Direct selling industry is expected to touch Rs 72 000 cr by 2025

India’s direct selling Industry which is expected to grow to Rs 72,000 crore by 2025, will have to be given a great thrust as it empowers women and MSMEs as well as promotes manufacturing in the country, experts suggest.
Direct selling industry is expected to touch Rs 72 000 cr by 2025

Indian direct selling Industry will have to be given a great thrust as it empowers women and MSMEs as well as promotes manufacturing in the country, Amitabh Kant, Chief Executive Officer, NITI Aayog said at a FICCI conference, DIRECT 2016.

Kant applauded the efforts of the Ministry of Consumer Affairs to come up with the guidelines to govern the direct selling industry and is hopeful for its implementation by various states. He added that an effective and time bound implementation of the guidelines would act as a growth stimulator for the budding industry.

He also urged the industry to embrace technology as the industry can deliver better and even faster once it becomes industry’s strength. He congratulated the direct selling industry for the efforts that they are putting in towards building the national economy and said that the sector is a major contributor towards the Indian growth story and promised to support the industry in addressing the hindrances and bottlenecks in due course of time. Also, he added that there is a huge opportunity that the industry raise in terms of pushing India towards the digital age.

During the conference, Madhulika P Sukul, Additional Secretary, Ministry of Consumer Affairs released FICCI‐KPMG Report, ‘The contribution of Direct Selling to Building India.’

During her Sukul, said that she delighted to see the contribution of the sector towards women empowerment and the figures of more than 60 per cent women workforce associated with the sector has been astounding. The senior bureaucrat urged the industry to join hands with the Ministry and work towards the effective implementation of the guidelines for the sector that the Ministry has come up with. She promised that MoCA would continue to work towards the welfare of the consumers with active industry support and encouragement.

Further Anshu Budhraja, GM, Amway India Enterprises presented the industry perspective and said, “The sector has immense potential in terms of the workforce that it trains and the job opportunities it generates. Budhraja said that the industry needs to work as per the Gold Standards, of which self-governance is a core concept. He thanked MoCA for coming out with the much awaited guidelines for the sector and said that the guidelines would help in adding further value to the growth path of the industry. He further added,“By 2025, the industry is expected to grow to Rs 72,000 crore from Rs 7,200 crore in 2016, providing 1.8 million self-employment opportunity.”

Praveen Khandelwal, General Secretary, CAIT, emphasised on the need of having a retail policy that will encompass the cross sectorial approach and would help in adding avenues of growth for the sector. He said that there was a need to convert the guidelines proposed for the sector into laws towards which the Government was working relentlessly. Also, Khandelwal quoted that the passing of Consumer Protection Bill in the parliament would add more flavours to the development of the sector by reducing the mischief and Ponzi operators.

He also said that a board of internal trade that would look upon the matters associated with the internal trade and retail sector should be formulated with adequate representation from all the concerned stakeholders from the industry as well as the Government. He quoted that retail, direct selling, e-commerce and SME’s are the four core pillars for the development of the national economy.

Dr. A Didar Singh, Secretary General, FICCI said on the occasion, “Indian Direct Selling Industry is an important component of the Indian economy and acknowledging this, we at FICCI through our focused task force on direct selling is working dedicatedly towards the growth of this industry and seeking regulatory clarity. FICCI is working closely with the Central and State Governments on the same. I would like to congratulate MoCA for implementing the much awaited guidelines to govern the sector. I am certain that the effective enactment of the same would facilitate the further growth of the sector and act as a growth catalyst.

“Today, we have released the FICCI‐KPMG report on the contribution of Direct Selling industry towards building the national economy and its contribution towards the flagship programmes of the Indian Government. This would be a reservoir of information on how this industry is contributing towards the development of various facets of the Indian economy”, he added.

Dr. Singh said that Industry 4.0, or Industrie 4.0, is the current trend of automation and data exchange in manufacturing technologies. It includes cyber-physical systems, the Internet of things and cloud computing. Industry 4.0 creates what has been called a ‘smart factory’ and urged the industry leaders to adhere to same. Dr. Singh also added that the bussing direct selling industry is exceptionally gender friendly and has been a crucial part of women empowerment.

Direct selling, one of the oldest and traditional forms of selling, is today a successful industry operating in over 100 countries, with a market size of US$180 billion. In India, the market was estimated at Rs 75 billion (2013‐14), and forms around 0.4 percent of the total retail sales in the country.
The event witnessed intense panel discussions on the topics ‘Way Forward Post Direct Selling Guidelines’ and ‘Direct Selling Contribution in Skilling, Women Entrepreneurship & As Food Distributors’ which comprised of representation from wide array of concerned stakeholders including the Government and the industry. 

The panels suggested an effective implementation of the guidelines by the states in a time bound manner would yield wonders for the sector and would be an asset to its growth trajectory. Also, the sessions highlighted how the direct selling has evolved as a core pillar of the Skill India campaign and trains significant amount of workforce and makes them job ready. Also, the contribution of the sector towards the empowerment of women has been significant and the phenomenal number of 62 per cent women workforce involved in the sector. 

This year’s KPMG report takes a look at how the Direct Selling industry has positively contributed to several flagship schemes launched by the Government of India in the past 2 years, namely;

Skill India: The Skill India scheme seeks to provide the institutional capacity to train a minimum of 400 million people by 2022. The Direct Selling industry annually trains over 5 million people in marketing and communication skills, personality development and leadership skills.

Make in India: Many Direct Selling companies now make in India. Some rely on MSMEs for manufacturing their products, investing in and providing the right equipment and machines to the MSMEs for production. Driven by these initiatives, several MSMEs have now developed capabilities to cater to the needs of other MNCs and have commenced supplying to them, in the process promoting the Make in India initiative.

Women Empowerment: Due to the dominance of women centric products offered under Direct Selling, the industry provides self-employment opportunities to a large number of women. In 2015 alone it has provided self-employment to over 3 million female distributors.

Startup India: Direct Selling entities are now catering to global FMCG clients. Direct Selling has also promoted startups in avenues such as transportation and logistics, trainings, app development, among various others.  

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