Comment Number: 522418-07990
Received: 7/12/2006 9:42:40 AM
Organization: The Longaberger Company
Commenter: Judy Wise
State: IN
Subject: Business Opportunity Rule
Title: Notice of Proposed Rulemaking
CFR Citation: 16 CFR Part 437
No Attachments

Comments:

Judy Wise JW Enterprises of Indiana, Inc  July 12, 2006 Federal Trade Commission/Office of the Secretary, Room H-135 (Annex W) Re: Business Opportunity Rule, R511993 600 Pennsylvania Avenue, NW Washington, DC 20580 RE: Business Opportunity Rule, R511993 Dear Sir or Madam: I am writing this letter because I am concerned about the proposed Business Opportunity Rule R511993. I have been an Independent Longaberger Home Consultant for more than 18 years and am very troubled of how this rule could affect my direct selling business as an Independent National Sales Leader with The Longaberger® Company. I initially became a Longaberger Home Consultant because I loved the products and wanted to earn some extra income alongside my full time job. I realized after 2 years that I wanted to pursue this type of career full time and have been successful by becoming a full time Home Consultant since 1996. It is my soul income and in today’s world, it is already difficult enough by fighting the economy and rising costs in many day-to-day dependencies without adding more regulations. Many of my consultants are in this business alongside a full time career and family. Direct Sales is an opportunity for many to have extra income and have some fun for themselves. Many find later that they can pursue this opportunity as a full time career; however, I’m fearful of the discouragement it will cause in the beginning just to do something on a part time or full time basis. I really hate to hear that regulations are pending to prevent something that is an opportunity to end up being a deterrent from the majority that may be considering a business to supplement their income or looking for something fun to do. I understand that part of the FTC’s responsibilities is to protect the public from “unfair and deceptive acts or practices,” but some of the sections in the proposed rule inhibit my ability to have a career opportunity or offer one to other women and men. One of the most confusing and troublesome sections of the proposed rule is the seven-day waiting period to enroll new Home Consultants. To get started in a Longaberger business, the business kit only costs $199. People buy TV’s, cars, and other items that cost much more than that, and they do not have to wait seven days. This waiting period gives the impression that there might be something wrong with our business opportunity. I also think this seven-day waiting period is unnecessary because direct selling companies have a 90 percent buy-back policy for all products, including business kits purchased by a salesperson within the last twelve months. In fact, our company’s buy-back exceeds the DSA Code of Ethics requirement, which, in my opinion, makes this rule unnecessary. Under this waiting period requirement, I will need to keep very detailed records when I first speak to someone about Longaberger and will then have to send in many reports to the company headquarters. Additionally, it is my understanding that the proposed rule also calls for the release of any information regarding lawsuits involving misrepresentation, or unfair or deceptive practices. It does not matter if the company was found innocent. Today, anyone or any company can be sued for almost anything. It does not make sense to me that I would have to disclose these lawsuits unless Longaberger is found guilty. Otherwise, Longaberger and I are put at an unfair advantage even though The Longaberger Company has done nothing wrong. Finally, the proposed rule requires the disclosure of a minimum of 10 prior purchasers nearest to the prospective purchaser. I am glad to provide references, but in this day of identity theft, I am very uncomfortable giving out the personal information of individuals (without their approval) to strangers. Also, giving away this information could damage the business relationship of the references that may be involved in other companies or businesses, including those of competitors. In order to get the list of the 10 prior purchasers, I will need to send the address of the prospective purchaser to Longaberger headquarters and then wait for the list. I also think the following sentence required by the proposed rule will prevent many people from wanting to sign up as a salesperson: “If you buy a business opportunity from the seller, your contact information can be disclosed in the future to other buyers.” People are very concerned about their privacy and identity theft. They will be reluctant to share their personal information with individuals they may have never met. I appreciate the work of the FTC to protect consumers, but I believe this proposed new rule has many unintended consequences and I think there are other alternatives available in achieving its goals that have a much more positive outcome. Thank you for your time in considering my comments. Sincerely, Judy Wise Independent National Sales Leader