Last year the retail sales of the member companies of the Lithuanian Direct Selling Association (LTPA) increased by 4.5 percent up to 38 million EUR (excl. VAT). Meanwhile, the number of people cooperating with direct sales companies fell by 2 percent and amounted to 45 thousand persons.
“Last year, direct selling companies continued successfully to increase their sales, despite the fact that the number of people cooperating with direct sales companies has slightly decreased. Record high employment and low unemployment and rising wages have reduced the attractiveness of direct sales as extra earnings or as their own small business, but this has been successfully offset by the continued digitalisation of the sector, making it easier for businesses to reach potential customers, to consult and serve its clients, ”comments Gintautas Zaleckas, Director of Lithuanian DSA and General Secretary for the Baltic States.
According to G. Zaleckas, in recent years, direct selling has become more and more often referred to as social selling, not only because of the personal contact and human connection between the seller and the customer, but also because of the increasing use of social networks[1], products demonstrations, more effective sales promotion and customer service. It is forecasted that the migration of services to the virtual space will increase even more this year due to the current situation (coronavirus pandemic and recommendations of social distance).
Comparing the Baltic countries, in 2019 the volume of direct selling in Latvia grew by 4%, and in Estonia – by 2% and amounted respectively to 26.9 and 19.9 million Euros. The number of persons cooperating with direct selling companies decreased by 2% in Latvia and by 3% in Estonia and amounted respectively to more than 34 and 24 thousand persons.
Facts and figures:
The business volumes of the members of the Baltic direct selling associations in 2019 exceeded 84.8 million. EUR, while the number of direct selling companies’ consultants exceeded 103 thousand persons.
According to the European Direct Selling Association-Seldia (Seldia), in 2018 the volume of direct sales (excluding VAT) in the EU countries amounted to more than 29.7 billion euros, and the direct selling companies provided the opportunity to earn more than 6.8 million euros people.
According to the World Federation of Direct Trade Associations (WFDSA), in 2018 direct sales (excluding VAT) amounted to almost 193 billion USD, and the number of persons cooperating with direct selling companies exceeded 118 million people.
For 85 percent of people engaged in direct sales, this is a source of additional income and as many as 88 percent the representatives involved in this business are women.
[1] According to a study conducted by IPSOS and the European Direct Selling Association-Seldia, in Lithuania as many as 59% of direct sales companies-consultants effectively use social networks in their sales.