godok.id

PM-InternationalNutrition /www.pm- international.comPola, Inc.Cosmetics, Food/GourmetItems, Fragrances,Haircare/Hair Accessories,Health/Fitness/Wellness,Nutritional Supplements,Skincarehttp://www.pola.comPremier e-Paid LegalServices, Inc.Legal Serviceshttp://www.prepaidlegal.comPrimerica FinancialServicesFinancial Serviceshttp://www.primerica.comPrincess House, Inc. Cookware, mPrivate QuartersHome Pro Monde TravelTravelhttp://www.promondetravel.comPurely Gourmet LLC Food/Gourmet Itemshttp://www.purelygourmet.comQuixtar Inc.Health/Fitness/Wellness,Personal Carehttp://www.quixtar- BC Life SciencesNutritional gal Ware, Inc.Cookware, Cutlery,http://www.regalware.comTableware, Water TreatmentSystemsReliv International,Inc.Nutritional Supplements,Personal CareRena WareInternational, Inc.Cookware, Water Treatment http://www.renaware.comSystemsRexair, Inc.Homecare, owsystem.com

Richmont dles/Candle Accessories,Cookware, GardenAccessories, HolidayDecorations, House andKitchenwares, Jewelry,Photography/PhotoProcessing, TablewareSaladmaster, Inc.(Regal Ware, Inc.)Cookwarehttp://www.saladmaster.comA Sandy Clough Tea Coffee/Tea/SpecialtyBeverages, Giftwarehttp://www.asandycloughtea.comSarah e, LLCNutritional SupplementsSeneGenceInternationalCosmetics, Personal Carehttp://www.senegence.comSensaria NaturalBodycare, Inc.Haircare/Hair Accessories,Skincarehttp://www.sensaria.comSetting mShaklee Corporation Air Filters/Air Filtrationhttp://www.shaklee.comSystems, Cosmetics,Health/Fitness/Wellness,Homecare, NutritionalSupplements, Personal Care,Skincare, Water TreatmentSystems, WeightManagementShare the WealthHaircare/Hair Accessories,Personal Carehttp://www.johnamico.comShure Pets, Inc.Animal/Pet e omSilpada DesignsJewelryhttp://www.silpada.comSimplyFun, LLCToys/Gameshttp://www.simplyfun.com

SMC SpecialtyMerchandise Corp.Aromatherapy, Art/Framing, http://smcorp.comBaskets, Candles/CandleAccessories, Cookware,Crystal/China, Cutlery,Fashion Accessories,Fragrances, GardenAccessories, Giftware,Holiday Decorations, HomeTechnology, House andKitchenwares, Jewelry, PartySupplies, Personal Care,Religious Books/Gifts,Skincare, Tableware,Toys/GamesSouthern Living AtHOMEBooks, Garden Accessories,Home Accessories/DécorThe SouthwesternCompanyBooks, Software/Computers http://www.southwestern.comSpa Candle Accessories,Personal Care, Skincare, SpaProductsSportronInternational, Inc.Homecare, NutritionalSupplements, Skincare,Weight ManagementStampin' Up!Rubber Stamps,http://www.stampinup.comScrapbooking/Photo AlbumsStanley care, Personal nationalCosmetics, Homecare,Nutritional Supplements,Personal Care, py, pathics, PersonalCare, hernlivingathome.comhttp://www.sportron.com

e, Personal Care,Water Treatment Systems,Weight Managementhttp://www.symmcorp.comTahitian NoniInternationalNutritional Supplementshttp://www.TahitianNoni.comTake Shape for Life, Health/Fitness/Wellness,Inc.-MedifastWeight Managementhttp://www.takeshapeforlife.comTanner Companies,LLCClothing/Shoes, smetics, Inc.Skincarehttp://www.tarrah.comTaste of GourmetFood/Gourmet Itemshttp://www.tasteofgourmet.comTastefully Simple,Inc.Food/Gourmet asuresCoffee/Tea/SpecialtyBeverages, Food/GourmetItems, Giftware, -One dles/Candle Accessories,Giftware, JewelryThree Girls WhoFashion nshi HealthProducts, Inc.Nutritional Supplementshttp://www.tiens.comTomboy Tools, Inc.Scrapbooking/PhotoAlbums, Toolshttp://www.tomboytools.comTravel ReactionTravelhttp://www.travelreaction.comThe TravelingVineyardFood/Gourmet Items, PartySupplies, Tableware,Wine/Wine ar Enterprises,LLCVacuum Cleanershttp://www.tristarclean.comTupperware BrandsCosmetics, House andKitchenwares, Toys/Gameshttp://www.tupperware.com

Two Sisters Gourmet Food/Gourmet Items, House http://www.twosistersgourmet.comand KitchenwaresUnicityInternational, Inc.Health/Fitness/Wellness,Nutritional Supplements,Personal Care, WaterTreatment Systemshttp://www.unicitynetwork.comUnique BabyBoutique, Inc.Baby/ChildcareU.S. Safety &EngineeringCorporationSecurity Systems/DevicesUSANA HealthSciences, Inc.Haircare/Hair Accessories,Health/Fitness/Wellness,Nutritional Supplements,Oral Hygiene, PersonalCare, Skincare, WeightManagementhttp://www.usana.comUsborne Books atHomeBookshttp://www.ubah.comVantel Pearls in theOysterJewelryhttp://www.vantelpearls.comVision For w.V4L.comHomecare, NutritionalSupplements, Personal Care,Weight ManagementVita CraftCorporationCookware, Crystal/China,Cutlery, TablewareVIVA Life Science,Inc.Haircare/Hair Accessories,Health/Fitness/Wellness,Nutritional Supplements,Personal Care, Skincare,Weight Managementhttp://www.vivalife.comViviane WoodardCosmetics, Fragrances,Haircare/Hair Accessories,Nutritional Supplements,Personal Care, Skincarehttp://www.goviv.comVorwerk USA Co.,L.P.Home Applianceshttp://www.thermomix.com

Weekenders USA,Inc.Clothing/Shoes, e Herbs, Inc. Food/Gourmet Itemshttp://www.wildtreeherbs.comWineShop At Home Food/Gourmet Items, PartySupplies, Tableware,Wine/Wine Accesorieshttp://www.wineshopathome.comWorld Book, Inc.Encyclopediashttp://www.worldbook.comXanGo LLCNutritional Supplementshttp://www.xango.netXELR8Food/Gourmet Items,Health/Fitness/Wellness,Nutritional Supplements,Weight Managementhttp://www.xelr8.comYoffi Fine JewelryFashion Accessories,Jewelryhttp://www.sell- .Com,Inc.Internet Serviceshttp://www.yournetplus.comCosmetics, Personal Carehttp://www.zermat.com.mxZermat International,LLC

Appendix B2004 DSA Fact Sheet

2004 DIRECT SELLINGGROWTH & OUTLOOK SURVEY2003 U.S. Retail Sales 29.55 BillionPercent of Sales by Major Product GroupHome/family care (cookware, appliances, etc.)Personal care (cosmetics, jewelry, etc.)Services/otherWellness (weight loss products, vitamins, etc.)Leisure/educational (books, videos, toys, etc.)32.029.415.415.37.9Percent of Sales by Location/MediumFace-to-face sellingIn the homeIn the work placeAt a temporary location (fair, exhibition, etc.)Other locations (salesperson’s office, etc.)Remote sellingPhoneInternet (World Wide Web, e-mail)Other (mail, fax, etc.)73.161.96.73.90.626.915.610.80.5Percent of Sales by Census cent of Sales by Sales StrategyIndividual/person-to-personParty plan/groupCustomer placing order directly with firm(in follow -up to a prior face-to-face solicitation)OtherCompensation Structure(Multilevel vs. single level)Percent of firmsPercent of sales dollarsPercent of salespeople2003 U.S. Salespeople3025 24.54 25.57 26.69199920002001 28.6999.90.1Percent of Salespeople by Distributorship TypeOne-person distributorship--female71.9One-person distributorship--male16.7Two-person distributorship10.3Multi-person distributorship1.1Percent of Salespeople by Hours WorkedFewer than 30 hours per week85.130-39 hours per week7.640 hours or more per week7.3Percent of Salespeople by GenderFemaleMale79.920.169.028.51.70.8U.S. Salesforce Size (Mil) 29.551412108642020151050200213.3 MillionPercent of Salespeople by Work StatusIndependent contractorsEmployeesU.S. Retail Sales ( 00012.2200113.013.320022003For further information contact Amy Robinson, director-communications & media relations, or Eileen Creamer O’Neill,DIRECT SELLING ASSOCIATION 1275 Pennsylvania Avenue, NW, Suite 800, Washington, DC 20004-2411Phone: 202/347-8866 Fax: 202/347-0055 E-mail: [email protected] Website: www.dsa.org

Appendix CComments of the Direct Selling Association on theFTC Trade Regulation Rule on Disclosure Requirements andProhibitions Concerning Franchising and Business OpportunityVentures (April 7, 1995 and February 28, 1997)

TABLE OF CONTENTSI.Introduction . 1I1.Response to Request for Comments .2A.General Comments on the Rule (Questions 1.4, 6). 2B.Application of the Franchise Rule to Business Opportunities(Questions 9-16) .1.General Comments (Questions 9-12) . 32.Franchises and Business Opportunities Should be DefinedDifferently. and Any Business Opportunity Definition ShouldFollow State Laws in this Area (Question 13). 33.The Franchise Rule Covering Business Opportunities. or aBusiness Opportunity Rule Should n o t ' e c i f i c aIncludell Multilevel Marketing (Question 13(b)). 5.The Required Payments Threshold Should be Increased to 1000 .64C.D.3Earnings Information (Questions 19-39).61.Background (Questions 19-28). 62.Possible Required Earnings Disclosures (Questions 29-39) . 7Possible Exemptions and Special Circumstances (Questions 40-45) . 71.The Commission Should Adopt a Safe-Harbor for ThoseCompanies that Provide a Buyback Guarantee. 7

I.INTRODUCTIONTrus Comment of the Direct Selling Association ("DSA") is in response to the Request forComment Concerning the Trade Regulation Rule on Disclosure Requirements and ProhbitionsConcerning Franchising and Business Opportunity ventures' ("Request for Comments").DSA is the national trade association representing over 150 companies w h c h sell their productsand services by personal presentation and demonstration, primarily in the home. Our membershp,with 6.2 million l r e c t sellers, includes some of the nation's most well-known commercial nameswhch constitute 95% of all direct selling in the United States. The home party and person-toperson sales methods used by our companies and their independent contractor salesforces havebecome an integral part of the American landscape.The typical inlvidual direct seller is a woman who operates her own business part-time from herhome. Her financial goals are simple -- to earn enough extra income for gifts, tuition, or familyvacation -- in short, to supplement family income. The direct seller, as a. micro-entrepreneur, is thequintessential small business person.2DSA believes that franchises and business opportunities are very different and these differencesshould be recognized by the Federal Trade Commission ('.FTCV or " ornmission"). Therefore,DSA's Comments are limited to the Trade Regulation Rule on Disclosure Requirements andProhbitions Concerning Franchising and Business Opportunity Ventures3 (the "Franchse Rule")as it relates to business opportunities, not franchises.DSA strongly supports consumer awareness in all transactions, including business opportunities.In fact, the Direct Selling Education Foundation ("DSEF") produces and distributes a number ofconsumer brochures including "Promises, Check 'em Out! Business Opportunity r a u d . " ' Thisbrochure, originally published in cooperation with the National District Attorneys Association'sEconomic Crime Project, is designed to better the decision-making of consumers when entering intoa new business. Further, DSA is a proud supporter of many national consumer organizations anda strong promoter of the hghest standards of business conduct in the direct selling industry. TheDSA Code of Ethics has been widely praised by the law enforcement and consumer protectioncommunities.DSA and several of its member companies, including Amway Corporation, Avon Products andMary Kay Cosmetics commented during the rulemalung process of the Franchse Rule in 1978 andduring periodic reviews of the rule. Although direct selling is neither a franchse nor a businessopportunity, DSA takes an interest in rules concerning such for several reasons. First, the offeringof a dlrect selling opportunity (the paying of money to start a business), assuming it crossed at r i g g e gdollar amount, could be considered a business opportunity by law enforcement. Second,I60 Fed. Reg. 17,636 (April 7, 1995).' A profile of a typical direct seller is attached as Appendix I.A more detailed discussion of these differences is located Infra,at 3-5.16 C.F.R Part 436.5See.Appendix 11. The DSEF brochure entitled "Pyramid Schemes: Not What They Seem!" was-.prepared in cooperation with the FTC.14

because a franchise and a business opportunity are quite different and yet easily confused, DSAwould welcome the divorce of business opportunity regulation from the Franchse Rule through aseparate definition of a business opportunity.In the direct selling industry, sellers enter into a contract with a direct selling company giving theseller the right to sell that company's products or services. The relationshp of a direct seller to adirect selling company is that of an independent contractor6 who is not subject to the control ordirection of the company. Upon sigmng the distributor agreement, some direct selling companieswill give an option to a direct seller to purchase a start-up lut, w h l e other companies require theseller to purchase a start-up lut. These start-up luts typically contain some product samples,promotional literature, and similar materials. Approximately 75% of all DSA members' sales lutscost less then 100, and nearly 85% of all members' sales luts cost under 200. DSA is not awareof any member company sales kit that costs over 500. Rarely, if ever, are these sales luts sold ata profit to the direct selling company.As in many areas of commerce, the possibility of fraud will always exist in the offering of businessopportunities. The Federal Trade Commission must take great care in regulating such activities toensure that its rules truly separate the wheat from the chaff, and do not impose burdensomeregulations on legitimate businesses. includins honest direct sellini companies.11.Response to Request for CommentsA.General Comments on the Rule (Questions 1-4, 6)DSA believes that fianchses and business opportunities are very different and the overlappingd e b t i o n of a "franchse" is unnecessary and subject to confusion. Because of the differencesbetween the two marketing methods, DSA's Comments are limited to the Franchise Rule as itrelates to business opportunities, not franchises.The Franchise Rule, through the promotion of certain standards of conduct benefits consumers,law enforcers, and the business community. The Franchse Rule sets forth a general course ofconduct for all in the business opportunity marketplace. Further, when a consumer has a good dealof money to risk, he or she has an affirmative obligation to investigate and evaluate that risk.Because a consumer may not have ready access to dormation such as business experience, andlitigation and bankruptcy hstory, disclosures on the part of the offeror become important.26 U.S.C. tj 3508 (1986).

B.Application of the Franchise Rule to Business Opportunities (Questions 9-16)1.General Comments (Questions 9-12)The Franchse Rule provides important protection to those who enter into a business opportunityand risk a significant sum of money. As the Commission knows, the disclosure burdens containedin the Franchse Rule would be unnecessary for consumers and inordinately burdensome forofferors in situations where the money at risk is minimal.'2.Franchises and Business Opportunities Should b e Defined Differently,and Any Business Opportunity Definition Should Follow State Lawsin this Area (Question 13).The Request for Comments notes that in the Franchise Rule there is no definition of a "businessopportunity" and acknowledges that a business opportunity is defined as a "franchse".' However,franchises and business opportunities are not the same, and the list below highlights some of themany differences between the two marketing methods'.Franchisees are often required to make a significa

Internatio nal, LP Aerus LLC (formerly Electrolux LLC) Internet Services, Telecommunications Services, Utilities Health/Fitness/Wellness, Nutritional Supplements, . Oral Hygiene, Personal Care, Skincare, Weight Management The Fuller Brush Company Homecare, House and Kitchenwares, Personal Care Gano Excel USA, Inc.