In continuance with our earlier blog post, where we have seen how Direct Selling benefits individuals, especially those who have lost their livelihood during the Covid-19 pandemic or those looking for a second or residual income, to be independent. But, have you ever wondered why Direct Selling Companies, also referred to as Multilevel Marketing (MLM) Companies, exist, or what is the driving force for entrepreneurs to start an MLM company? Well, this write-up delves into how Direct Selling Companies operate and how it is beneficial for them to run and operate those companies.
Direct Selling Company – How Do They Operate?
First, let us know what a Direct Selling or Network Marketing Company is. It is a company that sells its products or services directly to consumers and without any middlemen or fixed retailers in between. To elaborate it even further, a Multilevel Marketing Company is a retail channel that global brands use to market their products and services directly to consumers. And this is done through Independent Representatives, also known as Sales Representatives. Some of the well-known Network Marketing companies in India’s market for quite some time include Amway, Modicare, Qnet, Oriflame, to name a few. Now let us come to our focus point, and know how Network Marketing companies operate.
Direct Selling companies do not hire personnel on their permanent payroll. Instead, they build a network of Independent Representatives to sell their products or services. The Independent Representatives use their contacts and other innovative social media and other online methods to sell. The Independent Representatives are known to be self-employed; they earn by way of attractive commissions on their sales.
Benefits for Direct Selling Companies
As per several reports, the Direct Selling Industry in India is set to employ more than 18 million by 2025. Industry estimates expect the Direct Selling sector to grow at a Compounded Annual Growth Rate (CAGR) of about 4.8 percent and is poised to reach Rs 15,930 crore by 2021. The Indian Direct Selling Industry is currently ranked 15 on the global stage. So, what makes business tycoons and entrepreneurs start a Direct Selling Company? Listed below are some of the benefits that Direct Selling companies have.
- Starting an MLM Company is the most effective way to enter a new market, especially when it involves showcasing unique products or services.
- Starting a Direct Selling Company does not involve high capital investment and is an effective way to capture prospects’ initial interest and attention by giving a personal touch.
- Bypassing mediators, intermediaries, and fixed retailers in distribution enable Multilevel Marketing companies to save substantial money to invest elsewhere.
- When an entrepreneur decides to start a Direct Selling company, they do not need to have any major or traditional experience.
- Direct Selling companies do not require highly educated personnel because of which they do not have to shell out hefty salaries to the back-end workforce they employ on their payroll.
- Starting a Direct Selling Company is a unique, competitive, and effective strategy that does not involve any substantial advertising costs and is mainly a social-based sales process that attracts new prospects and retains existing customers.
Wondering How to Start Your Own MLM Company?
If you are wondering how to start your Direct Selling or MLM company, let us discuss that briefly. The ignition point – initiation begins by deciding on a suitable product for your target market. Next, you need to consult an industry expert for registering your company with a proper name. Once all legalities are in place, you need to design the plan & calculations with the help of an MLM expert. Your compliance process begins by setting your MLM guidelines. Once done with that, you need to develop your MLM software, strategize your business promotion accordingly, and finally start by going online.
Network Marketing – The Future of Business
The Network Marketing Industry that has evolved over some time, the 21st century, belongs to it. It is touted as the future of business. With the Government of India backing the Direct Selling Industry via its many initiatives, there is no looking back. The Direct Selling companies were instrumental in providing livelihoods to millions who either lost their jobs or compelled to take salary cuts after the onset of the deadly Covid-19 pandemic. Whether an entrepreneur runs and operates an MLM company or individuals stepping in to collaborate with an MLM company, it is a win-win situation for both.
