A STUDY ON FACTORS AFFECTING THE SALE OF AMWAY PRODUCTS. Ms. V.Chitra Head, Department of Commerce (Honours),

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1 A STUDY ON FACTORS AFFECTING THE SALE OF AMWAY PRODUCTS Ms. V.Chitra Head, Department of Commerce (Honours), Shri. Shankarlal Sundarbai Shasun Jain College for Women Anitha Elizabeth.P III B.Com, Department of Commerce (Honours), Shri. Shankarlal Sundarbai Shasun Jain College for Women 1.1 Introduction Marketing is the process of creating or reorganizing an organization to be successful in selling a product or service that people not only desire, but are willing to buy. Therefore good marketing must be able to create a proposition or set of benefits for the end consumer. Amway is a direct selling company that uses network marketing to sell a variety of products and mostly the products are based on health, beauty and home care products. Amway India products are manufactured in the country through third party contract manufacturers. Amway sells its widely acclaimed and recognized products only through authorized Distributors also known as Amway Direct Sellers.. At present the Amway Product market is floated by numerous brands. Amway distributors sell products to consumers through in-person meetings, catalog marketing material and online store portals. Distributors may also choose to sponsor other independent distributors in a multilevel marketing business model. Recruiting other independent distributors can result in monthly monetary incentives, depending on how well the sales group performs. Distributors play an important part in introducing new products to customers. New products are often successful if they provide better solutions to consumers problems and needs. An effective solution is one which makes the consumer feel that the product is better than anything else available on the market. Income is generated by a distributor through the retailing of goods to consumers. Retail margins (mark-ups) on the basic wholesale price represent income to the selling distributor.

2 1.2 Statement of Problem The company introduced the amway product during the year 1959, the sale of the product was higher, but for the past five years the usage of amway product has been reduced. The aim of this study is to know what are the factors affecting the sale of amway product and the reasons for not using the amway products by the customer. 1.3 Significance of Study The findings of the study will help the company to know what are the reasons for not using the amway products by the customers and to know the factors affecting the sale volume of the amway products. The finding of the study will help the amway company to take up initiative to make the customer to use the products and to increase the sale volume. 1.4 Objectives of the study To study the customer preference towards amway products. To analyze the factors affecting the purchase of amway product. 1.5 Hypothesis of the study H01: There is no significant relationship between marital status and the factors affecting the purchase of amway products. H02: There is no significant difference between income and customer satisfaction towards amway products. 1.6 Scope of the Study The success and failure of a product of a company is purely based on customer satisfaction. The scope of the study is to find the expectations and the level of satisfaction of the customer and the factor affecting the customer and the purchase of amway products.

3 1.7 Research Methodology Sources of Data The present study is based both on primary data and secondary data. Structured questionnaire were distributed to the people of Chennai to collect the primary data. Articles, Journals, Magazines and various forms of internet have been utilized Sampling design and Size The total number of questionnaires distributed were 120 out of which 109 questionnaire were filled and returned by the respondents. The completed questionnaire is further checked for completeness and accuracy and only 100 completed questionnaires in all respects were taken for the study Statistical tools and Techniques In this study, the researcher has adopted percentage analysis and statistical tool like T Test. For diagrammatic presentation pie-charts and bar charts are used 1.8 Review of Literature W.K. SARWADE (2011) examined that The researcher wanted to know from the distributors of Amway as to what type of products are more preferred by the Amway customers. Out of the total respondents, 63 respondents said that customers preferred Amway s personal care products, 110 respondents informed about home care products, 179 respondents talked about nutrition. It reveals from the above analysis that nutrition and home care products of Amway were preferred more by the customers and soft toys and other sundry products were not at all preferred. most of the Amway distributors were in between the age of 25 to 45 years and majority of them are male. The total Amway distributors, almost 72 % of the them were male whereas only 28 % were female. On the basis of these percentages, it is very clear that the overall distribution system of Amway is dominated by the male distributors.

4 DR. M. NANDHINI (2014) examined that The distributors has to improve the sale volume of amway products. The amway company must go for heavy promotional activities. The company should introduce more avenues to capture the customers. The company should get feedback and follow periodically for the betterment of consumer. The price should be reduced in order to capture new consumer and to retain old consumer. The quality of product should be modified. N. RENUGA DEVI (2014) defined that Many resources have made studies on health products. Research on nutrition items was worth rating. There are a number of health products and they are playing a vital role in satisfying the thirst and needs of an individual consumers. Brand preference of nutrition items may vary from group to group and also from individual persons. The present study reveals that the consumers preference and satisfaction towards the products. They are mainly motivated by quality of the products. The popularity of the brand also, one of the factors urged the consumers for their purchase decision. Overall, it can be concluded that consumers are satisfied with the quality and vitamin contents but they expect more on reasonable price. VIVEK TRIPATHI (2014) defined that Multilevel marketing (MLM) models have worldwide presence. Multilevel marketing companies, like Amway, are using the existing social relations and social networks for the development of their business model. There is a strict rule in the code of conduct in Amway business bulletin to not give any knowledge about your business to anyone. They are also required to have permission from Amway head office. Distributors are still encouraged to approach friends and family to invite them to join the Amway business. Most of the people do come to know about Amway through a relative but they do not do business with them. Amway business is not done from a fixed location. interaction is done face to face in Amway and thus it grows its business.

5 1.9 Amway India Amway India is the country s leading direct selling FMCG-company which manufactures and sells world-class consumer products. All its products are covered by a 100 per cent Money Back Guarantee. If not completely satisfied with the product, the consumer can return it for a 100% refund. There is no joining fee for the Amway business any adult can enrol as an Amway distributor, without any payment. Amway India is a wholly owned subsidiary of US $ 10.9 billion Amway Corporation, Ada, Michigan, USA. Amway Corporation is one of the largest Direct Selling companies in the world. It has a presence in 80 countries & territories. Established in 1995, Amway India commenced commercial operations in May 1998 and has emerged as the largest Direct Selling FMCG Company. The Company has its headquarters in the National Capital Region of India New Delhi. Amway has invested in excess of Rs. 200 crore in India of this; Rs. 22 crore is in the form of direct foreign investment. Amway India has 500 full time employees and has generated indirect employment for 2000 persons at all the contract manufacturer locations. The Company has provided income-generating opportunities to over 550,000 active independent Amway Business Owners. Amway India provides free and unlimited training to all its distributors to help them grow their business. Amway India conducts over 20,000 training sessions during an average 12-month period with an attendance of over 1.5 million Amway Business Owners and prospects. Amway India recorded a sales turnover of over Rs crore in 2011, up from Rs.1790 crores in ANALYSIS AND DATA INTERPRETATION TABLE 1.1 PREFERENCE OF AMWAY PRODUCT OF THE RESPONDENTS Choosing of No. of Respondents Percentage Particular Brand Quality 79 79%

6 Price 10 10% Customer Service 11 11% Total % SOURCE: Primary Data Interpretation: The table shows that 79% of respondent prefer amway product for Quality, 11% of respondent prefer for Customer service, 10% of respondents prefer for Price. TABLE 1.2 KIND OF AMWAY PRODUCT BY THE RESPONDENTS SOURCE: Primary Data TABLE 1.3 FACTOR AFFECTING PURCHASE Factor Affecting Purchase No: of Respondents Percentage Quality 33 33% Price 40 40% Brand 19 19% Design Of Package 8 8% Total % SOURCE: Primary Data Interpretation: The above table show that 40% of the respondent is affected by Price of amway product and 33% of the respondent is affected by Quality of amway product and 19% of the respondent is

7 affected by Brand of amway product and 8% of the respondent is affected by Design of package of amway product APPLICATION OF STATISTICAL TOOL T-TEST TESTING OF HYPOTHESIS: H0: There is no significant relationship between marital status and the factors affecting the purchase of amway product. H1: There is significant relationship between marital status and the factors affecting the purchase of amway product Result of the Statistical Test on Demographic Factors (marital status) of respondents and the factors affecting the purchase of amway product. Marital Status Mean Std. Deviation T - Value P-Value Inference Married Unmarried Accepted SOURCE: Computed Data Interpretation: Since p-value (0.682) is greater than table value 0.05, therefore the null hypothesis is accepted at 5% level of significance and proved that there is no significant relationship between marital status and the factors affecting the purchase of amway product FINDINGS OF THE STUDY CUSTOMER PREFERENCE TOWARDS AMWAY PRODUCT It is concluded that 79% of the respondents prefer amway product because of its quality. This study shows that 38% of the respondents use amway soap.

8 It is observed that 53% of the respondents will purchase amway product even if there is increase in price. This study shows that 67% of the respondents purchase amway product through amway dealers. It is concluded that 51% of the respondents influenced by the packaging of the product FACTORS AFFECTING THE PURCHASE OF AMWAY PRODUCT It is observed that 60% of the respondents are feel that the country of origin affect their purchase decision. This study shows that 40% of the respondents find the price as the factor that affects to purchase the amway product SUGGESTIONS OF THE STUDY Based on the study the following are the suggestion that should be made by the company with regard to amway product Amway must adopt effective sale promotion methods like advertisement to create awareness among customer so that products will reach every class of people. The advertisement will not only create awareness but also influences the consumers to buy the product, however, the Amway products are not advertisement as other products in the market. The price should be reduced in order to capture new consumer and to retain old consumer. The quantity of the product should be modified. Amway product should be made available in all departmental stores to establish to facilitate the customer to conveniently by the product. The package of the product should be more attractive to increase the sales. Offers & discounts should be announced frequently.

9 1.15 CONCLUSION The study concluded that the respondents prefer amway product only due to the quality of the product even though there is a high price. Amway product purchased through online is more convenient to the customers as compared to purchase of product through amway dealers. The distributors have to improve the sale volume of amway product and the company must go for heavy promotional activities. Even though there is awareness of amway product among the customer, there is only few purchasing the product due to lack of information. Therefore, the company should give more and more advertisements for the information about the product and make the customer to purchase amway product. Amway companies even though perform well they have to abide by certain facts of acceptance. They must act globally and perform the activities locally. BIBLIOGRAPHY BOOKS 1. Fundamentals of Research Methodology- Y.K. Singh, New Age International Publishers. 2. Research Methodology Methods and Techniques- C.R.Kothari, New Age International Publishers. 3. Research Methodology- Ravilochanan, Margham Publications. 4. Research Methodology- Ranjit Kumar, Pearson Publishers. JOURNALS 1. W.K.Sarwade (2011) A study of direct marketing with special reference to amway, International Journal of commerce and business management, Vol-04, Iss-01 April. 2. Dr.M.Nandhini (2014) A study on consumer satisfaction towards amway products in Coimbatore city, International Journal of marketing financial services and management research, Vol-03(10)

10 3. N.Renuga devi (2014) A study on consumer preference and satisfaction towards amway nutrition products with sprcial reference to Coimbatore city, global Journal for research analysis, Vol-03, Iss Vivek Tripathi (2014) A study on social relations and multilevel marketing in india, International Journal of commerce, Vol-05, Iss-09