| Comment Number: | 522418-07401 |
| Received: | 7/10/2006 6:49:32 PM |
| Organization: | Shaklee Independent Distributor |
| Commenter: | Ammirato |
| State: | CT |
| Subject: | Business Opportunity Rule |
| Title: | Notice of Proposed Rulemaking |
| CFR Citation: | 16 CFR Part 437 |
| No Attachments |
Comments:
July 10, 2006 Re: Business Opportunity Rule, R511993 Dear Sir/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 7-day waiting period to enroll new distributors. Most of the people who sign a Shaklee application are consumers of the products. If they later wish to build a business, all they must do is supply Shaklee Corporation with their Social Security Number or Tax Identification Number. No additional kit, fee or application is required. The Shaklee Member Kit costs only $19.95. This is far less than most consumer purchases, from TVs to all manner of household appliances, none of which require a waiting period. The waiting period is also 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. 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, without their knowledge or consent. 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. 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 7 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. I have been a Shaklee Distributor for more than 9 years. The products have changed my life and have afforded me the opportunity to help others. Due to a plant closing in 3/06, I lost my full-time job of 10 years (the 7th in 16 yrs due to to mergers, closings and bankruptcy.) Shaklee was part-time at the time of my job loss. Now I am taking the opportunity to expand my Shaklee business and have become extremely dependent on my Shaklee income for my livlihood. The integrity of Shaklee Corp continues to amaze me. This proposal would greatly hurt my ability to do business, especially during these difficult economic times. Please either rewrite this proposal so as not to hurt legitimate direct sales companies, or scrap it. Thank you for considering my comments. Respectfully submitted, S. Ammirato