Prospective Direct Selling Industry
Compass, 21 April 2016
JAKARTA, KOMPAS – direct sales industry is considered quite prospective to grow further in Indonesia. It is supported by the demographic bonus population predominantly young and productive age and the development of middle class in Indonesia.
“About 70 percent of Indonesia’s population of productive age. Conditions like this are rare. Japan never experienced in 1950 and were able to use the momentum of the large number of productive age, “said Chairman of the Direct Selling Association of Indonesia (APLI) Djoko Hartanto Komara, Wednesday (20/4), in Jakarta.
Bonus demographics in Indonesia is estimated peaked in 2030 before declining. One of the challenges facing Indonesia from the demographic bonus is 60 percent of the population of productive age are not ready to work.
“In addition to the level of welfare, the direct selling industry could be one of the answers to improve human resources because no training at all levels,” said Djoko.
Referring to data from the World Federation of Direct Selling Association, the total value of the direct selling industry worldwide in 2014 amounted to 182.823 billion US dollars.The transaction value of this direct sales rose about 14 percent compared with the previous year.
However, the contribution value of the direct selling industry is not evenly distributed.The five largest contributor in the global direct selling industry is the United States, which contributes about 19 percent, China 17 percent, Japan 9 percent, South Korea 9 percent, 7 percent and Brazil.
Value of Rp 12.6 trillion
In 2014, the direct selling industry in Indonesia involves about 11.74 million direct sellers. The average annual growth of the direct selling industry in Indonesia 2011-2014 period amounted to 11.3 percent. “The value of direct selling industry in Indonesia in 2014 about Rp 12.6 trillion,” said Djoko.
Djoko said, APLI has proposed that the article on the prohibition of money game or pyramid schemes included in Act No. 7 of 2014 on Trade. This is because the pyramid scheme is often equated with the practice of direct sales. This makes direct sales penetration becomes constrained.
Head of Public Relations APLI Andam Dewi said that in Indonesia is estimated there are more than 300 companies engaged in the direct sales industry. About 200 of these companies already have a business permit direct sales (SIUPL). A total of 86 direct sales company is a member of APLI.
“Today APLI continue to socialize and educate people about the direct selling industry and the difference with the money game,” said Andam Dewi.
Cel record eight traits legal direct sales. First, the company must have a legal direct sales and marketing authorizations SIUPL products issued Agency for Food and Drug Administration, Department of Health, and others.
Second, each company must have a legal direct sales of products traded or sold. Third, business schemes emphasized on product sales and not a ranking.
Fourth, commission payments based on product sales and not the quantity of recruitment. Fifth, a member of the direct selling industry can still earn revenue from the sale of products even without recruiting.
Sixth, legal direct sales companies have a rational system of product returns. Seventh, the products traded direct sales company has a fair market value. Eighth, the product is worth more to attract purchased or consumed by the general public.