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A PROJECT REPORT ON

DIRECT SELLING
SUBMITTED IN PARTIAL FULFILLMENT OF MASTERS DEGREE IN BUSINESS ADMINISTRATION, TILAK MAHARASHTRA UNIVERSITY, PUNE.

BY MD. JUNAID Y. DHARIWALA MBA [2008-2010]

PAI INTERNATIONAL CENTRE FOR MANAGEMENT EXCELLENCE,
MAHARASHTRA COSMOPOLITON SOCIETY, PUNE.

CERTIFICATE
This is certify that Md. Junaid Y. Dhariwala , student of PAI International Centre for Management Excellence, Maharashtra Cosmopolitan Education Society, Pune has completed his field work report on the topic of Direct Selling and has submitted the field work report in partial fulfillment of MBA of the college for the academic year 2008-20010.

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He has worked under our guidance and direction. The said report is based on bonafide information.

Project guide name

Prof. R Ganesan

Designation

Director

DECLARATION
I hereby declare that project titled DIRECT SELLING is an original piece of research work carried out by me under the guidance and supervision of Prof. R Ganesan. The information has been collected from genuine & authentic sources. The work has been submitted in partial fulfillment of the requirement of MBA to our college.

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Place:

Signature:

Date:

Name of the student:

PREFECE
Research as the name suggests itself that to be searched again what is already searched and in this we have to get some new changes of what can be edited in order to get more effective results. Here while studying the project subject and making it, we are being given chance to change what can be done in superb manner than it is and implement those suggestions. Along with that we have an opportunity to get into the corporate world with which we have to cope tomorrow and give the best of us in order to earn name and fame and money altogether.

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Thus, the main purpose of Winter Project is to get experience and project exercise along with Business Writing also. I had a privilege to study on the subject of Direct Selling, which was allotted to me to understand the difference between various types of selling and gaining more and more customers through serving in their area of need and interests.

ACKNOWLEDGEMENT
IT IS GREAT PLEASURE FOR ME TO ACKNOWLEDGE THE KIND OF HELP AND GUIDANCE RECEIVED TO ME DURING MY PROJECT WORK. I WAS FORTUNE ENOUGH TO GET SUPPORT FROM A LARGE NUMBER OF PEOPLE TO WHOM I SHALL ALWAYS REMAIN GRATEFUL. I AM VERY THANKFUL TO OUR DIRECTOR PROF. R. GANESAN FOR GIVING ME VALUABLE SUGGESTION AND ENCOURAGEMENT TO BRING OUT GOOD PROJECT. I WOULD THANK TO GOD FOR THEIR BLESSING AND MY PARENTS ALSO FOR THEIR VALUABLE SUGGESTION AND SUPPORT IN MY PROJECT REPORT.

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I WOULD ALSO LIKE TO THANK OUR FRIENDS AND THOSE WHO HAVE HELPED US DURING THIS PROJECT DIRECTLY OR INDIRECTLY.

Table Of Contents

1. 2. 3. 4.

Introduction Introduction to the Retail Industry in India Indian Direct Selling Association Executive Summary

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5. 6. 7. 8. 9.

Objectives Scope of the Project Theoretical Background Measuring Success in Direct Selling Consumer Behaviour

10. Research Methodology 11. Findings and Limitations of Project 12. Products Available to Direct Sell 13. Conclusion 14. Bibliography

Chapter-1

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INTRODUCTION

Introduction
In this competitive world, every company wants to approach directly to the customers and to retain the same through various kinds of services and products in the area of interest and use of customers in cheaper rate than any other companies. In Marketing, many streams go to sell and grab the customers like.. 1. Whole-selling :In whole sell means to sell in bulk and the product eventually reaches through manufacturer to whole sellers and they sell those goods in small amount of measure to Retailers and through retailers commodity comes to consumer to consume at the end prices of the product touch the sky to consume.

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2. Retail Selling :In Retail, every product reaches directly to consumers through chain of manufacturing to retailers and in this journey of prices of product do not increases and consumer is the beneficiary of the cheaper rate of good service. Now the world is of Retail Market, in which every category of customers like Middle income class, Low income class as well as High income class can enjoy the products consumption and services. In Retail, selling happens at various levels like a) b) c) a) Store Selling Direct Selling Non-Store Selling

Store Selling It means all the consumable goods and services available at a store to purchase at a place. b) Non-Store Selling It means no need to go to store to purchase, anything can be purchase online by Internet and accordingly payment is made online by credit cards or money transfer. c) Direct Selling In this project we are going to study in depth about Direct Selling Concept in Retail regarding how the sell is made, what sorts of customers prefer to buy the direct seling services and products, what products are available to be purchased, who the people are there to provide the services and what challenges they face in making customers, their rewards for the same and eventually limitations of the project and findings, recommendations and suggestions for the project.

Chapter-2

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INTRODUCTION TO THE RETAIL INDUSTRUY IN INDIA

Introduction to the Retail Industry in India

After 50 years of unorganized retailing and fragmented kirana stores, the Indian retail industry has finally begun to move towards modernization, systematization and consolidation. Indias billion plus population and its changing lifestyle continue to kindle the interest of major retail chains.

The retail sector in India is witnessing a huge revamping exercise as traditional markets make way for new formats such as departmental stores, hypermarkets, supermarkets and specialty

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stores. Western-style malls have begun appearing in metros and second-rung cities alike introducing the Indian consumer to a shopping experience like never before.

Rated the fifth most attractive emerging retail market, India is being seen as a potential goldmine. It has been ranked 2nd in a Global Retail Development Index of 30 developing countries drawn up by A T Kearney. The list was developed as a response to requests from retail chains facing saturated demand in most western markets.

India's vast middle class and its almost untapped retail industry are key attractions for global retail giants wanting to enter newer markets.

In the last decade or so, the much oppressed Indian consumer has undergone a sea change. Consumer Revolution in India can be studied by analyzing the different parameters of the Indian consumer.

Chapter-3

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INDIAN DIRECT SELLING ASSOCIATION

Indian Direct Selling Association

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The Indian Direct Selling Association (IDSA) is a self-regulatory and promoting body for the direct selling industry in India. The Association pursues three key objectives:

1) Protect and promote interests of the direct selling industry and its consumers. 2) Support and safeguard the character and status of the direct selling industry. 3) Assist and guide in maintaining qualitative standards in the Indian direct selling industry.

IDSA is the Indian counterpart of the Washington-based World Federation of Direct Selling Associations (WFDSA), which regulates, strengthens and promotes direct selling in over 58 countries.

Direct selling is the marketing of products or services to consumers through sales tactics including presentations, demonstrations, and phone calls. It is sometimes also considered to be a sale that does not utilize a "middle man" such as a retail outlets, distributors or brokers. This is needed where the products value needs more explanation and cannot be purchased off the shelf.

At its best, direct selling can be an opportunity for individuals to find fulfillment, express their entrepreneurial talents and gain financial independence. Direct selling involves people and is a part of direct marketing which additionally involves the use of media, print which is handled by the business.

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Chapter-4

EXECUTIVE SUMMARY

EXECUTIVE SUMMARY

Consumer satisfaction through the prompt and convenient service is the key success factor for every company in current competitive market. With a view to comprehend the competitive market scenario, the study of products and services of Direct Selling Companies have been done to ascertain and analyze customer views and preferences for the same

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through process of Brand Observation. Also, a detailed study was made to understand the performance pattern of major Direct Selling Companies. In doing so, it was possible to assess the competition in the market, hence enabling me to position ourselves more effectively and strategize on a long term as well as short term basis. During the course of this project, I was also fortunate enough to be able to study about the different types of selling and their promotional schemes carried out to beat the competition. This report contains the findings arrived after detailed analysis of the data received through observations made at the great assistance of Internet and Indirect interviews conducted with the Direct Purchasing customers form different places. Though not professionally equipped to suggest strategies to the pioneer of organized retailing in India, a sincere effort has been made to give some humble Recommendations for the organization at the end of the report which would benefit the firm in the long run.

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Chapter-5

OBJECTIVES

Objectives

Primary Objectives:

To determine a competitive analysis based on the customer convenience to purchase any product at door.

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Secondary Objectives:

Finding what the customers perception about Direct Selling products and Direct Selling Agents.

Study of current consumers response to Direct Selling products and Direct Selling Agents.

Finding for positive response to Direct selling though Convenient Approach of Customers.

Chapter-6

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SCOPE OF THE PROJECT

Scope Of The Project

The scope of project was limited to find out companies prospects and consumers responses to Direct Selling Product and Companies. The Cause of it is other fake Direct Selling Agents of other like it is said that Delhi-made products and Chinese products. Owing to this Customers do not believe to what Real Direct Selling Agent want to convince and sell.

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The Direct Selling Companies give very less Advertisement to sell the product and that is the cause it is not believed by customers. If companies give effective and attractive advertisement on Television or newspaper, its sell will be increasing. Direct Selling Agent find it difficult to survive in this competitive consumer world to sell the product owing to low response of customers, so they are also in huge amount of attrition. They should be given more incentives and effective Identity to introduce to consumers. In India people give more importance to Products Company than its monetary value so they buy any product from any trusted company and shop. So it can be a reason to minimum scope to the Direct Selling Companies.

Chapter-7

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THEORETICAL BACKGROUND

HEORETICAL BACKGROUND
RETAIL MANAGEMENT What is retailing?

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Retailing includes all the activities involved in selling goods or services directly to final consumers for their personal, nonbusiness use. A Retailer or Retail store is any business enterprise whose sell volume comes primarily from retailing. Type of Retailers: Retail organization exhibit great variety and new form keep emerging. Several classifications have been proposed. For our purposes, we will discuss store retailing, nonstore retailing, and retail organizations. Store Retailing: Consumers today can shop for goods and services in a wide variety of store. The most important retail store types, many of which are found in most countries, fall in eight categories: Specialty store Department store Supermarkets Convenience store Discount store Off price retailers Superstore Catalog showroom

Specialty store: Carry a narrow product line with a deep assortment within that line. Department store:

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Carry several product lines typically clothing, home furnishing, and household goods with each line operated as a separate department managed by specialist buyers or merchandisers. Supermarkets: Relatively large , low cost, low margin, high volume, self service operations design to serve the consumers total needs for food, laundry, and household maintenance product. Convenience store: Relatively small store that are located near residential areas, are open long hour seven days a week, and carry a limited line of high turnover convenience product. Discount store: Sell standard merchandise at lower price by accepting lower margin and selling higher volumes. Off-price Retailers: Buy at less than regular wholesale price and charge consumer less than retail. Superstores: Average 35000 square feet of selling space and have traditionally aimed at meeting consumers total needs for routinely purchase food and non food items. Catalog showrooms: Sell a broad selection of high markup, fast moving, brand name goods at discount prices.

What is retail strategy? A retail strategy is an overall plan or framework of action that guides a retailer. Without predefined and well-integrated strategy the firm may flounder and be unable to cope with the environment that surrounds it.

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Elements of a retail strategy:

1 Situation analysis It means: Defining and adhering to an organizational mission i.e. what is the firms attitude to consumers, employee, competitors, government and others. Evaluating ownership and management option i.e. whether to operate as a sole proprietorship a partnership or a corporation as well as whether to start a new business, to buy an existing business or to become a franchisee. Outlining goods/service category o be sold i.e. in what line of business should a retail firm operate? 2 Objectives: These are the goals, long run and short run, that a retailer hopes to attain. These goals are sales (including growth, stability and market share) profit (including level, return on investment and efficiency) satisfaction of public (including stock holders and consumers) and image (including customer and perception). The statement of clear objectives helps to mould a strategy and translate the company mission into action. 3 - Identification of customer: The retailer must identify the characteristics and needs of customers. The customer group that a retailer seeks to attract and satisfy is called the target market. In selecting it target market, a retailer may use one of the three techniques: selling goods and services to broad spectrum of customers, the mass market, zeroing in on one specific group, a market segment are aiming at two or more distinct consumer groups, multiple segments. 4 - Overall strategy: This strategy involves two components:

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Controllable variables that is those aspects of business that the retailer can directly affect (such as choosing a store location, management of business, merchandise management and pricing and communicating with the customer). Uncontrollable variables that is those aspect of business to which the retailer must adopt (such as customers needs, competition, technological changes, economic conditions, seasonal changes, legal restrictions). 5 - Specific activities: These actions are known as tactics and encompass a retailers daily and short term operation. They must be responsive to the uncontrollable environment (like use of research while deciding the store location, proper planning for merchandise, various promotional etc.) activities. 6 Control: In this phase a semiannual or annual review of the company should take place, with the strategy and tactics that have been developed and implemented being evaluated against the business i.e. Mission, Objectives and Target Market of the firm

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Chapter-8

MEASURING SUCCESS IN DIRECT SELLING

MEASURING SUCCESS IN DIRECT SELLING

When considering an opportunity, its natural to want to know how successful youre likely to be. Its also important to understand that the answer cant be found by looking at the number of people who earn big bucks. There are certainly direct sellers who earn six-figure incomes (and more!). However, that is not the norm, and holding all direct sellers to that standard does not create an accurate picture of success.

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One common way to measure success is through income of course a majority of people who get involved in direct selling do so, in whole or in part, because they want to earn money. However, to determine success in terms of income, one must consider do so in the context of the sellers initial goals. A person who wants to earn $200 a month, and does so, is just as successful as someone who develops their business into a six-figure income. Someone who joins with the purpose of buying products at a discount is just as successful as a stay-athome mom who joins to meet to new people. Even in a multilevel compensation system, there may be many people who do not earn commissions on a downline because they dont have a downline. Of course a business grows and evolves when new people join as sellers, but recruiting others is not essential to success unless your definition of success involves a level of earnings beyond what you will be able to earn from your own personal sales of the products and services. Focusing solely on the number of people who achieve a certain income, or on the length of time consultants remain in direct selling, is simply not an accurate way to measure success. Success must be analyzed on an individual level, based on personal goals. Direct selling critics will often focus on the small percentage of direct sellers at the top. They make it sound like its impossible to achieve that level of success, when in reality, most people have no desire to devote the time and energy necessary to be a top performer. In fact, the direct selling model has many parallels to a traditional corporate business model. In a corporate model there are a few people at the top (president, CEO, Chairman of the Board) who drive the business and motivate those below them. A large number of directors and mid-level managers execute the business operations and are developing professionally and personally. In a few cases these individuals may one day rise to the senior executive level. Finally, there is an administrative level where one generally finds younger, less experienced people who are learning the business and, depending on their career goals, may continue to climb the corporate ladder or they may leave after a relatively short period of time to pursue other goals. The salesforce structure in direct selling is actually very similar, but in reality, the potential for someone to reach the top is much higher. In a traditional business, there are a limited number of desks in the senior executive suite, but in direct selling, personal sales and the development of a productive downline will propel you to the top regardless of who else is already there.

Chapter-9

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CONSUMER BEHAVIOUR

CONSUMER BEHAVIOR:
What is consumer behavior?

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The ways in which consumers buy and use products. Typical metrics: purchase frequency, loyalty/retention, assortment/range of different products purchased from company.

The aim of marketing is to meet and satisfy target consumers needs and wants. The field of consumer behavior studies how individual, groups, services, ideas, or experience to satisfy their needs and desires.

Consumer behavior has been always of great interest to marketers. The knowledge of Consumer behavior helps the marketer to understand how consumers think, feel and select from alternatives like products, brands and the like and how the consumers are influenced by their environment, the reference groups, family, and salespersons and so on. A consumers buying behavior is influenced by cultural, social, personal and psychological factors. Most of these factors are uncontrollable and beyond the hands of marketers but they have to be considered while trying to understand the complex behavior of the consumers.

In this study, the researcher emphasizes the importance of lifestyle and its impact on the buyer behavior. The main purpose of this study is to empirically examine the association between the consumers general life styles and their consumption pattern. It uses the generalized lifestyle basis in order to investigate the relationship between life style consumption pattern and brand choice behavior .

In this study, Wells and Triggers activities, interests and opinion measure (AIO) was adopted to operationally measure a persons lifestyle pattern. The impact of the factors like the influencers, the sources of information and the product attributes on the purchase decision of the respondents was analyzed. The brand preferences exhibited by the respondents of different lifestyle was examined .

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From the study it was concluded that consumers often choose products, services and activities over other because they are associated with a certain lifestyle. The products are the buildings blocks of lifestyle, marketers should therefore, have a complete idea of these changing lifestyles so as to segment them and position their products successfully

Key Words: Lifestyle, Purchase Decision, Product Attributes, Brand Preference.

Chapter-10

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RESEARCH METHODOLOGY

RESEARCH METHODOLOGY

Market Research is defined as a systematic gathering, recording and analysis of the data concerned with an objective. This whole activity is divided in to various parts & after compilation of that we reach at certain findings, which enable us to take marketing decision.

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It involves the diagnosis of information needed and the selection of relevant and interrelated variables.

Project Title:

Direct Selling Concept in Retail

The project was conducted to determine the Consumer Behavior which helped to throw light on competitors. This will gives us an idea about the current market scenario and what exactly attracts a customer towards a store . Research Design:

A research design is the specification of method and procedure or acquiring information needed. According to my research design I have performed the following steps in the project.

Steps:

1. 2. 3. 4. 5. 6. 7.

To decide the objective of research. To determine the most suitable method of research. To determine the source of data. To decide the appropriate instrument for data collection. To determine the suitable sampling design & sample design. To conduct the field survey for data collection. To process and analyze data.

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8.

To prepare the research report.

Data source: In this study both primary as well as secondary data is collected for project.

Primary data: It is that data which is collected at fist hand either by researcher or someone else especially for the purpose of study. Here I collected the data from the target segment through questionnaire i.e. from consumers, the common people who have visited a store. Method of data collection: Survey method

Secondary data: It refers to any data which have been gathered earlier for some other purpose. Here the secondary data was collected from the following sources: Journals and magazines Internet (related websites) Text books Research type:

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I have used the descriptive method. It is a specification of method and procedures for acquiring the information needed to solve the problems. It is an overall pattern or framework of the project that stipulates what information is to be collected from which source and by what procedure.

Research Instrument:

The tool used for data collection was Structured Questionnaire which was designed keeping the objective in mind. Some direct questions were asked to respondent.

Chapter-11

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FINDINGS AND LIMITATIONS OF THE PROJECT

FINDINGS AND LIMITATIONS OF THE PROJECT

Limited response from respondent response may not reveal the accurate picture as

accurate data was not revealed by the respective respondents.

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It is the process of Time consuming to go to door of customers and take their valuable

time and convince about product.

Owing to no Advertisement customers do not trust any new-listening companies.

Respondent were not giving much to questions though we have honesty and sincerely

tried to present the facts and figures but because of some non responses errors still might have cropped level because of no interest.

They feel it cheap to response any Direct Selling Agent because of No Trust.

Chapter-12

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PRODUCTS AVAILABLE TO DIRECT SELL

Products Available to Direct Sell

o o o

NUTRITION AND WELLNESS Food Supplements Foods Miscellaneous Health & Fitness

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o o o o o o o o o

COSMETICS , Artistry / Attitude Skin Care Products HOME CARE Laundry Care Apparel Care Household Cleaners Kitchen Care Glass and Metal Care more..

o o o o o o o o o o o o o

PERSONAL CARE Hair Care Products Oral Care Body & Skin Care Family Care Male Grooming more.. CATALOGUE PRODUCTS Home Products Kitchen Appliances Children's Toys/Apparel Women's Apparel & Accessories Mens Apparel & Accessories more.. COMMERCIAL PRODUCTS Agricultural

Chapter-13

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CONCLUSION

CONCLUSION

As we know in the present scenario there is a cut-throat competition in the market. The only way to survive in the market is to attract the customers more and more and to provide the best services available in the market. As it is discussed in this project about all the factors that are

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responsible for a positive attitude of a consumer to move to a particular shopping mall or a particular department store. New competitors are entering in to the Indian market. And plus thing negative resposnse of average customers to Direct Selling Agent So consumer behavior and consumers reaction is an important factor along with satisfaction, which must be taken into consideration by every Direct Seller. Factors such as service, ambience, availability of demanded products, variety of product & services, latest trends and fashion are the main factors which directs a customer to choose a particular company for his/her shopping.

Chapter-14

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BIBLIOGRAPHY

Bibliography
Books :Marketing Channels . - Prof.Bert Rosebloom

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Advanced Marketing and Sales. - Learning Media

Newspapers :The Hindu, Business Standard

Websites :www.directselling.in www.wfdsa.org www.blonnet.com www.directselling411.com www.thehindubusinessline.com