Regulation can help direct selling grow faster: Icrier

Leading economic think-tank Icrier has called for introduction of guidelines to regulate direct selling activities, which would help the sector grow faster.

"We need to have some guidelines to regulate the direct selling sector. The domestic market is yet to grow in this space," Icrier research associate Nirupama Soundarajan said here today.

According to her, the direct selling sector should be positioned neither as retail nor wholesale segment and can be be classified as an "alternative channel". Direct selling generally refers to sale of products or services on a person-to-person basis rather than from fixed locations.

"It should be positioned as an alternative channel of distribution in line with global experiences," she said.

Icrier has been commissioned by the Indian Direct Selling Association (IDSA) to prepare a socioeconomic impact report of the direct selling industry in the country. The IDSA is an autonomous, self-regulatory body for direct selling sector and acts as an interface between the industry and policy-making bodies of the government.

The economic think-tank today held consultations with stakeholders as part of preparing the report, which is expected to be released in the next few months. "The findings from the report will bring to light the potential of this industry to the masses and overall economy," IDSA secretary general Chavi Hemanth said.

Citing a report from global consultancy Ernst & Young, she said the domestic direct selling market, excluding insurance business, was about Rs 3,330 crore in 2008-09.