South Africa can easily double the number of small, medium, and micro-enterprises (SMMEs) if sufficient attention is paid to the direct selling industry, says Rajesh Parshotam, chairperson of the Direct Selling Association of South Africa (DSA).
A report by the Small Business Development Agency (SEDA) indicates that SMMEs grew by 2,5% year-on-year from the first quarter of 2019 to the same period in 2020.
The number of SMMEs, according to the SEDA report, grew from 2,55-million to 2,61-million employing just over 10-million people during the period under review.
To be noted, however, is that this growth in SMMEs was before the national lockdowns were introduced to combat the spread of the Covid-19 virus.
Parshotam says the direct selling industry alone accounts for more than 760 000 SMMEs, which are unlikely to be included in the SEDA survey.
“Our industry provides income generation and business opportunities to hundreds of thousands of people in South Africa and abroad,” says Parshotam. “Globally, direct selling accounts for more than 100-million SMMEs.”
Parshotam says the entire SMMEs development ecosystem, both in the private and public sector, has for several years ignored the contribution and impact of the direct selling industry.
A recent report from the National Youth Development Agency indicated that about 1 000 SMMEs received assistance from that agency. Parshotam says “none of those SMMEs were from the direct selling industry”.
He adds that the general perception seems to be that direct selling was a “side-kick” that people engage in to generate extra income.
“While this may very well be true for some, direct selling is also a full-time business opportunity for many people across the globe,” says Parshotam.
He believes the direct selling industry is an opportunity-in-waiting that can get our economy working again, “and quite quickly”.
Parshotam says what the direct selling industry needs is recognition by the appropriate government support structures so that it too can receive the support measures available to all other types of SMMEs.
“Given the challenging economic situation the country finds itself in at the moment, this is not the time to overlook any possible economic upliftment and income generating options,” says Parshotam.
He says the DSA, which represents around 24 direct selling businesses in South Africa, generating some R9-billion in sales annually and paying direct selling entrepreneurs around R2,4-billion in earnings annually, will continue to engage with the government.