Comment Number: 522418-08797
Received: 7/13/2006 1:45:19 PM
Organization:
Commenter: Brock Young
State: FL
Subject: Business Opportunity Rule
Title: Notice of Proposed Rulemaking
CFR Citation: 16 CFR Part 437
No Attachments

Comments:

I have been a Quixtar IBO for about 21 years, but actively building the business a few months. Up to that time, we purchased products at wholesale, and small amounts of retail. We typically saved about $1500-3000 per year by purchasing products at wholesale (which is why we continually renewed), as the renewal price was less than Sam's Club, but better. Throughout the 20+ years, Quixtar and our sponsoring IBO have continually exceeded all expectations, and any issue was always cleared up equally or greater than our expectaions. It was the over abundance of fairness that kept us renewing. Our lifestyle has changed recently (outside of Quixtar), inspiring us to build a larger Quixtar business. With the extensive history we had with Quixtar, we had all the confidence that it was the right business for us, as well as proof of full disclosure. Now that we are sponsoring IBOs, we disclose the same type of info to new IBOs. We provide prospective IBOs with an SA4400 which discloses average income, potential income, etc. We also make clear that this is a regular business that only succeeds if the individual performs - and is not a "get rich quick" scheme. We provide websites to neutral and biased sources, and answer questions. At time of registration, the only requirement is the $45 that Quixtar requires. We recommend other items based on the IBOs individual long-term goals and objectives. Our typical startup costs are $125, which includes $60 in products. We have had cases where an IBO does not take advantage of any profit or savings. For those, we offer to reimburse the $55 and even buy back any products not used (Quixtar guarantees all). We then turn those individuals to retail customers, at no cost to them. SEVEN DAY WAIT - First off, there is no risk to the prospect, as they can get their money back, so the 7-day wait would not protect anyone, and only cause harm to all parties. This would negatively impact our business, as we would have to take up more valuable time and resources to revisit the potential IBO. Since the IBO can get their money back, there is no reason to have a 7-day period. I know if we waited 7 days, we would not have been IBOs. PROVIDING REFERENCES - First off, there is no risk to the prospect, as they can get their money back. I have another business outside of Quixtar, and I would never provide references to my competitors - and other IBOs are competitors, even though we work together in harmony. This just does not make sense. Even if I did give references, they would be ones I chose, and would only say what I wanted them to, so it would be a biased anyways. LITIGATION LIST - First off, there is no risk to the prospect, as they can get their money back. Would be impossible to manage. Also, misleading to the prospective IBO. Also, with the internet, the IBO can easily perform research. SPECIFIC EARNINGS DISCLOSURE - FINANCIAL SUBSTANTIATION - First off, there is no risk to the prospect, as they can get their money back. We already give IBOs average incomes and the SA4400. To provide specific information would actually be misrepresenting, as an IBO making $150,000 would make a new IBO think that is the norm. Or someone like us (that only bought wholesale for 20 years) would make an IBO feel the business is not worthwhile, even though the individual's activity is the true key to success. In my case, I had no business building activity, and had no business growth (as expected). Either scenario would be misleading. Averages are the only way to go here.