Ghanaian youth embrace Direct Selling to earn livelihoods

Many African nations are grappling with job creation challenges with youth unemployment consistently dominating the conversation on economic planning and growth in Africa, yet the problem persists with no end in sight.

Even with stringent economic measures labeled as policy interventions, several African governments remain equivocal on the best way to stem the tide of unemployment. While the continent’s population currently stands at 1.3 billion, almost 60% of its people are aged below 25 years.

This, therefore, presupposes that more than half of the population are fairly young and active to work. But where are the Jobs? In Ghana for instance, from 1992 to date, statistics on unemployment have been grim, calling for policy interventions to drive youth entrepreneurship in the country, as opportunities dwindle in the formal sector.

Consequently, many young people have ventured into entrepreneurship, accessing various stimulus packages by the government with the hope of achieving financial subsistence. Despite this, several youth entrepreneurship ventures have not worked largely because of the challenges of startup capital, lack of financial muscle to compete, widening income inequality, and unattractive profit margins from entrepreneurial businesses.

Employment Situation in Ghana Ghana’s population increased to 30.8 million in 2021 from 24.7 million 10 years ago when the population data was the last survey, according to the Ghana 2021 census. With this growth, the unemployment rate in the country has also seen a spiral increase underlining several financial and economic factors.

More worrying is the fact that over 1.55 million people, or 13.4% of the country’s economically active population, are said to be out of work, according to the 2021 population and housing census as reported by the Ghana Statistical Service on its website. In addition, about 230,000 Ghanaians seek to enter the job market annually yet the formal economy is able to only absorb about 2% of the number. The rest, numbering about 225,000, are left to explore other means of employability that are rarely sustainable.

Overall Economic growth of the country has also taken a nosedive. The hard-hitting effect of Covid-19 has exacerbated the situation, with the country’s employment programs staggering behind its economic growth over the years. On a positive note, the conversation of entrepreneurship as a solution to sustainable income is resurfacing, with a new invigorated plan aided by direct selling.

Entrepreneurship and Direct Selling with the gig economy defining the future of work, the focus has shifted to the role of emerging high-productivity sectors like direct selling as the driving force of financial growth in solving youth unemployment.

In 2019 alone, Global direct selling revenue reached $180.5 billion and more than 119.9 million people worldwide participated in international direct sales in 2019 (WFDSA Report 2019), and 5.5 million people in Africa. According to Statista 2022, the internet penetration in Ghana stands at 53%. This has enhanced e-commerce as a large number of people can search and transact directly online through the convenience of a smartphone. With the internet acting as a conveyor of this traction, direct-selling transactions are made on e-commerce platforms with ease like recommending a product to a network of family, friends, and loved ones.

The direct selling model is structured in a unique way, different from other retail channels because of the way in which products and services are marketed to customers. Whereas traditional retail outlets or online marketplaces have the retailer dictating to the customer the service to offer, direct selling companies maintain a sales force of millions of independent workers that brings great revenue by avoiding intermediaries in the supply chain and selling products directly to consumers.

This independence has seen many people take advantage of the model to build and grow their own business and run it how they see fit.

The freedom and flexibility to set their own working hours to draw The model are not only providing financial empowerment opportunities for individuals, professionals, small business owners, and workers it is additionally reshaping how individuals can operate as entrepreneurs with as much flexible time to focus on other areas of business.
Although direct selling is yet to be a fully established business model in Ghana, there are a number of international direct selling companies with an established presence in the country. The recent increase in interest on the part of international direct selling companies like QNET has indicated a future increase in this business method.

QNET and other technologically-driven businesses are creating entrepreneurship opportunities through direct selling, providing more alluring opportunities for young people to sell and earn commissions. It is noteworthy that the market of health and wellness products is driving direct selling business in Ghana.

As more people embrace products for health wellness and beauty consciousness, these products have risen in demand. This has created a market for many youths in direct selling.

This is not only creating employment but addressing financial security, healthy lifestyles, and bringing improvements in general livelihood.

BY MICHAEL D. ABAYATEYE

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