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Published: September 26, 2024, 10:00 AM
Reporter: Park Jae-hyun
Summary in Three Lines:
- Sales, number of distributors, and commission payments in the support-based door-to-door sales sector all declined in 2023.
- Riman Korea, which ranked first in revenue in 2022, dropped to third place after its sales fell by nearly 50%.
- The total number of businesses, salespeople, and commission recipients also decreased across the industry.
(Sejong = Yonhap News) Reporter Park Jae-hyun –
Last year, both revenue and the number of salespeople and commissions paid by support-based door-to-door sales businesses declined.
Riman Korea, which held the top spot in revenue in 2022, saw its sales plummet by nearly half in 2023, dropping it to third place in the rankings.
The Korea Fair Trade Commission (KFTC) announced these findings in its 2023 Disclosure of Key Information on Support-Based Door-to-Door Sales Businesses on the 26th.
As of 2023, there were 4,521 support-based door-to-door businesses, down 19.2% from 5,594 the year before.
The number of registered salespeople also declined from 913,045 in 2022 to 832,497 in 2023 — a decrease of 8.8%.
Total industry sales and total commissions paid also fell by 27.6% and 20.1%, respectively. The industry’s overall revenue has been steadily declining since 2016.
The proportion of registered salespeople who actually received commissions also dropped, from 61.4% to 60.1% — down 1.3 percentage points.
In terms of sales, Amorepacific ranked first, followed by LG Household & Health Care, Riman Korea, and Univera.
The combined sales of these top four companies (including headquarters and affiliated agencies) totaled 1.5141 trillion KRW, a 23.1% decrease from 1.9686 trillion KRW the previous year.
Riman Korea, which had ranked No. 1 in 2022, saw its sales fall 47.0% in just one year, dropping to third place.
Support-based door-to-door sales is a type of business model that combines elements of traditional door-to-door sales and multi-level marketing (MLM). However, unlike typical MLM, commissions are only paid on the salesperson’s own performance and that of their immediate subordinates—not on those further down the line.
The KFTC stated:
“We expect that this disclosure will help consumers make more informed decisions regarding product purchases or whether to register or continue as a support-based door-to-door salesperson.”