Direct Selling Industry Grows 7.7% to Rs 18,067 Crore in Financial Year 2021: Report

New Delhi, March 31: The direct selling industry grew 7.7 per cent in the pandemic impacted FY21 to cross the Rs 18,000 crore mark for the first time, according to a report. The industry's sales stood at around Rs 18,067 crore in 2020-21, which is an increase of Rs 1,291 crore over Rs 16,776 crore in FY20, said a report released by Indian Direct Selling Association (IDSA).

"In a year dominated by the COVID-19 pandemic and comprehensive lockdowns, the Indian Direct Selling Industry has managed to emerge stronger and maintain its growth momentum. This has been achieved by constant innovation, adoption of new technology and custom driven adjustments to customer and market needs," it noted. The Annual Survey 2020-21 revealed that employment in the direct selling industry has also increased.

The total number of active direct sellers in FY21 grew 6.32 per cent to 7.9 million against 7.4 million in FY2019-20. "In terms of the gender ratio of Direct Sellers, the industry currently comprises 53 per cent of male and 47 per cent of female active Direct Sellers," as per the report.

The direct selling industry has recorded a CGAR of around 12 per cent in its revenue, growing from Rs 10,300 crore in FY2015-16 to Rs 18,067 crore in FY 2020-21. According to the report, the northern region contributed around 29 per cent of the direct selling sales in the country for 2020-21. This was followed by the eastern region with approximately 26 per cent of the direct selling sales.

"Maharashtra had the highest share of sales across the country with 12 per cent of the gross sales in 2020-21, closely followed by West Bengal contributing 11 per cent of the direct selling sales in the country," the report said.

According to the report, the growth was driven by wellness, cosmetics and personnel care segments. Wellness as a category accounted for 57.8 per cent of the total direct selling business, followed by cosmetics and personal care products at 8.2 per cent.

Moreover, smaller tier II and III cities have also shown significant growth in the direct selling industry as well. With changing times and new normals, the direct selling industry has also enhanced its focus on digital adoption. The Annual Survey Report FY2020-21 on direct selling was released on Thursday by state minister for Consumer Affairs Ashwini Kumar Choubey, IDSA said.

"By providing livelihood opportunity and skilling to almost 80 lakh Indians, the Indian Direct Selling Industry has proven that it has established itself in India's socio-economic landscape," Choubey said. The government has given policy clarity to this industry by way of the Consumer Protection (Direct Selling) Rules 2021.

"I am confident that the Consumer Protection (Direct Selling) Rules 2021 will pave the way for further growth. I am also happy to note that the DS Industry has incorporated the use of technology to conduct digital transactions, promoted self-employment and the spirit of creating start-up businesses," he said.

IDSA Chairman Rajat Banerji said: "IDSA member companies have contributed 54.2 per cent to gross industry revenues – Rs 9,800 crore in FY2020-21 - which is a substantial increase from the Rs 8,442 crore recorded in FY2019-20 - a 13.9 per cent increase year-on-year". IDSA is a self-regulatory body for the direct selling industry in India.

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