As we discussed, the D2C or direct-to-consumer model has revolutionized business in India. While D2C has been associated with urban markets, we should explore the D2C model’s potential for India’s rural suppliers to transform their operations and reach a broader customer base.

But, as with all major changes, it is not as easy as it sounds. The pros and cons need to be evaluated since rural businesses (especially those led by women entrepreneurs) have just started to see the positives of self-employment and are starting to climb the financial pyramid. Any large drop could disrupt their lives.

One of the most popular benefits of the D2C model is that it cuts off the middleman. Indeed, rural suppliers often face challenges associated with middlemen, who often take a significant share of profits and control the supply chain. By adopting the D2C model, rural suppliers can bypass intermediaries, establish direct relationships with consumers, and keep better control over pricing and distribution.

However, this assumes that the rural business, still in its infancy, will be ready to establish the distribution channel with the same expertise. Those who work closely with rural businesses will also understand that several distribution channels also aid in the financial literacy of rural business owners. Earning is not the only objective; managing the increased earnings in a manner beneficial for long-term growth is also important for rural entrepreneurs. While cutting off the seasonal brokers will help, it might be counterproductive to eliminate the chain of such distributors.

We all agree that a primary advantage of the D2C model is its ability to reach consumers regardless of geographical barriers. Rural suppliers can leverage digital platforms and e-commerce channels to showcase their products to a wider audience beyond local markets. This expanded reach opens up new opportunities for growth and revenue generation. Moreover, rural suppliers have a deep understanding of the production process and can tailor their product offerings to meet the specific needs of their target audience. This customization can include variations in product sizes, packaging, and even product features, catering to diverse consumer preferences.

Conversely, over-customization may lead to quality issues, tarnishing the brand image. Direct interaction with consumers in forums may lead to negative word-of-mouth if the quality suffers. While distributors are normally strict with rural suppliers to maintain stringent quality standards and ensure product authenticity, by eliminating intermediaries, quality personnel with little or no training may have to oversee every aspect of the production process, from sourcing raw materials to packaging and delivery. This could make it hard to maintain high-quality products that meet consumer expectations.

In summary, we should welcome the D2C model for rural entrepreneurs, provided they are trained in financial literacy and quality assurance skills.