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India’s direct selling sector hits Rs 18K cr milestone in FY21

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In the pandemic-affected fiscal year of FY21, India’s direct selling industry gained 7.7 percent. Maharashtra had the greatest share of direct selling sales, in 2020-21.

According to a research provided by the Indian Direct Selling Association, the direct selling business gained 7.7 percent in the pandemic-affected FY21 to reach the Rs 18,000 crore mark for the first time. The industry’s sales will be about Rs 18,067 crore in 2020-21, an increase of Rs 1,291 crore above Rs 16,776 crore in FY20 (IDSA).

According to it, “in a year marked by the COVID-19 outbreak and widespread lockdowns, the Indian Direct Selling Industry emerged stronger and maintained its development pace. This has been accomplished by continuous innovation, the adoption of new technologies, and tailor-made adaptations to client and market needs.”

According to the Annual Survey 2020-21, employment in the direct selling industry has also increased.

In FY21, the total number of active direct sellers increased by 6.32 percent to 7.9 million, up from 7.4 million in FY2019-20.

According to the survey, “in terms of the gender ratio of Direct Sellers, the industry now contains 53% of male and 47% of female active Direct Sellers.”

The direct selling industry’s revenue has grown at a CGAR of roughly 12%, rising from Rs 10,300 crore in FY2015-16 to Rs 18,067 crore in FY2020-21.

According to the survey, the northern area produced approximately 29% of the country’s direct selling sales in 2020-21.  This was followed by the eastern region, which accounted for around 26% of direct selling sales.

“Maharashtra had the biggest share of sales across the country with 12% of gross sales in 2020-21, closely followed by West Bengal, which contributed 11% of direct selling sales in the country,” according to the report.

According to the research, the health, cosmetics, and personnel care areas drove the growth.

Wellness accounted for 57.8 percent of total direct selling business, followed by cosmetics and personal care goods, which accounted for 8.2 percent.

Furthermore, smaller tier II and III cities have seen significant expansion in the direct selling industry.  With the passage of time and the establishment of new norms, the direct selling business has increased its emphasis on digital adoption.

According to IDSA, state minister for Consumer Affairs Ashwini Kumar Choubey issued the Annual Survey Report FY2020-21 on direct selling on Thursday.

“The Indian Direct Selling Industry has demonstrated that it has established itself in India’s socio-economic environment by offering livelihood opportunity and skilling to almost 80 lakh Indians,” Choubey added.

The Consumer Protection (Direct Selling) Rules 2021 have provided policy clarification to this industry.

“I am confident that the Consumer Protection (Direct Selling) Rules 2021 will pave the path for even further expansion. I am particularly pleased to notice that the DS Industry has included the use of technology to conduct digital transactions, as well as promoted self-employment and the spirit of starting new firms,” he stated.

Rajat Banerji, Chairman, IDSA, India’s self-regulatory body for the direct selling business, stated,  “IDSA member businesses have contributed 54.2 percent to gross industry revenues – Rs 9,800 crore in FY2020-21 – which is a significant rise from the Rs 8,442 crore recorded in FY2019-20 – a 13.9% increase year on year.”

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