Comment Number: 522418-06194
Received: 7/5/2006 5:04:35 PM
Organization: Kilic and Company
Commenter: Jan Kilic
State: GA
Subject: Business Opportunity Rule
Title: Notice of Proposed Rulemaking
CFR Citation: 16 CFR Part 437
No Attachments

Comments:

Jan J Kilic Kilic and Company  July 5, 2006 Federal Trade Commission/Office of the Secretary, Room H-135 (Annex W) 600 Pennsylvania Avenue, NW Washington, DC 20580 RE: Business Opportunity Rule, R511993 Dear Sir or Madam: This letter is in reference to the proposed Business Opportunity Rule R511993. It is my opinion that in the current form that you are considering this it will dramatically impact my ability to continue successfully as an Arbonne Independent Consultant. While it is clear to me that the FTC’s responsibility is to protect the public from “unfair and deceptive acts or practices,” I don’t believe that the FTC would ever intend to hurt people who are using ethical and fair business practices. Unfortunately, if this rule passes in its current form that is exactly what will happen to my business for the following reasons. The proposed 7-day waiting period to sign up a new Consultant will not protect someone from being deceived; it will only create a sense that there is a possibility that this person may be deceived. When you tell someone they must wait 7 days to get started because a government agency says so, it gives an appearance that there may be something hidden. As it stands anyone who enters a contractual agreement is allowed a 72 hour right of refusal no matter what kind of contract it is. This should be sufficient, as it is in many businesses in which people exchange many more dollars to get started. To sign on as an Independent Consultant with Arbonne International, in my opinion, requires a minimal commitment of money. The newly sponsored person is not trapped into spending anymore money than the nominal start up cost that they are well aware of. I believe the intent for this waiting period is to keep people from making impulsive emotional financial decisions. But the sign up as an Independent Consultant does not require any impulsive financial decisions. When you make them wait, they begin to think there is something in the fine print that maybe they missed, which of course, there is not. And furthermore it creates an unfair business practice in that no one has to wait 7 days to purchase products from any store front. In this litigious society that we live in people are always looking over their shoulder for when someone is going to deceive them, so when you begin planting that further into their mind by creating rules based on “what ifs” instead of consequences based on actions, you potentially cripple the hard working ethical people who are just trying to build an honest business. In addition, this proposed rule also requires that we release information regarding lawsuits involving misrepresentation, or unfair or deceptive business practices. People have individual interpretation as to what is “unfair or deceptive business practices.” As I pointed out, this society is very litigious, so no matter who is at fault, there can be lawsuits. When people fail in business, they many times go looking for someone to blame. We in the field are not privy to all the details of these potential conflicts, nor do we have the time or energy to figure out all the motives of the individuals bringing the lawsuit. If a person wants to become an Independent Consultant with Arbonne, it is generally because they love the products and they trust the person they are talking to directly. Again, just as with the 7 day waiting period, if I begin to introduce elements of doubt by being required to disclose general information about lawsuits and I have no specific knowledge as to the motives of those litigators and so therefore cannot give a full clear understanding of each and every case, then my business can be judged based on partial information through no fault of my own or Arbonne’s. And furthermore any suspicion that it may raise can create an appearance that I am dishonest if I am associated with a company that has only been accused of being unfair and dishonest. Finally, the proposed rule requires the disclosure of a minimum of 10 prior Independent Consultants nearest to the prospective Consultant. When I am talking with a customer who may decide to become an Independent Consultant, I spend 3 to 4 meetings and let them meet other team members. At Arbonne, the policy is to always introduce people to other team members so they can see the culture of our business. We are not interviewing for a job. We are Independent Consultants implying that what another Independent Consultant thinks of me should have no bearing on a prospective person looking at becoming an Independent Consultant. There are many built in incentives for me to be a good sponsor and of good character, not the least of which is the success or failure of my business. After all, I cannot grow a very big business if I am not a good sponsor. Also, it will infringe upon my privacy to make my personal information available to any and all other consultants. We independently do business with Arbonne, not each other. It is of course in my best interest to aid in the training of my team and as a matter of fact required in order for me to make management positions within Arbonne. I am contractually bound with Arbonne to give and support training on my team. So if I am sponsoring someone it is between me and that person to be accountable and should have no bearing on what another consultant perceives. Again, the people who have left the business can have all kinds of reasons for not making it in the business and may not disclose that they did not attend any trainings or do the work necessary to build the business properly, but merely that they were not trained and assisted. They may not take responsibility for their own failures, but instead blame another thus hurting a business unjustly. I have been an Arbonne Independent Consultant for almost 2 years. I decided to become an Independent Consultant with Arbonne because of its excellent quality of products and my belief in Network Marketing as a phenomenal business plan and a way to build an stream of income for my family. I have built a team of well over 1500 people and each and every one of those people to the best of my ability have been trained both in fair and ethical business practices and how to be successful in this business. It has been my experience with Arbonne that when an Independent Consultant does exhibit unfair and deceptive business practices that Arbonne is there to stop them from that. I cannot speak for all Network Marketing and Direct Sales companies, but I can speak for Arbonne and they police their own. Direct Sales and Network Marketing are industries that allow millions of Americans the opportunity to build a potential substantial income without risking substantial money if and when they are willing to put in the work as is necessary in any successful business. The principles that hold these industries together are the principles that are the very fiber that our country was built upon, namely the individual entrepreneur. The FTC has done a phenomenal job of trying to make sure that fair and ethical business practices are held as the standard. If you begin to add rules that constrain us in doing our business, then you are putting us at a completely unfair disadvantage. As a private citizen I appreciate agencies such as yours who protect us from people who are trying to deceive unfortunate citizens and I know that rules are a necessary aspect of any society to have order. But in my opinion, this particular proposed rule in its current form can actually serve to harm more honest and ethical people than protect those very same honest and ethical people. I am certain it is the FTC’s intention to protect and not harm. Thank you for all that you do on our behalf and for considering my humble thoughts on these matters. Sincerely, Jan J. Kilic