Direct Selling-Introduction-4

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Direct response home shopping is, in some respects, similar to direct selling and the next chapter compares these two channels in more detail.Ther is, however, another technological development that has given a strong impetus to the growth of all direct distribution channels; this is the information technology (IT) revolution technology and relatively ibexpensive computerized data management systems now make it possible for a business to administer economically small accounts in a way which wa previously impractical. And it is not just the ease with which even a small DSO can now store, retrieve and reproduce information on each one of thousands of predominantly part-time independent sales people.

The revolution in banking and payment systems and the growing use of credit cards both by consumers and by direct sellers in settling their own accounts with a DSOs again provides the opportunity for DSOs to deal efficiently with a multitude of small accounts. Quite apart from other changes in patterns of employment and in the sociological, demographic structure of society, which I shall be dealing with later, it is these technological developments that have a major contributory factor in the challenge now presented that have a major contributory factor in the challange now presented by DSOs to conventional retail stores.

The Growth in Direct Selling of consumer goods over the past ten years in the UK : Milliom- retail prices incl VAT
1986-£422-1988-£577-1990-£725-1992-£832-1994-£948-1996-£1040

Let me return for a moment to the question trequently asked of executives who manage DSOs, that I referred to at the beginning of this introduction. It is a question that illustrates a widespread ignorance not only of the size of the direct selling industry, but also of its recent growth. One of the reasons for this ignorance in Britain is that there are very few major UK-owned DSOs – and even fewer publicly quoted DSOs that are in a position to receive any degree of informed comment in the financial press. The world wide market for direct selling exceeds $72 billion in 1995 and, with the exception of Japan, the channel is dominated by the US multinational corporations. Even in japan, Us corporations have a major presence.

Reference: Direct Selling: Richard Berry

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