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How Direct Selling Contributes To The Economy

Have you ever wondered what makes the world tick? Where does all the money come from? How does one business create income for so many people? Well, it is fairly simple. The simple answer to it is traction. When things start moving, they create a ripple effect and then that creates multiple ripple effects. The only thing required is a good start. Business and commerce are the two pillars on which an economy runs. Without the constant inflow and outflow of money, everybody cannot take home their share. Direct selling is a prime example of a business running smoothly in motion. By creating an opportunity for a few will eventually lead to multiple opportunities for many.

The Direct Selling Market

Direct selling eliminates the notion of the middleman which traditional retail businesses comply with. In any business, once the manufacture has a product ready, it is then supplied to distributors, then wholesalers who in turn sell to retailers. The retailers make it available to the consumers at something called the Maximum Retail Price (MRP). Direct selling businesses do away with this long list of middlemen and act as the intermediary between the manufacturer and the consumer. This increases demand and reduces costs. Further, it creates a huge B2B (business to business) network, so operating in a huge market becomes easier. Marketing in direct sales happens in 3 ways:

  • Single-Level Marketing
  • Party Plan Marketing
  • Multi-Level Marketing

Let us take a closer look at the three.

I. Single-Level Marketing

This is a method of marketing under direct sales where a direct seller focuses on creating a customer base rather than a direct selling team. The direct seller’s aim is to operate in one specific town or city and capture the market by introducing good products and selling them to customers directly and earning good feedback. Growth under single-level marketing is possible mainly through word-of-mouth communication and references. The main limitation of this is that it is only possible to operate in a small geographical location. More manpower could make single-level marketing even more effective, but it also increases costs.

II. Party Plan Marketing

The concept of group sales in direct selling works best in spreading the word about your products. The party plan marketing option requires you to host a party for like-minded individuals and invite them to try out your products among fun and fair. Contests can be held, and winners can be gifted products or trials. This is a popular method of selling household products as people can try them immediately. Direct selling has benefitted hugely from party plan marketers who boosted sales by creating a big network.

III. Multi-Level Marketing

Multi-level marketing or MLM is a growing trend in the direct selling market where direct sellers sponsor individuals to market and direct sell the products instead of hiring employees. This is a great way to increase business especially because of the low cost involved and also because of creating income opportunities for others. Interested candidates can then propagate the direct selling ideology to others in his/her network and thus the circle gets wider. This is by far the best and the most effective way of ensuring that your products reach hundreds of thousands of households in a short span of time.

Why Direct Sellers Succeed?

Because direct selling requires very little start-up capital, many people are likely to join the direct selling programme. With great determination and hard work, a direct seller can reap the benefits and make it big in a few years’ time. This is not a fairy tale scheme or a shortcut but a great method of investing your time and future to gain a good channel of income. As the network size increases and becomes more prevalent, credible with more product consumption, there is a constant flow of funds. Healthy activity of sales in every market creates the much-needed work-life balance in people’s lives and thus helps a country operate in good stead. Not only do direct sellers make great products available for the consumers, but they also bring in income channels for the unemployed, thus creating a network of beneficial business activity and good commerce.

The Future of Direct Selling in India

A joint report by KPMG and the Federation of Indian Chambers of Commerce & Industry (FICCI) estimates that the direct selling industry in India is likely to touch INR 64,500 Crore by 2025, owing to India’s steady growth in the number of direct sellers. This could potentially bring a self-employment opportunity for nearly 2 crore individuals in India, especially given the rise of the gig economy with the advent of the COVID-19 pandemic. The next 3 to 5 years are crucial to the growth of direct selling and some experts suggest that a significant upward trend is likely in the industry of direct selling in India.

India’s leading direct selling company, QNET India, has a huge network of direct sellers across the country. Men and women of different ages and origins have taken up direct selling, more so in 2020, and have benefitted from earning an income. Especially in a time where our economy is adversely affected, direct selling has been a source of proper self-employment. QNET India has a wide range of products and has been using direct selling as a successful means of doing business for quite some time now. Pay a visit to the QNET India eStore to explore the health and wellness products, beauty range and home & living products. You finally have a good place to start.

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