Comment Number: 522418-03042
Received: 6/16/2006 11:07:35 PM
Organization:
Commenter: Debbie Jelliff
State: NY
Subject: Business Opportunity Rule
Title: Notice of Proposed Rulemaking
CFR Citation: 16 CFR Part 437
No Attachments

Comments:

I am writing to express my strong opposition to the proposed Business Opportunity Rule R511993. I understand that it is the responsibility of the Federal Trade Commission to 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. One of the most confusing and burdensome sections of the proposed rule is the seven-day waiting period to enroll new disstributors. Most of the people who sign an application do so to purchase Shaklee products at a wholesale price, i.e. they are solely 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 of Tax Identification Number. There is no additional kit, fee or application required. The Shaklee Member Kit costs only $19.95. This is far less than many, if not most, consumer purchases, from TVs to all manner of household appliances, none of which require a 7-day waiting period. In addition, the 7-day waiting period is 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 also requires the disclosure of a minimum of 10 prior purchasers nearest to the prospective purchaser. There are many problems with this proposed requirement. In this day of identity theft, I am uncomfortable giving out the personal information of other Shaklee distributors, without their knowledge or consent, to strangers. 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." I believe that this would dissuade new people from signing up as distributors asa they are concerned not only about identity theft, but also about their privacy. People today are understandably reluctant to share their personal information with individuals they may never have met. Obtaining the list of 10 prior purchasers from Shaklee will also be a time-consuming administrative burden on me. Since each prospective recruit will need a customized disclosure statement, the delay will be substantially longer than 7 calendar days before any recruit can sign an application. Such a delay may also make the attainment of a new recuit's specific, time-related goal--a common reason for people to begin a Shaklee busines--unattainable. The rule would also require me to disclose business lawsuits filed against Shaklee Corporation in the last 10 years. It does not make sense to me to disclose this information unless Shaklee Corporation or someone associated with it had been found guilty or liable. My husband and I have been Shaklee distributors for over 30 years, having first begun simply as consumers of the products and then developing a business. We depend on our Shaklee income as a substantial supplement to our budget and look to its growth to soon provide ample retirement income. While I appreciate the FTC's work to protect consumers, I believe this proposed new rule has many unintended consequences for direct sellers and that there are less burdensome alternatives available to the agency to achieve its goals. Thank you for your time in considering my comments. Sincerely, Debbie Jelliff