| Comment Number: | 522418-10602 |
| Received: | 7/16/2006 6:47:08 PM |
| Organization: | Quixtar, Inc. |
| Commenter: | Sean Behan |
| State: | CO |
| Subject: | Business Opportunity Rule |
| Title: | Notice of Proposed Rulemaking |
| CFR Citation: | 16 CFR Part 437 |
| No Attachments |
Comments:
Dear FTC, I am writing regarding the proposed FTC Rule affecting the direct selling industry. I am an Independent Business Owner affiliated with Quixtar, Inc., and have been for just over 7 years. The proposed FTC Rule has come to my attention, and I would like to address several issues. Let me start by saying that I am totally supportive of eliminating all illegal, shady, and dishonest businesses that can sometimes call themselves direct selling, network marketing, etc. However, I believe the proposed rule would not efficiently achieve this end and would cripple those companies that are completely ethical and well run, such as Quixtar. Personally, when I originally registered as an Independent Business Owner (IBO), I was given more than enough information to make a wise, educated, and calculated decision. I was completely aware that my income potential was purely based on my performance and how hard I worked at developing my business. Of course there are no guarantees of success, just like any other business in the world. Besides the money that is available, there are many other benefits that are derived from being associated with this business. These things include developing people skills, attitude, confidence, friendship, and several other serendipities that many people would never guess. I know that what I have learned in my own business has helped me become far better in my corporate job. There are not many businesses that offer such great rewards (with the proper work) and with such little risks. When I start a new IBO, it typically costs about $45 to register and get access to products. However, I usually suggest they invest in receiving company publications as well as product sample packs (all of which is totally refundable, except for the shipping costs of course). Depending on what they want to achieve, there are also optional educational materials that can be bought to help them learn more about developing business. If they choose to go this route, it is usually only about $249. Therefore, a complete start up costs only about $374, which is unheard of for most new businesses (plus since there’s really no risk because of the money back guarantees). The proposed FTC rule would hinder my ability to do business as well as my ability to help others build businesses. Prospective business owners are provided with enough info to make a wise decision, and even if they want, they can get there money back. Next, the list of references would completely undermine the entire concept of business. Because we are all Independent Business Owners, those references might as well register the prospect into their own business. This would be laughable in the corporate world. I am a broker, and if I needed to give clients a reference of other brokers, that would make no business sense, and would kill my business because those brokers would go after my clients. Furthermore, new IBOs can learn about other IBOs’ experiences through meetings and other social events. Plus, having me as a reference on other IBO’s lists would violate my own privacy. Next, the rule to provide a list of litigation over 10 years would not prove to be effective. Not only would dishonest companies ignore this rule, the good companies are hurt because they would have to even show all erroneous litigation and be open to even more false accusations. Every business has their critics (just look at Microsoft and Wal-Mart), but they don’t disclose this kind of information to all their customers and/or employees, etc. Finally, the disclosure of earnings rule is an unnecessary burden and not proper. Again, in my corporate job, I don’t have to tell others how much I make. This is just rude. Furthermore, we do provide income disclosures on the forms that new IBOs sign, so that they know what an “average” person makes. This is more than enough information to provide without violating my own privacy rights. Thank you for your consideration.