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FICCI-KPMG report sees vast scope for direct selling in TN

Our Bureau Chennai | Updated on January 15, 2018 Published on November 03, 2016

With direct selling market expected to expand exponentially in the next decade, providing employment opportunity to millions, addressing regulatory challenges and building sustainable operating environment are the need of the hour.

The Federation of Indian Chambers of Commerce and Industry (FICCI) and KPMG India report titled ‘Direct selling: Tamil Nadu’, estimates that the industry in India has the potential to reach the size of ₹64,500 crore by 2025 and is one of the fastest growing markets with CAGR of 16 per cent. The current market size is ₹7,500 crore, with North India having a market share of 29 per cent followed by the South at 25 per cent.

Key growth drivers

Home care, consumer appliances, beauty products and healthcare are the growth drivers for the industry, the report states. In the case of Tamil Nadu, the State has the market potential of ₹8,000 crore, driven by rising middle class and growth in consumer markets.

The industry has potential to provide self-employment opportunities to over 200 crores of people in Tamil Nadu alone by 2025.

No standard policy

One of the major challenges faced by the industry is the lack of standard policy that addresses issues related to direct selling. Many direct selling companies find it difficult to set up a manufacturing base in Tamil Nadu, due to the cost and time associated with obtaining clearances, the report said.

According to the report, having a standard operating procedure and enacting sector-specific legislation will create an enabling environment for direct selling industry.

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Published on November 03, 2016
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