India is among one of the "priority markets" for the direct selling Swedish beauty brand Oriflame, where it expects to continue its double-digit growth over the next 3-5 years, a top company official has said. The company which sells cosmetic and wellness products in India also expects a double-digit growth in its sales force, adding more direct sellers in the coming years.
Amid the COVID-19 pandemic, Oriflame has witnessed an upswing in the wellness products business, contributing to around 20 per cent of its India business from the earlier 4 per cent, and expects this trend to continue with some minor corrections. "We have an expectation to continue the double-digit growth over next 3-5 years and I do not see it as a huge challenge," Frederic Widell, Vice President & Head of South Asia & MD, Oriflame India, told PTI.
The company will continue to grow here for the next decades because of the growing population and would continue to invest in India and build the business, he added. "One of the priority markets for Oriflame is India," he said. Widell said though India's growth slowed down in the last two years of the pandemic, his company managed to make sure that profitability is increased.
When asked about the ranking of the Indian market in Oriflame's global business, he said: "It's number one or two." "It depends. It is between India and China. Both the markets are neck to neck and are of the almost same size," Widell said. Besides Indonesia and Turkey, Mexico and Poland are the other leading markets for Oriflame globally. Oriflame Holding AG's net sales for 2021 were 1,016.5 million euro (over Rs 8,400 crore).
Widell refused to share the revenue of the Indian entity, but said the company is having a "very solid growth" in the country. Oriflame had entered India in 1995 and was among the first direct selling firms here. "We are here for the last 26 years and we are very happy with the progression of our business here," he said, adding, "now we have a good amount of experience, understand the country and have relevant products." At present, 95 per cent of sales of Oriflame in India comes from online platforms through the app and websites, and because of this now the company has decided to close many of its offices in the country. The company has offices in selected metro cities only.
"Instead of paying that money to landlords, we are now investing that money on digital tools and product development. We use to have 20 offices and now we have only five," he said. Oriflame has nearly 3 lakh direct sellers working with the company, which helps to drive the traffic towards the website of the company. Around 80 per cent of them are female.
"Many of these people (direct sellers) order from the website and deliver to customers or order for the customers. Every activity goes through the direct seller," he said, adding that there is always a brand partner involved in generating a customer.
Oriflame has two manufacturing plants in the country -- Noida and Roorkee -- and 80 per cent of their production is for the domestic market. The rest 20 per cent is exported to other markets of the Swedish beauty brand.
Widell also welcomed the government's move to notify the Consumer Protection (Direct Selling) Rules, 2021 which bans promoting pyramid and money circulation schemes in the sector. "This is good for the industry," he said, adding that there is clarity for the sector and legitimacy has been extended to the direct selling industry. According to Widell, now many young people are opting for direct selling as their career as the sector provides work flexibility.