2020 has paved the way for new reforms as far as Direct Selling is concerned. Independent entrepreneurs are now capitalizing on direct selling opportunities for a secondary source of income. Like any other form of marketing, in order work as a direct marketer, it is necessary to follow a set of guidelines devised by the Department of Consumer Affairs.
These guidelines have to be adhered to by direct selling organizations pertaining to legal norms. For instance, any network marketing company, before commencing their operations should legally register their business entity under national laws. Also, clear statements involving the price of products, replacements, delivery of goods/services and post grievance handling should be documented.
Conduct Guidelines for Direct Selling Companies in India
A code of conduct is essential for direct selling organization in order to practice and ethical way of interacting with potential customers. Employing a standard code of conduct which is directed towards customer protection enhaces brand awareness and goodwill. Below mentioned are some of the guidelines that have to be followed by direct selling companies in order to stay clear of legal complexities and complaints from potential customers.
- Website Maintenance: It is of utmost importance that direct selling organizations maintain a website that entails all goods and services provided. A register called “Ledger of direct sellers” has to be managed that involves details of direct sellers and distributors under the main brand.
- Record of Identification Proofs: Details regarding identification proofs (Aadhaar card, PAN Card) of direct sellers has to be cordially registered and updated regularly without fail.
- Details of Individual Products and Services: Another important aspect to be considered is to furnish all details pertaining to products and services by direct sellers. The terms of contract, direct seller details and price specifications should also be maintained and recorded.
- Authorization by Direct Selling Organizations: It is important that direct sellers identify themselves while on the field. It is mandatory that individual identity cards are provided to direct sellers by companies who network with them. This holds good for potential distributors as well.
- Contract Essentials: Contract between direct selling companies and sellers should be explicit and documented. For example, product details, quality certificates, contract information with distributors, compensation plan and grievance addressal should be enclosed manually. Direct selling corporations should periodically monitor the purchase value of individual direct sellers to forecast the trend in the future. If the value threshold crosses VAT, the organization should relay communication to direct sellers to pay the same.
Policies to Refrain from in Direct Selling/Marketing
Along with adhering to legal norms before finalizing contract agreements, direct selling companies should refrain from illegal or unlawful practices. For instance, using misleading examples and recruiting using unlawful methods is strictly prohibited. Providing benefits to people in order to employ them is strictly against the norm stated by Department of Consumer Affairs.
Similarly, demanding renewal or participation fees from direct sellers or providing them perks in order become a member is a strict violation of rules. Offering details about non-members that cannot be validated for authenticity will not be tolerated by any stretch of imagination.
Improved and Inclusive Customer Interactions
Interactions between direct sellers/distributors and customers should be transparent and inclusive. While visiting any customer, the seller should identify himself using his ID card provided by the company in charge. Also, direct sellers should schedule appointments in order to meet customers in person.
Some of the items that need to be discussed with the customer comprise of product prices, terms of payment, positive/negative feedback, after sales service, grievance handling and credit terms. Providing incorrect information about any product or service is considered immoral. Direct sellers should in fact offer accurate guidance and demonstrate the product to its truest potential. It is imperative that direct selling organizations frame rules that promote an ethical code of conduct. QNET, a global direct selling enterprise believes in protecting the interest of individual customers and has zero tolerance towards practices that defy a genuine code of selling.
To conclude, these set of guidelines promote the credibility of direct selling as a concept. Considering the current and future market trends pertaining to network marketing, businesses are sure to grow and prosper multi fold.
