Sales growth of the direct selling sector slowed to 4.3 per cent in 2013-14 from 12.2 per cent in the previous fiscal due to issues such as regulatory bottlenecks plaguing the industry.
According to a report by the Indian Direct Selling Association (IDSA) and the PHD Chamber of Commerce and Industry, gross sales touched Rs.7,472.2 crore during the year under review against Rs.7,164.1 crore in the previous year.
“Over the recent years, the sales growth of the industry had registered deceleration. The direct selling industry has registered a growth rate of about 4.3 per cent in 2013-14 as against the growth rate of 12.2 per cent of 2012-13, 22 per cent of 2011-12 and 24 per cent of 2009-10,” the report said.
IDSA Secretary-General Chavi Hemanth said the sector marked a significant decline in its overall growth this year due to regulatory bottlenecks.
Products related to healthcare/wellness contributed the lion’s share of 44 per cent in sales, followed by cosmetic, beauty and personal care (33 per cent), home ware and home improvement products (12 per cent) and consumer and household durables (6 per cent).
Total tax The report said total tax paid by IDSA members amounted to Rs.1,063.10 crore in 2013-14.
It members include Amway India, Oriflame, Avon Beauty Products and Tupperware India.
Major challenges Elaborating on the challenges for the sector, the report said, “The first and foremost are the activities of fly-by-night operators, who are operating under the garb of direct selling business. Another big challenge is absence of Central guidelines and regulations for the industry.”
