Women as Direct Sales Agents

8/8/2019 Women as Direct Sales Agents

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Restricted - Confidential Information

GSM Association 2010

All GSMA meetings are conducted in full compliance with the GSMAs anti-trust compliance policy


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Three main actor are involved in the development of a

network of women direct sales agents

Multinational corporation:

train women to become representatives

sometimes provide microfinance so that women can afford products stock at the

outset

Women self help group: Selects women with entrepreneurial potential

Provide locations for company presentations and training

Microfinance institution:

Needed when corporations do not provide microfinance lending

Needed when women need to invest in assets additional to product initial stock


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Direct selling appears to be an effective distribution channel

in emerging markets

Direct selling particularly works in emerging markets for several reasons:

it builds on traditional trading arrangements and already existing web of social ties

(i.e. relatives, friends, and neighbours)

the success of a direct seller greatly depends on her networking skills rather than

her literacy and educational levels it resonate particularly well in contexts were capital and income generating

opportunities are scarce

cost of entry and the risk of participation in a direct selling network are quite low


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Women have great potentials as direct sales agents and can

greatly benefit from being involved in such initiatives

Women have emerged as the main actors of these initiatives for several

reasons:

most products marketed through these approach (i.e. cleaning products,

cosmetics, kitchenware) are purchased and used by women

in many societies women have always played a major role in selling a wide varietyof products from handcrafts to vegetables and fruits

it is well established that investing in women is the most efficient way to improve

not only household welfare, but the social and fiscal health of nations

Womens participation in direct sales networks improves their:

income

confidence

self-esteem

autonomy


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Entrepreneurship activities can play a crucial role in the

empowerment of women in the developing world

Two factors are crucial to womens empowerment:

Resources: income, education, land, etc..

Agency: ability to control resources and make strategic choices on how to use

them in a context where this ability was previously denied

In many emerging countries women empowerment is hindered by:

barriers to access resources

restrictive socio-cultural norms and gender based discriminations that hinder

women agency ability

These initiatives encourage women to invest in resources - facilitating access

to capital and training - and give them the opportunity to learn how to make

strategic decisions on how to use them


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MNOs products can easily be distributed through this

channel

MNOs products such as SIM cards and airtime cards are:

easier to sell than other goods such as food products (not perishable)

are available and demanded by consumer regardless of the season

take up little space and do not require the seller to have access to other assets

convey a more sophisticated status and confer a more upscale reputation thanconventional form of petty trade


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Designing direct sales networks that favour women

empowerment

The way companies design their network of direct sales agents have major

impacts on:

Inclusion of poorer women

low cost of entry and facilitate access to microfinance

Potential for learning opportunities and personal development team building and financial literacy training

provide incentive to play an active role in recruiting and training new agents

Potential for women empowerment

encourage women to identify their life goals and to channel their efforts so as to

reach them give women a new view of the possibilities and opportunities before them

connects women with realities beyond their immediate context

reinforce their identity as entrepreneurs


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Poorer women should find possible to become agents

Initiatives that can favour the inclusion of poorer women include:

allow new sales agents to start with a limited stock of products

provide sales agents with a small amount of credit

facilitate access to credit from microfinance institutions

allow initial small orders and facilitate the conversion of the profits from thesesmall sales into subsequently larger orders


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Opportunities for learning and personal development should

be frequent

Initiatives that can provide learning opportunities and personal developments

include:

train women on financial literacy, negotiation and team building skills

give incentives to women to recruit and mentor new agents

provide commissions also on the sales of agents recruited and mentored by senioragents

post a credit history of the direct seller so as to enabling women to build the credit

rating necessary to start other small-scale entrepreneurial ventures


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The ultimate goal of these initiatives should be women

empowerment

Initiatives that can favour women empowerment include:

favour a stable income stream so as to provides women with some freedom from

patriarchal authority and gives them greater authority in their households

provide incentives which serve as milestone for individual achievements

give women a new view of the possibilities before them encourage women to identify their life goals, and teach them how to channel their

effort and how to plan financially to achieve them

define motivational events, inspirational materials, reward systems and mentoring

process that inspire women to realise their personal ambitions and reinforce their

identity as entrepreneurs


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Potential drawbacks must be assessed

Potential drawbacks include:

direct sellers can become squeezed between buyers and the company if payment

are delayed and are not forthcoming

direct sellers confront ubiquitous pressures to sell, recruit new sellers, and reach

sales targets

Risk of women becoming target of assaults as travel with cash/large stock of

products


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Recommendations forMNOs

Phase 1:

- Identify areas for pilots and women self help groups to partner with

- Identify retailers in nearby cities that can act as point of contact for women

agents

- MNOs can partner with women self help groups in selecting women withentrepreneurial potential

- Self help groups can train women in basic business skills and basic literacy so

as to be able to act as sales agent

- MNOs can train women so as to introduce them to the logics of tariff plan

characteristics, SIM card activation, provision of airtime, etc..- Microfinance institution would have a marginal role since the initial investment

that women do to buy Sim cards can easily be financed by MNO/self help group


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Recommendations forMNOs

Phase 2

- MNOs will provide women agents with an handset for their own use and a

certain amount of SIM cards

- Women will only need to physically have SIM cards as airtime can be sold to

end customers through apps (see Mobile prepaid business for BOP womenin the Apps challenge)

- Women can easily use mobile banking to give back to the retailers the cash

collected by customers

Further benefit forMNOs

- Generating sales will be the main task of women agents but they will also beinvaluable point of contact with BOP consumers and their insights could be

used as inputs for dedicated tariff plans and VAS


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Next steps

Define economics of the system:

Define the margin a women agents get on SIM card activation and airtime selling

Define the average income a women agent need to be in business

Define sales volume that would justify MNOs investments

Sizing the potential addressable market a women agent need to serve to be inbusiness

.....


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Women as direct sales force - Case studies

Hindustan Liver Project Shakti India

Royal Philips Electronics India Tupperware Brand Corporation India

Avon South Africa

Belcorp Latin America


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Hindustan Liver Project Shakti - India

The products:

FMCG (i.e. washing powder, toothpaste, shampoo, etc..)

The challenge:

reach the 500.000 villages with smaller populations in more remote parts of the

country, where there are millions of potential consumers but no retail distributionnetwork

The opportunity:

tapping into the number of womens self-help groups that had been springing up

around the country


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Hindustand Liver Project Shakti India

How does it work:

The company provides self-help group women with training in selling and

commercial knowledge, teaching them to become micro-entrepreneurs. Each

woman who becomes a distributor usually invests 12.500 rupees in stock at the

outset, usually borrowing from self-help groups or micro-finance banks facilitatedby HL. Each aims to have around 500 customers, mainly drawn from her village

self-help groups and from nearby villages. Most generate sales of 11.000 rupees a

months, netting a monthly profit of 850 rupees.

The results:

Project Shakti has proved to be a great success forH

L and for women in India.The projects started in a few pilot villages in Andhra Pradesh in 2000 and by 2004

had grown to over 13.000 Shakti women entrepreneurs covering 50.000 villages in

12 states, selling to 70 million customers. HL believes that its project changed

Shakti women lives in ways that are much more profound than the income they

earn selling soaps and shampoos. It has brought them self-esteem, a sense of

empowerment and a place in society.


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Royal Philips Electronics India

The product:

Lanterns and lamps that do not need neither on-grid power not kerosene

The challenge:

The majority of the regions without electricity are in rural areas and therefore not

served by existing retailing networks. Conventional distribution approach in thesearea would be too expensive and results in unaffordable products.

The opportunity:

team up with women's self-help groups contacted through the NGOs Philips works

with. The women in these self-help groups often have access to microloans. They

could therefore each purchase a small number of lamps and sell them to friendsand acquaintances typically at home demonstration parties


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Tupperware Brand Corporation India

The products:

Kitchenware and houseware

The challenge:

Educate Indian consumers on how to use western kitchenware and to the benefit it

can bring them

The opportunity:

Tupperware believes that women enjoy getting together and share their

experience. It also believes that the kitchen is the realm of women and therefore

only a woman can demonstrate how to use kitchenware products to other women


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Tupperware Brand Corporation India

How does it work:

Tupperware women sales consultants sales wares directly to consumers through

a party plan approach. They arrange social parties at their homes, or in the

homes of willing customers where they demonstrate and sell the companys

products. Results:

Since the early 1990s, the company rapidly expanded in developing markets where

women often face steep educational and cultural barriers to employment. In India

alone, the company has a sales force of more than 50.000 women. When they

started in 1996, the company often had to convince conservative husbands and inlaws to allow their wives and daughters-in law to try this job. According to Asha

Gupta, managing director for India, there is a palpable societal change that we

are engineering to empower women to become confident- by offering them

financial independence, identity, exposure, and a secure future for them and their

family.


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Avon South Africa

The products:

Cosmetics

The challenge:

Since its foundation in California, Avon relied on a network of direct sales agent

and was eager to replicate the model in emerging markets. However, theconditions founded in emerging markets forced the company to define a new way

to run its network of direct sales agent

The opportunity:

Provide an attractive business opportunity for the large number of unemployed

women in South Africa.


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Avon South Africa

How does it work:

Avon extends a small amount of credit at the outset and most women begin by

filling small orders and convert the profits from these small sales into

subsequently larger orders. Avon also allows a substantial profit margin giving an

average commission of 20 per cent of the retail price of goods. Avon also providestraining in skills including financial management and team building that can be

transferred to other context. Moreover, the company defined the Build your

dream campaign, which aims to encourage women to identify their life goals and

teaches them how to plan financially to realise them.

The results:

Research proved that womens participation in Avon network not only improves

their income but also build their confidence, self esteem and autonomy.


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The products:

Cosmetics

The challenge:

Replicate the person to person direct sales business that succeeded in developed

markets. Given the inequality of America Latina societies the only women thatwere interested in becoming direct sales agent were poorly educated and without

access to capital or business training

The opportunity:

Encourage women from low income households to become direct sales agent by

providing them an earning opportunity and offering them financial, social, andemotional support


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How does it work:

Consultants meet with their managers every three weeks to discuss business and

sales strategies. These are also opportunities for networking and creating social

bonds between consultants, where the women can share experiences and learn

from each other. Through the companys policies, beauty consultants are alsoencourage to save money and grow their business. All purchases and payments

for product sales at Belcorp are managed through bank transactions so as to

bringing women into banking as a first step to giving them tools for saving,

investing, and accessing credit.

The Results

Belcorps has 650.000 beauty consultants in Latin America, the majority of them

are from low income households.

Women as Direct Sales Agents

Documents

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