More US workers, hoping to make ends meet in the recession, have turned to direct selling, but revenues are not keeping pace with growth in the sales force.
The ranks of people selling wares out of their homes, at parties and door-to-door grew by 100,000 last year to 15.1 million in the United States, but sales dropped some 4%, according to the most recent figures available.
“We’re seeing a lot of people turning to direct selling, either to replace an income or to supplement an income,” said Amy Robinson, spokeswoman for the Direct Selling Association, the industry’s trade association based in Washington.
However, she said: “We haven’t yet see a bump in sales which we generally see.”
In economic downturns of 1990-91 and in 2001, a jump in direct sellers was followed by a jump in direct sales, she said.
But this recession resembles the mid-1980s downturn that saw a dip in direct sales, the DSA said. Figures are not yet available for 2009, when the economy remained in a slump and the number of Americans losing their jobs continued to grow.
“We anticipate we’re going to see that jump in sales either to bear out this year or in the early part of next year,” she said.
Direct sales were USD 29.6 billion last year, the DSA said, down from USD 30.8 billion in 2007 and USD 32.18 billion in 2006.
That doesn’t mean direct sales aren’t worthwhile in tough times, said Dave Gardner, a San Francisco Bay area resident who has turned to direct selling, from vitamins to legal services, when his jobs have dried up or been downsized.
“It gets you out of the house, and it gives you training on how to talk to people as well as it keeps you from being depressed about the fact that you just got laid off,” he said.
Logo from DSA