Direct selling is a very unique and alternate concept of selling products to the end-users. The direct sellers sell the products directly to the customers while eliminating the traditional distribution channel in which the products are sold in manufacturer-distributor-wholesaler-retailer-consumer chain.
The direct selling industry brings in more than 180 billion of revenue yearly and is expected to grow even further in upcoming years. This profitable industry is quite prone to frauds and thus, there are certain rules and duties enforced to prevent any such kind of activity. Here are the roles and duties of a direct seller you must know before jumping in to this market:
Duties of a direct seller
• One of the most important duties of a direct seller is to file TDS. Every direct seller has to file and deposit the TDS against the PAN number according to the rules of Income Tax Act, 1961.
• If the company does not pay the Goods and Service Tax on MRP, the direct sellers have to register for the Goods and Services tax number if the threshold limit is crossed. If the company pays for the goods purchased by the direct sellers on wholesale rates, the direct seller does not require registering the Goods and Services tax number.
• The direct sellers should ask for identity cards consisting of the name, address, contact number and important information. The essential details of the company like contact number; address of head office and validity of the card should be printed on the card.
• One of the most important duties of a direct seller is to carry an identity card provided by the company while visiting the customer’s premises. The direct seller has to reveal his/her identity and provide the customer with all the information about him/ her and also about the company & product he/she is associated with
• The direct sellers are expected to provide thorough information and demonstration about the products without being forceful. The direct sellers must not force or push the consumers to purchase any specific product
• The direct seller does not have any right to use misleading or illegal trading practices. The direct seller must not make unfulfilable promises to consumers
• The direct seller cannot force or push other direct sellers to purchase the products in large quantity
• The direct seller should refrain from offering any training or material provided by the company to any other direct seller without the permission of the company
• The direct sellers should maintain records of business dealings, purchases, important invoices, contract, termination status and important documents
• The direct sellers must have written consent from the firm for selling all the products or services offered by the company.
• It is important for every direct seller to inform the consumers about his/her rights to cancel the product, return the product in brand new condition to gain the benefit of full refunds. The direct seller must also give the information regarding complaint registration process
Here are some important things the direct seller needs to reveal:
- Details about the company
2. Thorough information about the goods /services to be offered
3. Explain the consumers about return policy for the goods
4. Provide information about billing and invoice
5. The direct sellers also must disclose the time and place for showing the samples
6. The information about return, refund and cancellation processes
7. Credit and payment terms
8. Prices of the products
9. Terms of guarantee on the product
10. After sales services and duration of the services
Rights of a direct seller
• The direct seller has the right to resign from the company without giving any reason at any point of time
• Direct sellers has the right to enter into an agreement with the company that highlights the terms and conditions of the appointment
• The direct sellers have the right to know about different compensation plans, product information and all the relevant policies before the employment
• Direct sellers have the right to engage into multiple employment opportunities unless the duties do not concern the business of the firm he/she is working with
• The direct sellers have the right to ask for 3 month notice before the company promotes alteration or addition of any new policy related to the firm
• The direct sellers have the right to ask for compensation or remuneration based on the sales of products/ services and not for the enrolment of new consultants
A lot of people might think of MLM legal in India companies and direct sellers as frauds because there were no rules or laws regulated for direct selling companies. But now, direct selling has become legal and there are companies that follow all the rules and regulations to avoid any chit or fraud. People aspiring to become direct sellers should learn about all the important rules, duties and laws to prevent any legal issues. There are certain obligations arranged for the direct sellers to make the direct selling industry legal and more reliable and all the direct sellers must know about the obligations.