Global Direct Selling Industry Tamuna Gabilaia Executive Director April 9, 2015 Paris, France

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1 Global Direct Selling Industry Tamuna Gabilaia Executive Director April 9, 2015 Paris, France Month/Year

2 WFDSA and the Direct Selling Community Worldwide Founded in 1978, based in Washington (USA) 60 National Direct Selling Associations and one regional Federation Governing mechanism CEO Council Doing business in 170+ countries Strategic Objectives Direct selling image Ethics Processes and structures of WFDSA and DSAs Integration and alignment of companies

3 WFDSA Initiatives Socio-Economic Impact Studies Corporate Social Responsibility/Philanthropy Surveys Global Women s Economic Empowerment Initiative Global Code of Ethics Initiative Various consumer/academic/government initiatives and programs Media Outreach/Public Affairs

4 Socio-Economic Impact Studies Ernst&Young, IPSOS Mori, other external third partners Since 2004 WFDSA 27 socio-economic impact studies: Brazil, Canada, Japan, Korea, Mexico, Russia, Taiwan, the US (2005) Czech Republic, France, Finland, Germany, Poland, Italy, Turkey, UK (2007) South Africa, Thailand (2008) Colombia, India (2009) Canada, Chile (2010) Brazil and Ecuador (2011). Peru (2012) Australia, New Zealand, Guatemala (2013) Colombia (2014) China (2015 in progress)

5 3 Year Compound Annual Growth Rate is 6.8% CAGR [ ] 6.8%

6 Asia is the largest region for direct sales Sales Share by Region

7 Sales increased in all regions in 2013

8 The TOP 23 countries of the world account for 93% of global retail sales TOP % >75% >85% 93%

9 Entrepreneurship Global View 70% have positive view towards entrepreneurship 36% can imagine becoming self-employed Big gap between actual entrepreneurs and those seeing themselves becoming entrepreneurs Independence key driver vs. income Starting business out of necessity rather than due to opportunity Fear of failure strong obstacle (70%) social, psychological, financial (41%) Universities to play a big role in entrepreneurship education Access to finance most important facilitator (42%), reduction in bureaucracy (29%) Source: Amway Global Entrepreneurship Report 9

10 Entrepreneurship Global View Positive view on entrepreneurship Denmark (89%), Finland (87%), Australia (84%) Europe positive view Scandinavia (87-89%), Hungary (53%), Austria, Germany (57%) Europe less positive view Spain (7%), Portugal (6%), Italy, France, Switzerland (5%), Greece (3%) Large gap in view between those with university degree vs. without the degree Overall view on entrepreneurship man vs. women 72% vs. 68% Source: Amway Global Entrepreneurship Report 10

11 Entrepreneurship Global View Established Business Activity (3.5 years and older): More people starting new business than running mature one TEA Female Established Female Source: Global Entrepreneurship Monitor 11

12 Entrepreneurship Global View Exit from Business: Female Male Source: Global Entrepreneurship Monitor 12

13 Women s Entrepreneurship Global View Capability Perceptions for female and male population (%) Female Male Source: Global Entrepreneurship Monitor 13

14 Entrepreneurship Global View Female and Male Entrepreneurs with Innovative Products/Services Source: Global Entrepreneurship Monitor 14

15 Entrepreneurship Global View Intentions vs. actions Difficulties advancing from one phase to another One-women operations Staying within one s comfort level Low rates of internationalization Access to finance Young entrepreneurs future Setting goals/objectives 15

16 Global Academic Initiatives Poland Student Enterprise Assistance Program (PWPS) Include Direct Selling into Academic Curriculum Launched in 2005 Two-day sessions focused on entrepreneurship, microenterprises, direct selling, business development and managerial skills 2-3 hour interactive workshops conducted by professional coaches/trainers Q&A after each session focused on direct selling, other related topics presented during the session Handouts, leaflets, brochures, presentations distributed Panelists from government, direct selling industry, consumer organizations, academics Website focusing on small business opportunities (case studies, legal info, etc)

17 Program Description The program deliverable is to: Global Academic Initiatives South Africa Effectively contribute to the practical sales, entrepreneurial and life skills development of students studying at Universities in South Africa Enable students to enjoy a positive direct selling experience whilst also meeting their sales targets Teach students to build a small direct selling business that can continue to grow and generate income on completion of their studies Provide practical experience that can assist in increasing students employability in the formal sector on completion of their studies The program is aligned with the WIL (Work Integrated Learning) requirements, as set by the SA Department of Education to provide practical experience for 3-year Diploma students (as opposed to those studying for 3 or 4 year degrees) The subjects with which the program is aligned: Personal Selling, Sales Management, Entrepreneurship The Diplomas with which the program is aligned: Marketing Management, Retail Business Management, Sports Management, Entrepreneurship, Small Business; and a one-year Certificate in Marketing and Sales The program is included in the Faculty Regulations, as approved by the Faculty Board, and is outlined in the Student Study Guide

18 Global Academic Initiatives South Africa The program runs alongside the Academic Year starting in February/March and ending in October/November. Program orientation is given to students in February/March Students select a participating DSA company at an Expo in February/March they are only allowed to sell for one company for the duration of the program Students details and company choice are uploaded to a DSA Database Management System Thereafter, as per the Curriculum Timetable, DSA companies go to campus once weekly for an hour to: train students (business skills, product knowledge), answer queries, deliver products All business transactions are done on campus Personal Selling/Entrepreneurship students have to sell products to reach a sales target the sales target equals 50% towards their practical sales module for sales over their sales target, they can work towards a distinction in the subject Sales Management students, in addition to reaching a personal sales target, have a further sales target for downline sales and they have to recruit a minimum of 3 people to their downline ll sales are uploaded to the database by the DSA companies students use print-outs from the database to submit as proof of sales; the DSA is the overall administrator of the database Students who do not achieve their sales target fail the practical subject and have to repeat the subject the following year

19 Global Academic Initiatives South Africa WHEN IT STARTED 2002 pilot project concept, design, development and implementation of DSA-UJ Africa Development Plan at University of Johannesburg (UJ), official full-year launch in 2003, now in its 11 th year 2004 concept, design, development and implementation of an Integrated Internet Database Management System, a real-time Internet-based platform that enables project administrators, DSA companies and students to track project-sales-to-date, and to administratively manage the project 2007 launch of programme at Durban University of Technology (DUT), now it its 7 th year 2008/ trial implementation at Walter Sisulu University (WSU), East London (in discussion with new management to restructure the program to suit demographic environment of the Eastern Cape) 2010/2011 trial implementation at Tshwane University of Technology (TUT) Pretoria and Nelspruit campus. This will launch again in 2014, as a 2 nd year subject (currently reviewing the curriculum) overview of the direct selling industry in prescribed marketing text book: Principles of Marketing Global and Southern African Perspectives, Kotler, Armstrong, Tait second prescribed text book published with information on direct selling, the DSA, DSA member companies and industry case studies Personal Selling, CH van Heerden, A Drotsky (Juta) Dr Marius Wait, Deputy Head of Department, University of Johannesburg - completed his Doctorate based on findings drawn from the DSA-UJ Africa Development Plan

20 From Students: Global Academic Initiatives South Africa The DSA has opened a door of unlimited opportunity and income for me. The customers I sold to in my first year are still my customers today. I cannot thank the DSA enough for this opportunity of a lifetime. The DSA project was a very educating and fun experience. My experience on the DSA project has been an exciting and great learning experience. This opportunity has provided work experience for students, references, skills and great rebate earnings. What an experience I had. It taught me a lot about customers how to approach them, listening to them, giving them what they expect from me as a sales person. DSA has taught me a lot and I enjoyed selling directly to customers. From 41% in my 1 st year Personal Selling to an improved 91% in my 2 nd year, I d say that the DSA project has taught me a lot! One of the many benefits I got from this experience was not having to wait until I finish university to already have a category of experience on my CV I got it after 2-years!

21 Global Academic Initiatives France Direct Selling world s leading provider of basic business training and entrepreneurship opportunities France World s 8 th largest direct selling market French DSA An exemplary first Platinum level DSA within WFDSA membership First academic degree on direct selling in Europe Hands on practical training

22 Thank you! Facebook.com/WorldFedDsa Twitter.com/WorldFed_Dsas Wfdsablob.org

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