Comment Number: 522418-05140
Received: 6/29/2006 7:46:51 PM
Organization: Quixtar
Commenter: Whiteside
State: FL
Subject: Business Opportunity Rule
Title: Notice of Proposed Rulemaking
CFR Citation: 16 CFR Part 437
No Attachments

Comments:

First, I would like to extend my appreciation to the FTC for recognizing the need for greater regulation of business opportunities. If the general public were made more aware of the difference between legitimate opportunities and pyramids, get-rich-quick scams, etc., it would enhance my ability to conduct business. However, I am concerned about some of the items outlined in this proposal. First, I find it ridiculous that there would be a 7 day waiting period before a prospect could become registered. With respect to the Quixtar business, the mandatory registration fee is $51.50, which is refundable minus a $5 processing fee within a person's first 6 months of business. I also recommend my prospect purchase approximately $90 worth of products, which also comes with a 6 month full money back guarantee. No individual needs 7 days to ponder committing $150, especially when a near-full refund is available for 6 months. Perhaps such a waiting period could be enforced if the initial (mandatory) registration cost exceeds $250 and/or there is a limited refund policy available. Also, companies could be required to clearly outline their refund policy at the time of registration so there is no confusion. Next, I take issue with the impractical notion that I would be required to give my prospect a list of references before registration. Most Independent Business Owners have hectic lives and the added inconvenience of talking to someone else's prospect would be an additional burden. Not only would this curious prospect have the opportunity to interrupt a business owner's life at his/her personal convenience, but the reference may not reflect the attitudes/thoughts/feelings of the prospect's potential sponsor or possess all of the information to clearly and appropriately answer any questions asked by the prospect. The great thing about the Quixtar business model is that it provides one-on-one mentorship that is tailored to the individual. If a prospect interacts with one reference who is having a bad day, it may ruin all of the efforts the potential sponsor has invested. Moreover, a reference most likely will have no vested interest in the prospect's success and thus has little incentive to take the time to fully answer questions. Additionally, an ill-meaning reference could potentially "steal" the prospect for his own business team. In the Quixtar business model, prospects have the opportunity to attend a weekly class to meet additional members of the business team, ask questions, and observe the atmosphere. Lastly, not all registered business owners are actively building the business and thus the list of references would need to be constantly updated in order to ensure the references actually know what they are talking about. Providing information regarding legal actions against the company are also a poor idea because the average person would have no idea how to interpret the information, especially erroneous allegations, and any individual who would know how to interpret it could perform the research to find such information. Next, any income disclosure should be direct and simple to understand. At the time of registration, the Quixtar website clearly states that the average active IBO earns $115. Any disclosure more complicated than that will probably not even be read, let alone understood. Lastly, disclosure of personal financial statements is excessive. Most individuals are discerning enough to realize that an individual driving a Kia with 3 people on his team most likely isn't making $2,000. Moreover, my success (or lack thereof) has no bearing on the prospect's ability to succeed, as there is someone who is genuinely successful in my upline that can be of assistance. My Quixtar-powered business has provided me with income, friendship, self-confidence and many other intangibles. This proposal, in its current form, will only harm legitimate businesses. Please do not regulate business opportunities at my expense.