E-Ze money through door-to-door selling

NEIL MURRAY has just spent two weeks in Florida and one in the Bahamas, paid out of his earnings as a Kleen-E-Ze Homecare 'executive distributor'.

It is a far cry from the door-to-door salesmen of old. Kleen-E-Ze now uses network marketing, which allows distributors like Mr Murray to build their own company of agents. And since Kleen-E-Ze now sells more than 500 products through a catalogue, agents no longer need to hold or pay for stock.

Mr Murray reckons he is making annual profits of between pounds 50,000 and pounds 60,000: rather better than his earnings in his former career as a biochemist. His commission and bonus are tied to the sales of those he has introduced to Kleen-E-Ze, who have in turn introduced others.

It is not pyramid selling, insists Nigel Swabey, the chief executive of Kleen-E-Ze Homecare, but a cascading series of bonuses which stops at the fifth person down the line.

Mr Swabey admits he has received complaints from customers in Kleen-E-Ze's heartland around Bath and Bristol of too many catalogues thudding on to doormats. Because agents are self-employed, he says, he cannot regulate every area to achieve optimum penetration. Direct selling is enjoying a revival. Members of the Direct Selling Association saw growth of 11 per cent last year, while Kleen-E-Ze Homecare grew by 50 per cent.

Kleen-E-Ze differentiates itself from its nearest competitors, Betterware and Amway, through its structure. Mr Swabey describes Amway as a buying club, where agents introduce friends but do little knocking on doors. It has 70,000 agents, against Kleen-E-Ze's 16,000. Betterware's 10,000 distributors are allocated areas and work for themselves, but cannot build up a business.

The scope for doorstep selling is enormous, Mr Swabey believes, and the stock market reflects his optimism. Shares in Kleen-E-Ze Holdings, which includes the mail order catalogue Innovations and the retailer The Leading Edge, have risen to a high this month at 168p from a low last September at 44p. Interim results are announced next week.

Betterware shares also soared to a high in April at 273p from a low last July at 110p.