ‘Keller Williams is a training and coaching company that just happens to be in the business of real estate.’ ”
—Mark Willis, CEO of Keller Williams

Although the products may seem complicated, McGarry adds that LifeVantage representatives don’t need to have a degree in cellular biology. “The great thing about our company is that you don’t have to be a junior scientist to understand and explain the benefits and health-promoting capabilities of our products,” he says. “We provide training in the form of personal mentoring, monthly training calls with members of our Scientific Advisory Board, quarterly printed materials and information on the science behind our products, and by holding quarterly training meetings featuring the science that validates our products and the products we offer as well. It’s a chance for our distributors to meet the man behind the original science, Dr. Joe McCord—also our Chief Science Officer—who not only provides product training, but also offers his perspective on the latest research and developments of today.”

Keller Williams Realty also offers advanced training programs to its associates. Because each associate is already a certified REALTOR®, the company offers some exclusive personal-development opportunities. “We say, ‘Keller Williams is a training and coaching company that just happens to be in the business of real estate,’ ” explains Mark Willis, CEO of Keller Williams. He says that Keller Williams approaches training and coaching systematically and that training is focused on teaching sales associates how to become business owners.

“We see our agents as falling into three distinct communities: the mega agent, the intermediate agent and the new agent,” Willis says. “We build our curriculum and coaching for each of these different groups—moving them along the path toward becoming a mega agent if that’s the direction of their goals and vision for their career.” He adds that education has always been Keller Williams’ most powerful asset when it comes to helping agents succeed. “We have Keller Williams University (KWU), our MAPS Coaching arm and a specialized focus on technology, with award-winning products like our lead-to-close business solution eEdge.”

Out of the Classroom, Into the Streets

No matter what type of training program a direct selling company has to offer, one thing is certain: Representatives will most likely learn the most important lessons on the job. “When most people think of training, they think of something that takes place in a classroom,” says Williams with Primerica. “But the most valuable training, especially in a business like ours, is the on-the-job training—watching a successful person in action doing the business, providing the solutions directly to the client, observing and participating on almost an apprentice basis so you can develop those selling and closing skills.”

training

After all, no one is going to tell you “no” in a classroom. “A big part of learning this business, especially a sales and recruiting business, is that you’ve got to learn how to convince people to say ‘yes’ or to accept it when they say ‘no.’ And that just cannot be duplicated in a classroom,” Williams explains.

While Primerica takes an educational approach like many other direct selling companies, Williams says the company is still a sales business. “We have a low-pressure process and an educational approach, but in the end if people aren’t saying ‘yes’ and buying something, you don’t have a business—you have a nonprofit educational institution,” he adds.

The Gift That Keeps On Giving

When compared to practically any other field, there is no question that direct selling companies offer unequaled training and personal-development opportunities. The lucky individuals who join this industry gain access to a vast reservoir of training—and they stand to reap the benefits now and well into the future.

“The professional training that LegalShield delivers will help all of our associates become better at building relationships, listening to the concerns of others and problem solving,” Petrill explains. “These and so many other skills learned through direct sales can help our associates for years to come—in both their business and personal life.”

To top it off, the priceless skills direct selling professionals learn could easily transfer into other fields as well as further aspects of their lives. “In any business you need to know how to build relationships, how to invite people to change, how to follow up and how to develop and build a business,” says McGarry with LifeVantage. “The skills we teach are useable in everyday life and applicable to any business.”

Williams with Primerica agrees that the skills professionals take away from the direct selling industry will certainly open new doors for them. “Our goal is not to train people for the rest of the industry, but there is value that you take with you no matter where you go from the Primerica licensing experience,” he says, and adds that the sales skills Primerica representatives develop are absolutely invaluable. “We’re all selling all the time, and we’re always in the business of convincing others to see things our way,” Williams says. “All of those skills are universally applicable not only in business but also in life.”

“In any business you need to know how to build relationships, how to invite people to change, how to follow up and how to develop and build a business.”
—Jon McGarry, Vice President of Sales with LifeVantage

Westurland says the personal-development skills team members learn at Agel also spill over into all areas of their lives. “One of my favorite testimonials is from an individual in Ohio who built a very modest business as it relates to Agel, but he is very passionate about our products and the personal development he’s received from our company,” he says. “He owns his own business outside of Agel and has seen that business improve to three or four times what it was before his involvement with our company. He attributes this to the time management, presentation skills and overall personal-development training he’s received from Agel. When someone succeeds with us or in their life away from Agel because of the training they receive from us, it’s very gratifying and reinforces why we are involved in this great industry.”

This is precisely why economists like Pilzer believe that direct selling can open up a world of opportunities to professionals who are trapped in the vicious unemployment cycle. “I love direct selling as much for the business opportunity as for the personal growth,” Pilzer says. “If you want to give someone charity today, give them a job opportunity. Don’t give them a fish; teach them to fish.”