In the United Kingdom, there are presently over 425,000 direct sellers contributing £2 billion to the economy through network marketing software, MLM, or direct selling (source: DSA website). Health and fitness supplements, cosmetics, candles, Tupperware, and utility services are just a few of the many products and services offered by network marketing companies, which are now widely available in the UK and elsewhere.

human resources and business hierarchy concept

So, where did this whole thing come from?

 

Direct selling has been around for a very long time because it eliminates the middleman, the retailer. MLM as we know it now has its roots in the United States, although it’s unclear which corporation was the original network marketing organization.

 

Founded in 1886 as The California Perfume Company, Avon claims to be among the earliest. Others assert that in the 1930s, a business by the name of Wachters was marketing supplements made from marine vegetables. Amway, a distributor of consumer goods, was founded about this period as Nutrilite (then known as the California Vitamin Company) (although Amway took over Nutrilite in 1972). With respect to the introduction of a charge paid to whoever brought in the most members, Nutrilite was perhaps one of the pioneers in this area. On the other hand, the Federal Trade Commission falsely accused Amway of running an illegal pyramid system after they won an important court battle, which established Amway’s legitimacy as a legitimate business opportunity.

 

What was the process via which it developed?

 

It was during the 1980s when network marketing companies in the US reached the height of their success. The promise of financial independence and flexible working hours drew more women to multi-level marketing (MLM) companies. It was also possible for anyone, regardless of previous experience, age, or location, to start and run their own firm for very little money.

 

Because of an invasion of pyramid schemes that operated under the network marketing umbrella, the sector had a negative image and continues to have a bad reputation.

 

Founded in 1923, Kleeneze was the first company in the UK to use network marketing techniques. In 2018, it entered into administration.

 

Today’s industry

 

Products and services offered through direct selling nowadays range from the conventional face-to-face technique to online sales and house parties, as well as both. More and more social selling events are taking place via Facebook Live and Skype, according to a recent survey by 42% of distributors. Direct sellers reported monthly profits of £372.95 on average, with 63% of direct sellers working a second job in addition to their direct selling firm.

 

The Direct Selling Association UK (DSA) “works to have direct selling globally recognized and appreciated as one of the finest techniques of marketing to consumers.” It is now a highly regulated sector. There are nearly 50 industry members represented by the DSA, all of whom are required to follow a strict code of ethical conduct.