Good and Bad about Direct Selling Guidelines

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What we like and what we don't like in Direct
Selling Guidelines 2016
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What We Like?

• 1. 30 days money back policy.
• 2. Free registration.
• 3. No minimum purchase requirement.
• 4. KYDS (Know your direct seller requirement).
• 5. 90 days to comply.
• 6. Explanation about People based and Pyramid
  Scheme prohibition.
• 7. Company to provide information to existing
  direct sellers concerning remuneration, rights
  and obligations.

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• 8. Bill and receipt.
• 9. Not provide literature/training material
  not approved by the company.
• 10. Company being responsible for monitoring and
  compliance of practices.
• 11. Complaint tracking mechanism.
• 12. Grievance redressal committee 3 officials
  from the company
• 13. The direct selling company to inform the
  consumer the procedure for returning the goods.
• 14. Any person who sells or offers to sell on
  ecommerce platform must have consent of the
  company.

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What We dont like ?

• 1. Too complex to be understood by a common
  man.
• 2. The word reasonable in the commercial
  terms (in case of 30 days money back policy).
• 3. Different terms used for describing the
  same component.
• 4. No Business Information Kit (with 30
  days)made mandatory which will encourage
  miscommunications and trouble for all (Customer,
  Direct Seller, Company and the Police), Higher
  chances of failures because of no information
  about the products, polices and the opportunity,
  Low retention rate, Unnecessary burden on
  companys infrastructure, etc.

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• 5. With no minimum efforts requirements, no
  renewal fees, etc. will ensure product based
  pyramid structure where the person joined the
  earliest would continue to earn from the sales
  happening in his marketing organization. In other
  words, Easy money.
• 6. KYDS proof requirement unclear.
• 7. Infrastructure requirement Offices in
  every state.
• 8. States asked to set up/monitor activities.
• 9. No rules against other 4 types of business
  models (only for direct selling and for the
  people based pyramid).

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• 10. Pay all dues and withholdings in a
  Reasonable manner open to interpretation.
• 11. No clarity on the word registered legal
  entity.
• 12. Mandatory orientation for Prospective
  direct sellers Unviable.
• 13. Issue proper identity documents to direct
  sellers open to interpretation.
• 14. Indian contract Act 1872 Loopholes for
  both parties to exploit.
• 15. Reasonable open to interpretation.
• 16. Satisfaction guarantee and Money back
  guarantee not researched and used.
• 17. Book of account to be maintained by direct
  seller.

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• 18. Unreasonably open to interpretation.
• 19. No explanation of Unfair trade practice.
• 20. Name of the purchaser and the seller
  provided to the consumer upon purchase.
• 21. Process, policies and contacts for
  monitoring not provided.
• 22. Does not have a list of products/services
  not to be promoted.
• 23. Does not have a list of Products to be
  promoted under specific conditions.

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• 24. Does not have clear and simple
  definitions/explanations of commonly used terms
  by 6 different types of models (which deploy the
  MLM compensation plans).
• 25. No mention of VAT on MRP to be paid by the
  company.
• 26. No mention of Service tax to be paid by
  direct sellers earning above INR 10 lac above.
• 27. Does not fill common loopholes exploited by
  6 different types of business models.

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Conclusion

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