| Comment Number: | 522418-01020 |
| Received: | 6/5/2006 10:28:42 PM |
| Organization: | |
| Commenter: | Joni Knox |
| State: | TX |
| 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 to express strong opposition to the proposed Business Opportunity Rule R511993. I understand that the Federal Trade Commission must protect the public from "unfair and deceptive acts or practices," but the rule as proposed would make it very difficult for me to operate my business as a Shaklee Independent Distributor. A confusing and burdensome section of the proposed rule is the seven-day waiting period to enroll new distributors. The waiting period is unnecessary in that Shaklee Corporation already has a 90% buyback policy for products, including the Member Kit, purchased by a distributor within the last two years. By the way, the Member Kit is only $19.95--far less than most consumer purchases, from TVs to all manner of household appliances, none of which require a waiting period. The proposed rule requires the disclosure of a minimum of 10 prior purchasers nearest to the prospective purchaser. In this day of identity theft, I am uncomfortable giving out the personal information of other Shaklee distributors. 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." This would dissuade new people from signing up as distributors as they are concerned not only about identity theft, but also about their privacy. Providing the 10 references also could damage the businesses of Shaklee distributors. Lower ranking distributors often are involved in more than one direct selling company. Providing a list to a potential recruit, who may already be a distributor for a competing direct selling company, may be an invitation to solicit existing distributors for such other opportunity. The 10 reference requirement is an administrative burden. To obtain the list of 10 prior purchasers, I will need to provide Shaklee Corporation with the prospective distributor's address, and wait to receive the list of the 10 nearest distributors who became distributors within the past three years. Each prospective recruit will need a customized disclosure statement. This will result in a delay far longer than seven calendar days before anyone can sign an application. Many people enter direct selling to earn extra income for a specific goal, such as holiday purchases or a family vacation. The wait which the proposed rule creates may make the goal unattainable. 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--even if the company was found innocent or not liable. Fifty-year old companies such as Shaklee would be at a disadvantage compared to start-up companies, which may not yet have experienced litigation but are far more likely to have legal issues surrounding their opportunities. I have been a Shaklee Distributor for more than seven years. Originally, I became a Shaklee Distributor because I love the Company's nutritional/personal care/household products and wanted to earn some additional income working from home. Now we depend upon this extra income to supplement our budget now that I am no longer employed. Because of my multiple sclerosis, a Shaklee business IS something I can do from home, but the proposed Business Opportunity Rule will certainly detract and create difficulty in building an income. I left the workforce in 1998 as the 'stress in the workplace exacerbates my multiple sclerosis,' per my neurologist, Dr. Norma Melamed, Dallas, Texas. I would rather not collect SSI and to date, have not. If it's too hard (and stressful), why would someone like me continue in this very honorable company (Shaklee)? Please do not make it harder for either the customer to get the products they want/need --or-- for the seller (me!) by earning a legitimate income. Thank you for considering my comments. Respectfully,