Jewelry Home Parties
You love jewelry and maybe you want to start your own business. You are hesitant to open a store - too much overhead - I agree. Then you remember that jewelry home party you attended last year and think, ‘hey, I can do that!’. And chances are you can. But whether this is the right choice for you depends on your goals.
Most of the traditional home-party models such as silpada usually involve paying the host in product and the person who manages the process (the representative) a commission. If you want to try something with very low risk, then this route could make sense. Established home-party companies such as Silpada provide the advantage of a turn-key solution with all the bells and whistles such as glossy catalogues, customer service and training materials. And very importantly a brand that has deep name-recognition. A couple disadvantages of going with a large established company include:
There is an endless supply - your products while may be very nice and of good quality, may not be unique, since there are so many reps floating around.
High consumer prices - while the advantage to you in terms of your commission may seem generous at 30%, your customers will be paying high prices for the product. And as a business-person you should always concerned about providing your customers with excellent value.
If you want to maximize your income and have more control over your business, you may find that the rules you have to play by to be inhibiting, especially when you figure out you can source the same quality products for less money therefore improving your profit potential.
There are a lot of smaller home party companies out there such as SilverPeace. Some of these companies also provide you with ‘kits’ , the left-overs of which you send back when you are finished your party. In the case of SilverPeace we provide only limited support and a marketing kit for $21 (vs. $200 which is typical formany of the other home party companies). SilverPeace does NOT supply you the jewelry kit to start. But we do have a relationship with one of the best OEM sources of wholesale silver jewelry on the internet. Maybe you see where this is going. If you are in need of hand-holding and are ok with decent but limited profit potential, then stick with a large, established home-party-plan company. But if you are the kind of person who likes to be creative, you have an entrepreneurial spirit and you enjoy risk-taking, then don’t go that route - instead start your own thing and really be your own boss - build your business and be proud.
Let’s look at the numbers. Big Home Party Company X charges you $200 to register and then gives you 30% of the sale from your party. You do 5 parties @$1000/ party = $5,000 in sales. Your cut = $1500 less $200 fee = $1300 profit. If you walk away now, you made $1300. Not bad and you have no liabilities. Take the other model - do it yourself - 5 parties @ $1000/ party = $5,000 less your expenses: Wholesale Jewelry product costs (~$1800) less SilverPeace Marketing Kit ($21) = $3179. Essentially, when you source the jewelry yourself at wholesale costs you are able to take a markup of 2.5 to 3 times what you pay. So instead of making 30% on jewelry that belongs to someone else, you make a 70% profit by making the up-front investment on your own.
And the third option is of course to do it totally on your own, but if it was me, for the $21 and an established source I would go with Option 2. Both options are viable and depending on your personality and your business/ life goals either one could work for you. The bottom line is this - Having some guidance is nice, so ask youself whether you want something cookie-cutter, or something free-form, or a little of both. Whatever road you go down be sure to do your research and explore all the options. And one word of advice I always hand out is don’t rely solely on what you read on the web. Pick up the phone and call a warm-blooded human being who is the expert in their field. 90% of the time you can get your question answered a lot quicker, and well, if you cannot reach a person at a particular company that will help you, that should tell you all you need to know about who to do business with.
If you have any questions or need advice, call me at any time.