| Comment Number: | 522418-06635 |
| Received: | 7/6/2006 10:46:05 PM |
| Organization: | Usana Health Sciences |
| Commenter: | Kelly Sennholz |
| State: | CO |
| 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 because the proposed Business Opportunity Rule (R511993) as presently drafted would put a huge strain on, or even ruin, my independent Usana Health Sciences business. I have spent a lot of time and energy to build this successful small business. I believe the rule goes too far in trying to protect the public by proposing certain unnecessary and burdensome requirements that will make it very difficult if not impossible for me to sell USANA products. One particularly burdensome and confusing sections of the proposed rule, is the seven-day waiting period to enroll new independent USANA Associates. USANA’s sales kit only costs $49.95. People buy TV’s, cars, and other items that cost much more than that, and they do not have to wait seven-days. This waiting period gives the impression that there might be something wrong with USANA’s business plan. Due to USANA’s 100% buyback policy for all products within the initial 30 days and a 90% buyback for products purchased within the last twelve months, this seven-day waiting period is entirely unnecessary. According to this rule, I will need to keep very detailed records of when I first speak to someone about USANA and send very detailed reports to USANA headquarters. There is also a provision calling for the release of any information regarding lawsuits, involving misrepresentation, or unfair or deceptive practices. It does not matter if the company was found innocent. Today, anyone or any company can be sued for almost any reason. It does not make sense to me that I would have to disclose these lawsuits.Otherwise, USANA and my independent USANA business are put at an unfair advantage because potential independent USANA Associates are misled to believe that USANA is guilty of wrong-doing even though USANA may have done nothing wrong. Finally, the proposed rule requires the company to disclose to each prospective independent USANA Associate the names and contact information of a minimum of 10 previously enrolled independent USANA Associates who live nearest to the prospective Associate. In this day of identity theft, I am find it totally unreal to expect I would give out other people's private information. Also, sharing this type of information with business prospects who may be involved in other network marketing businesses creates an opportunity for those prospects to recruit enrolled USANA Associates away from the USANA opportunity. USANA considers the names of its independent Associates to be confidential and trade secret information, and a requirement to disclose this information for this purpose makes it very difficult for USANA to protect its trade secret information and this could damage the company’s business. Moreover, in order to get the list of the 10 previously enrolled independent Associates, I will need to send the address of the prospective Associate to USANA headquarters and then wait for the list. This will make recruiting prospects for the USANA opportunity virtually impossible. I also think the following sentence required by the proposed Rule will prevent many people from wanting to sign up as an independent USANA Associate, “If you buy a business opportunity from the seller, your contact information can be disclosed in the future to other buyers.” People are very concerned about the privacy of their personal information and the potential for identity theft. They will be reluctant to share their personal information with individuals they may have never met. I have been an independent USANA Associate for two years. I make my livelihood teaching others about nutrition and Usana. These new rules would virtually put me out of business. I have worked very hard to build a respectable business and now my family depends on this extra revenue to supplement our income. I appreciate the work of the FTC to protect consumers, but I believe this proposed new rule has many unintended consequences and that there are less burdensome alternatives available in achieving its goals. Thank you for your time in considering my comments. Sincerely,