India is likely to become the Sweden-based direct sales player’s biggest market in the next 5 – 10 years, said its VP and head of south Asia and MD for India, Niklas Frisk, in an interview with online news portal Business Standard.
"India is the fastest growing market for us, and it is seen as the largest market in near future. The timeframe depends on the growth of other regions," the portal quoted Frisk as saying.
India goes from strength to strength
Oriflame set up its operations in India in 1995 and has been steadily growing it to become the biggest market in the Asia Pacific region, even overshadowing China.
Currently the company offers about 500 products in six categories to its customers in India through a growing band of direct sales representatives, but the company is expected to expand this offering in the future, if it continues to grow.
"By 2016, we want to reach 90 per cent of the population in India, it’s our stated goal," Frisk said back in May 2013.
Can Asia continue to buoy the company's results?
Strong results in India helped boost sales in the Asia Pacific Region from Euros 164.8m in 2012 to reach Euros 180.3 million in 2013.
The company currently operates out of more than 60 countries, and its geographical reach has focused on Southern Europe, Central and Eastern Europe, as well as Russia.
The economic downtown has been prolonged in many of the company’s leading markets, which has significantly impacted both bottom lines and revenues. In 2012 company revenues were Euros 1.49bn, while they slipped to Euro 1.40bn in 2013.
Tax investigation in Russia
Likewise, the company has also been struggling with operational hurdles relating to alleged tax avoidance in Russia.
Considering the company’s challenges of late, it’s little wonder that the company is now looking to faster expanding markets where it is not likely to be held back by economic gloom or regulatory issues.
Oriflame is due to announce its full-year 2014 results next week, but with Euro sales down 12% for the first nine months of 2014, to Euros 912.1m, the financial year looks set to be one Oriflame executives will want to forget.