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Key Strategies for Direct Selling Companies to Go Global

As direct sales businesses achieve immense growth, they gradually try to expand it into international markets. Following the same strategy used in home country to other countries, there may be a chance that you overlook some situations and loss the existing customers, distributors and even credibility in the expanding market. Through sprawl impact metrics, a business can know the effects of their overexpansion. So having a structured a solid international expansion plan not with sprawl but with focus is needed for a direct selling business.

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Key Strategies for Direct Selling Companies to Go Global

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  1. Understanding Cross-Border Markets in Direct Selling

  2. Introduction • As the direct sales business grows, they start to expand their business to international markets. • It is essential to know the effects of overexpansions through Sprawl impact metrics. • Companies should structurea solid international expansion plan of the business not with sprawl but with focus.

  3. Sprawl and Focus-Differences

  4. Four types of markets Beachhead twins: They are know as twin markets which is similar to the home country which has similar product expectations, legal structure, payment systems, and logistics. 90% of the processes should be kept similar to the home country. Community-powered markets: These are the cross-country markets where you have already existing customers. The companies should ensure to build their community with attractive offers and bundles.

  5. Tech-savvy markets: Here the customers and distributors will be well reliant on technology and online platforms. The direct sales companies should make sure they localize payment methods, logistics, and customer support system since e-wallet and e-commerce are highly used. Complex markets: Here the market will have high potential growth, but also the risks and challenges for the operations will also be high. Companies should be doing a thorough research and have a developmental plan.

  6. Setting the “Expected-to ROI” Expected-to ROI = (Expected Contribution in dollars × Survival curve) − (Run-rate OpEx + One-time setup) ________________________________________________________ (One-time setup + Working capital step-up)

  7. There are smell tests that help the companies to identify the warnings before the occurrence of errors. Compensation exceptions: No matter what, direct sales companies should not change their compensation structure for distributor requests or single country preferences. Permanently excepting rules will leads to affect the brand credibility in the existing market.  Pay cycle frequency: Distributors should be payed at a correct frequency that does not affect the cash health. It is because returns and chargebacks can give company a loss. Reverse logistics: Logistics expenses can be increased by customer returns, exchanges, and in-transit defects. For some cases, returns may be applied through email which can cause customer frustration. By using prepaid return labels, partnership with local logistics services, these problem can be solved. 

  8. Claims and content: With distributors expanded globally, product and income claims can be arised. Companies should bring content related issues under a centralized “green-copy” asset library that should be approved by all the marketers.  Data and privacy: Different countries have different laws. Direct sales companies should be aware of the laws of each country and they should be well know about where their customer data goes.  Support hours and languages: Direct sales companies must have different time zones or an AI-powered chatbot for their global support where they handle multiple languages and time zones. 

  9. Sequencing your international expansion • Product road map for international expansion as waves.  • Wave 1: Focus on beachheads markets 2 or 4 • Wave 2: Mix of one community-driven market and one tech-savvy market. • Wave 3: Know one complex market with investment decisions based purely on contribution and not assumptions.

  10. A 90-day plan to global expansion • Days 0-30: Within the first month, analyze and study the market, finalize the expansion scorecard, get risk approvals from finance team, set compensation rules and product list. Give distributors the proper training materials. • Days 31-60: Take this time to test scenarios. Monitor how the distributors and customers onboard digitally or physically and take a review every week. • Days 61-90: Take this time to take effective and clear decisions. If your goals you set have met, you can no worry and expand your market into the new cities.

  11. READ MORE:www.epixelmlmsoftware.com/blog/cross-border-expansion-strategy

  12. Epixel MLM Software www.epixelmlmsoftware.com Thankyou

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