In order to keep income trickling in, companies the likes of Avon, Mary Kay, and Tupperware are seeing a flux of salespeople — including professionals forced to take a second job thanks to the recession.
Becke Alexander, the sales manager for Avon, noted that she hears from laid-off bankers and stay-at-home moms every week, but the company is seeing a recent boon from “gainfully employed people worried how long they’ll stay that way.” In fact, Alexander said, “There are no hobby seekers coming in here. It’s people with a legitimate need.” This pop in makeup peddlers stems directly from the current economic crisis, but not just from unemployment. A common complaint is that bonuses have disappeared, as have hours, which have forced people to turn to direct sales to make up some cash.
This increase in direct sales representatives has happened before, with the 1990 recession leading to an 8% increase in Americans participating in such sales to 5.1 million. During the next major recession (2001), the direct sales work force increased to 12.2 million. In 2007, the estimated number of Americans involved in direct sales increased to 15 million — figures for 2008 are not available yet.
In 2007, roughly 58% of the people becoming sales reps were taking the job as a source of secondary income (these statistics are from the Direct Selling Association). According to Larry Chonko, a business ethics professor at the University of Texas at Arlington, stronger economies lead to direct sales jobs taken to get money for leisure spending. Chonko stated, “Times are tough as we know and there is an absolute need for extra income … Direct sales is not recession-proof, but it is the kind of business that even in a recession you can make success of it. And if you create a solid foundation now, then just wait until the economy comes out of the down cycle and goes into an up cycle.”
Logo from Avon