There are 2 groups of Avon Reps when it comes to offering "order incentives".
Those that offer discounts and those that offer free product.
I personally tend more towards the "free product" way of thinking and below
is the reasoning behind why.
Okay, you have a small customer base and you think that you will offer
discounts and maybe
that will bring you more customers.
It will, but you're shooting your profits in the foot.
Here's why it's smarter
to offer free products-in almost every situation.
Discount
Incentive -
(for this situation, we're asuming that all
products are at the full earnings level)
10% of for
all new customers
10 customers that spend $10 each = $100 order total
10% discount ($1 each customer) = $10
Total
to collect = $90
You have just LOST $10 in profits
Award sales towards PC - $100
Free Gift Incentive-
10 customers that spend $10 each = $100 order total
Free gift valued at $1 each per customer
(book value) = $6 (your cost at 40% earnings is $0.60 x 10 customers)
Your Order Total = $106
Total to
Collect from your customers = $100
You lose $6 in profits instead of $10 saving you $4
Award Sales towards
PC - $106
When you offer FREE GIFTS instead of a DISCOUNT .... You are getting GREATER award sales (getting you
closer to Presidents Club!)... and You collect MORE money, than you would with a discount... And instead of losing $10 in
profits.. you lose 6 dollars in profits, saving 40% of what you would lose if you offered a discount