The Indian direct selling industry has reported a 12 per cent growth in FY23, reporting a sales of Rs 21,282 crore (over USD 2.5 billion), led by the wellness category and cosmetics & personal care, said a report. Besides, the total number of active sellers has also increased to 8.6 million in FY23, of which 63 per cent are male and the rest are female selling partners, according to the annual survey report released by the Indian Direct Selling Association (IDSA) on Wednesday.
Earlier, the direct selling sector was traditionally dominated by females, however, after the pandemic, this has changed and youths in the age bracket of 25 to 44 years are joining the direct selling industry in large numbers, IDSA Chairman Vivek Katoch told PTI. "In the financial year 202223 direct selling industries witnessed robust double-digit growth, marking a significant improvement. This upward trajectory reflects a promising outlook for the industry, underpinned by consistent growth over the years," said Katoch.
In FY23 more than 2 lakh new members joined the direct selling industry and statistics suggest the industry is particularly favoured among the youth and middle-aged demographic. "Over the past four years, there has been a consistent upward trend in the number of Active Direct Sellers across the country," he said.
The Indian direct-selling industry has reported a double-digit growth in FY23 as its "demonstrated resilience and growth despite challenges", though the global direct-selling industry had a marginal degrowth of 1.5 per cent in the same period at around USD 172.9 billion from the industry value of USD 175.6 billion in 2021-22. Factors such as unique product formulations, low-entry barriers, favourable demographics where the workforce is becoming increasingly mobile and flexible, and growing awareness and emphasis on health have led to growth of direct selling in India.
Like the previous year, the wellness category was the lead contributor with 73.5 per cent share, followed by cosmetics & personal care and household goods and durables, with 11.3 per cent and 7.5 per cent share respectively in FY23. The Northern region emerged as the leading contributor to the overall gross sales of direct-selling products, followed by Western and Southern regions, the report added.
The top 10 states cumulatively accounted for about 70 per cent of the Indian Direct Selling sales turnover. The states are Maharashtra, West Bengal, Uttar Pradesh, West Bengal, Bihar, Karnataka, Odisha, Haryana, Gujarat, Assam, and Delhi.
However, Katoch also added that the industry is also facing challenges at policy level in several states. "Only 10 states have constituted committees so far to monitor the direct selling industry," he said.
Some major states such as Delhi, UP, Bihar, Punjab, Haryana, Assam, and Karnataka are yet to notify. The Consumer Protection (Direct Selling) Rules as notified by the central government in December 2021, have a provision to set up a monitoring committee by state governments to supervise the activities of direct sellers and direct selling companies.
The direct selling industry has been facing headwinds amid instances of entities floating schemes to defraud people in the guise of direct selling activities. IDSA is also in dialogue with state governments for setting up similar monitoring committees and discussions are at an advanced stage with their Consumer Affairs Secretaries.
"We are hopeful that this year, most of the state governments will notify the monitoring committee," Katoch added.
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