Having gained extensive expertise in this area both by working on a day-to-day basis with independent entrepreneurs in its direct selling business and by researching attitudes and perceptions about self-employment in up to 45 countries, Amway works with opinion influencers and decision-makers to promote and support the development of a culture of entrepreneurship.
1Elena Yakymchuk: Why is Amway globally researching the conditions and attitudes promoting entrepreneurship?
2Leszek Krecielewski: Entrepreneurship of various forms, size and types is an integral part of market economies, and self-employment is inherent in Amway’s company culture. As a world leader in the direct selling industry , Amway provides a self-employment opportunity to millions of people. With the Amway Global Entrepreneurship Report (AGER), we collect and compare data from various focus topics concerning entrepreneurship, to ultimately foster discussion on entrepreneurship and raise awareness of the role entrepreneurs play in economies on a global, regional and local level.
3At the same time, one cannot ignore the influence of the social environment, prevailing mindsets and culture that affect values and social choices of potential and existing entrepreneurs, which help or refrain them from achieving their goals. Therefore, AGER provides data on peoples’ attitudes towards self-employment and entrepreneurship that is remarkable in its broadness and regularity.
4It is intended to foster sociopolitical thoughts and discussions for a profound debate about self-employment and entrepreneurship with opinion leaders, such as political, economic, scientific and societal stakeholders and other key opinion influencers. Through regular, consistent reporting, it supports decision-makers to provide a basis for social and political action to further enhance the entrepreneurial spirit.
5E.Y. What are the focus and key findings from the latest AGER?
6L.K. Entrepreneurship is more than just officially launching a business—it is about people’s attitude and motivation. People need the desire to start a business, they must be confident enough and need to have the necessary mental strength, despite a possible lack of support from their friends or family.
7AESI, which stands for the Amway Entrepreneurial Spirit Index and was first measured in 2015, is designed to track how these three parameters—Desirability, Feasibility and Stability against social pressure—reflect the overall intention of people to start their own business.
8The latest study is also focused on the internal and external factors that are beneficial or hampering for the entrepreneurial spirit in the 44 participating countries, as well as issues where people need help to start their own business, and their vision of an ideal business. This was also reflected in its title—“What Drives the Entrepreneurial Spirit”.
9In this survey, we certainly observe country- and regional-specific differences on the way to how people treat entrepreneurship in general. It appears, however, that the major gaps are found between different age groups, among females compared to males, and people with and without a University degree. And these discrepancies are “globally” common and are not connected to geographical locations.
10E.Y. Do you observe any specific trends in people’s interest to various business opportunities, and if so—what are they? What influences people’s intentions and what kind of income sources are they looking for?
11L.K. A full-time job with one employer has been considered the norm for decades, but increasingly this is changing. Micro entrepreneurs are not a new phenomenon, but they are constantly on the increase and a very large share of economically active people earn their living that way.
12This evolution or revolution of the employment relationship is being driven and accelerated by the digitization of society, which allows for new forms of intermediaries to match providers and consumers of a service, a task or a good.
13For various reasons, people are considering additional employment as their second and third jobs, working part-time after their main working hours and on weekends. The appearance and popularization of so-called platform-mediated business networks has even increased this interest and demand for self-employment.
14Having worked at a leading direct selling company for over 25 years, I am confident in saying that a business model like the Amway one pioneered the concept of the Sharing Economy decades ago. And these days, this type of business is getting even more relevant to the needs and expectations of people who are searching for new opportunities.
15Also, the Hybrid Entrepreneurship phenomenon has been gaining a lot of attention in recent years. Amway, in this perspective, is a business model which presents both a platform and an environment for part-time or full-time self-employment, and provides the possibility to earn additional income by allowing people to sell goods and services to end-consumers at a mutually convenient time and place.
16E.Y. What features has Direct Selling brought to these new economic models?
17L.K. Even a high-level look at the concepts of the Sharing Economy and Amway Business reveals some common features, which make both these models viable and highly demanded in the modern social-economic landscape.
18The purpose behind both these models is giving the opportunity for any interested person to earn income offering product and services that someone else needs. The only step he or she must take is to register as a Seller, with a direct selling company or with a respective platform (which could be digital or offline), and following this, one can start selling goods or services to end-customers.
19The level of income depends on an individual’s activeness and performance, while the rules, standards, and the business logic is created and mediated by “the owner” of the platform,—and these rules are binding and standard for all participants. In Direct Selling companies, the business logic is described in a document commonly known as the “Sales and Marketing Plan”.
20Among some other interesting features, I would like to note the person-to-person character of business activities. Direct Selling and the Sharing Economy are businesses without intermediaries. Peer-to-peer selling has been the backbone of Direct Selling distribution from the early days of this industry, so is the case with Sharing Economy organizations, since people who are selling goods or services through these online platforms interact directly with their customers. As a Direct Selling company, we are quickly adopting new technological and digital solutions, and integrate them into existing business processes.
21I think there are two distinctive features of our business model that give it an advantage. On the one hand, our entrepreneurs are pro-active in searching new clients. They do not just wait for a client to “accidentally” show up via a digital application—though this pattern also works in our industry—but are searching for potential customers by themselves. And therefore, the ratio of returning customers in Direct Selling is substantially higher than in any other Sharing Economy platform. Individual consultations with a personalized approach before selling a product or service help us retain consumers for a longer period. On the other hand, many Direct Selling companies encourage their independent distributors to build their own networks by inviting others to the business and mentoring them, and this allows an increase to their group turnover and ultimately the earned income.
22E.Y. The social role of entrepreneurship, in general, has been acknowledged frequently. Do you see any input from Hybrid Entrepreneurship, in particular?
23L.K. Business models that boost Hybrid Entrepreneurship play a substantial role in societies and this will increase further. Since these models allow a flexible schedule and offer viable opportunities for people to enter or return to the labor market, they are particularly important for socially unstable work force categories—like students and university graduates without working experience, women and especially young mothers, as well as people over 50 years old, and this is not the complete list. We are observing more and more people with different professional experience being attracted by the flexibility this business model can offer.
24There are no mandatory requirements for people who are seeking such self-employed careers. There are no requirements to possess previous working or entrepreneurial experience, professional qualifications, educational degrees, there are no age restrictions and so on. On top of this, compared to any other business spheres, Hybrid Entrepreneurship models—and I’m talking about Direct Selling here as well—require a minimum level of starting capital and incur remarkably lower risks.
25E.Y. Let’s also talk about entrepreneurs and people who want to be self-employed. What are, in your opinion, the top skills and features of successful entrepreneurs in the modern business and social environment?
26L.K. Running one’s own business requires diverse knowledge, skills and continuous development. Moreover, it is quite a personal responsibility—after all, you must be highly committed in order to succeed. Therefore, not too many people become successful entrepreneurs.
27In theory and in practice, entrepreneurs should possess a certain set of personal qualities and skills, about which millions of articles have already been written, such as: leadership, initiative, communication skills, constant self-development and professional development. Not to mention having a viable business idea and practical knowledge in finance, administration, marketing or personnel management. By the way, we did study this question in the latest AGER survey: in which areas people think they need help most to start their own business. For those people who want to become entrepreneurs but are not self-confident enough, Hybrid Entrepreneurship offers a starting solution and a chance to have a try.
28I am personally convinced, and this has been proven by a lot of examples at Amway, that the majority of entrepreneurial skills and knowledge can be gained and it is a matter of intention, training and practice. People who never had owned businesses before, have developed and are growing their direct selling business with sustainable results.
29E.Y. With all said, what key steps to support the growth of entrepreneurship would you suggest?
30L.K. It’s fair to say, for starting a business, not only personal attitudes are important. The environment where we live has an equal influence. Therefore, not only the mindset for entrepreneurship needs to be developed, but also the legal, technical and economic infrastructure.
31In AGER 2018, there are two core aspects related to starting and running one’s own business which showed the lowest level of people’s agreement globally: the first one is that “taxes are manageable” and the second one is that “rules and regulations are clear”. I think, both these factors can be influenced directly by governments. To encourage people to become entrepreneurs, rules and tax regulation should be simplified and clearly communicated.
32Here’s where educational programs may also have a positive stake. It is important not only to support entrepreneurship in education and funding programs, but to promote the concept of entrepreneurship and self-employment in general to boost acceptance within society.
33Additionally, more people should be encouraged and supported to continue their education by pursuing a university degree, since the results show that graduates deem themselves better prepared to start a business. In the meantime, a variety of affordable educational courses, training programs and business incubators could be a practical quick-win solution to close this gap.
34Strengthening entrepreneurship and self-employment contributes to economic growth and prosperity—but a joint effort within the economy, politics and science is needed to tap its full potential and to identify the obstacles and opportunities of business ownership.
35I would say, there is a need to develop a more holistic vision of the opportunities and advantages of entrepreneurship. People have to understand their personal strengths and find out about the available options to engage in their own business. It’s important to promote the values that such activities can bring both to them as individuals and to the society around them. I am convinced that this would be extremely beneficial to increase people’s entrepreneurial spirit that is so needed in modern society.
According to the Direct Selling News Global 100.