| Comment Number: | 522418-00234 |
| Received: | 6/1/2006 10:18:56 AM |
| Organization: | Pedersen Shaklee |
| Commenter: | Marilyn Pedersen |
| State: | MN |
| Subject: | Business Opportunity Rule |
| Title: | Notice of Proposed Rulemaking |
| CFR Citation: | 16 CFR Part 437 |
| No Attachments |
Comments:
Dear Sir or Madam, I am writing this letter to express my strong opposition to the proposed Business Opportunity Rule R511993. I understand that it is the responsibility of the FTC to protect the public from "unfair and deceptive acts or practices," but the rule as proposed would make it nearly impossible for me to operate my business as a Shaklee Independent Distributor. One of the most burdensome sections of the proposed rule is the 7-day waiting period to enroll new distributors. Most of the people I sign up do so to purchase Shaklee products at a wholesale price. They are solely consumers. If they wish to build a business, all they must do is provide Shaklee with their SSN or TIN. There is no additional kit, fee, or application required. The Shaklee Member Kit costs only $19.95. This is far less than most purchases consumers make, none of which require a 7-day waiting period. In addition, the 7-day waiting period is unnecessary in that Shaklee already has a 90% buyback policy for products, including the member kit, purchased by a distributor within the last 2 years. The proposed rule requires the disclosure of a minimum of 10 prior purchasers nearest to the prospective purchaser. There are many problems with the requirement. In this day of ID theft, I am uncomfortable giving out the personal information of other Shaklee distributors, without their knowledge or consent, to strangers. I understand that those who sign up after the rule takes effect would be told in writing "If you buy a business opportunity from the seller, your contact information can be disclosed in the future to other buyers." I know this would dissuade new people from signing up as distributors and I see absolutely no purpose or value in this requirement in our business. I know that I would never be a distributor today or own my own business if I had to follow this requirement. People that I work with are understandably wary of giving out personal information to anyone, especially those they have never met. In addition, the 10 references also could damage the businesses of many Shaklee distributors. Providing a list of names to a potential recruit could result in an invitation to unwanted soliciting. My customers would be offended and I would probably lose my business dealings with them. The 10 reference requirement also is an administrative nightmare. I would have to obtain such a list from the Shaklee Corporation. This will result in a delay far longer than 7 days. In our business, this delay will result in loss of business. The proposed rule calls for the release of any information regarding lawsuits that allege misrepresentation, or unfair or deceptive practices over a 10-year period. It does not matter if the company was found innocent or not liable. Today, almost all business lawsuits contain claims of misrepresentation or unfair competition. It does not make sense to me that I would have to disclose these lawsuits unless Shaklee Corporation, or its officers, directors or sales department employees, had been found guilty or liable. Otherwise, 50-year old companies such as Shaklee Corporation and their distributors would be placed at a disadvantage compared to start-up direct selling companies, which may not yet have experienced litigation but which are far more likely to have legal issues surrounding their opportunities. I have been a Shaklee Distributor for over 35 years. I love the Company's philosophy, integrity, commitment to a healthy environment, and safe nutritional/personal care/household products. I also needed a business that would carry me into retirement, as well as providing extra income. The opportunity to work from home is valuable. I am close to retirement and am going to depend on my Shaklee business to supplement SS income. I appreciate the FTC work to protect consumers, but I believe this proposed new rule has many unintended ills. Thank you for your time. Marilyn Pedersen