Watch the video to see what expert MLM Attorney Jeff Babener has to say.

The word “opportunity” is a generic term for the chance to advance, better one’s economic state, health, social position.

However, in the context of direct selling, “opportunity”, in addition to the chance to make money, is a reference to the “business opportunity” of a direct selling/MLM marketing program. Two dozen states and the FTC regulate the offering of business opportunities in a parallel fashion to their regulation of franchise opportunities. Because of the low threshold of entry fees, typically, modestly-priced at-cost sales kits, the business opportunity of MLM companies is generally exempt from state business opportunity laws.

In addition, the FTC has indicated that it generally does not view the offering of an MLM opportunity to trigger the FTC Business Opportunity Rule. Of course, multiple states have adopted specific MLM statutes to provide guidelines for the offering of a MLM opportunity. All of these statutes can be found in the statutes library at our website.

MLMLegal.com is bustling with educational content for direct sellers and startup/existing MLM companies! Be sure to visit us often!

If you are interested in attending the Starting and Running the Successful MLM Company conference visit our conference page, view our speaker list, or get more details. All executives/owners of direct selling companies are welcome to attend. Call 800-231-2162 to register.

If you’re reading this blog post and the conference dates above have passed, check our website for the current conference dates.

Sign up for the MLM News Global newsletter for top headlines, news stories, scam alerts, videos, articles, and more information on the network marketing industry.

Visit us at www.mlmlegal.com to learn more.

A good MLM company, seeking longevity in the marketplace, will put a lot of effort into training their distributors on how to manage and build their business. Businesses will provide online training, event training, and incentives.

Not every MLM company has the same opportunity, or compensation plan. There are many types of compensation plans and many variations on the original compensation plans (stairstep, unilevel, breakaway, matrix, binary). Each compensation plan and MLM company is unique in how it approaches consultant training.

Regardless of what compensation plan you’re using, there are common distributor training techniques among all companies and compensation plans. From a legal perspective, MLM companies must be realistic about their distributors’ statistics for success. It is not easy to become a MLM multimillionaire. Only a small percentage of distributors achieve such high success. Therefore, when legitimate direct selling companies present their training, management and support programs to encourage and train distributors they use some (or all) of the techniques in the list below.

If distributor training in your company sounds a little like this list, then it is likely looking good from a legal perspective. A MLM company opportunity should prioritize some or most of the following:

1. Enhance distributors’ self-image.
2. Enhance the image of the network marketing industry as a whole.
3. Educate distributors about the direct selling, MLM industry.
4. Create a realistic picture of what it takes to succeed in operating a network marketing business.
5. Help distributors understand the responsibility of being in business for themselves.
6. Make product education paramount in training programs.
7. Develop business management skills.
8. Help consultants understand the dynamics of people-interaction or person-to-person relationships.
9. Teach (or encourage the learning of) new business technology application to the business, such as computer software programs and website platforms.
10. Help distributors understand the basic concepts behind the network marketing method of distribution.
11. Create an appreciation of ethical standards.
12. Teach distributors how to run a small business, such as managing taxes, distributor networks and accounting.
13. Work on goal-setting and planning; develop one, two, and three plans, rather than promote unrealistic instant success schemes.
14. Develop the art of prospecting (finding and recruiting new distributors for your downline).
15. Help distributors understand the concept of commitment.
16. Learn to value the contribution of others in their home business.
17. Prepare to give effective presentations.
18. Learn how to deal with objections, rejections, and discouragement; helping distributors understand that an objection is nothing more than a question in disguise.
19. Develop an understanding of the legal issues impacting the network marketing industry and the individual distributor business owner.
20. Help distributors understand the art of duplication and the power of setting an example (in recruiting).
21. Help consultants understand that people are involved in network marketing for different reasons; allow those who are interested in the business opportunity to develop at their own pace and resist the urge to pressure satisfied consumers to engage in the business opportunity if they simply want to remain customers.

When MLM companies work to encourage their distributors to work hard, learn about the business, and have realistic expectations, then they are working to support a network of distributors that will last a long time.

If a direct selling company tells you that you’ll become a millionaire in a month then the chances are likely that they are not operating a legitimate business. Remember, if it’s too good to be true, then get out quick!

Would you like to learn more about distributor training, legal MLM compensation plans, or the MLM industry in general? Watch some of MLMLegal.com’s videos, presented by MLM Attorney, Jeff Babener. Visit MLMLegal.com for the most trusted MLM legal information on the web.

Visit us at www.mlmlegal.com to learn more.

Because most leading companies offer terminating distributors a 100% or 90% buy back policy for inventory and mandatory sales materials (a full refund of your startup kit, e.g.), the risk of actually losing money is drastically diminished.

Many leading companies offer earnings disclosures that indicate the level of earnings of distributors. It is true that many distributors merely join to become discount buyers. And actually do not make money in the MLM program because they are not really pursuing the opportunity.

It is also true the vast majority of active distributors (those who actually make money) typically make no more than a few hundred dollars per month. There is a saying in the MLM industry that “95 percent of distributors fail or lose money.” This would not be viewed as a fair statement, unless one views, as worthless, the product/service purchased by distributors for personal or family use. Except for scam companies, this is not the case. Leading MLM companies are known for offering high quality products and desirable services.

What this related video: Why Do Distributors Join MLM Companies?

MLMLegal.com is bustling with educational content for direct sellers and startup/existing MLM companies! Be sure to visit us often!

If you are interested in attending the Starting and Running the Successful MLM Company conference visit our conference page, view our speaker list, or get more details. All executives/owners of direct selling companies are welcome to attend. Call 800-231-2162 to register.

Our next Starting and Running the Successful MLM Company Conference takes place October 27 and 28, 2016 in Las Vegas. View our conference flyer and speaker list online. Participate in our Innovation Campaign for your chance to receive TWO FREE TICKETS to attend our next conference.

If you’re reading this blog post and the conference dates above have passed, check our website for the current conference dates.

Sign up for the MLM News Global newsletter for top headlines, news stories, scam alerts, videos, articles, and more information on the network marketing industry.

Visit us at www.mlmlegal.com to learn more.

First, we must note that this is a bit out of our area. However, we have attended many such events and been involved in meeting planning from hotel logistics to program to meeting planners. And we have done this scores of times with many of the leading direct selling companies.
With that said, the point is that you are in a relationship business. All studies have shown that recruitment and retention have a direct correlation with how your distributors bond with management, leaders, corporate mission, and product. Obviously, a company will lead with the goal of rewarding distributors with recognition, providing good education on the product, opportunity and recruitment, inspiring them as to the past and future, demonstrating sincere appreciation and making sure they have a good time. This is “experiential bonding” and it is a company’s opportunity to showcase both objectively and emotionally why distributors should bond with management, other leaders, other fellow distributors, company product, the mission of the company and hopefully, if there is a philanthropic program, with the community “giveback” of the company.

If you are interested in attending the Starting and Running the Successful MLM Company conference visit our conference page, view our speaker list, or get more details. All executives/owners of direct selling companies are welcome to attend. Call 800-231-2162 to register.

Our next Starting and Running the Successful MLM Company Conference takes place February 25 & 26, 2016 in Las Vegas. View our conference flyer and speaker list online. Participate in our Innovation Campaign for your chance to receive TWO FREE TICKETS to attend our next conference.

If you’re reading this blog post and the conference dates above have passed, check our website for the current conference dates.

Sign up for the MLM News Global newsletter for top headlines, news stories, scam alerts, videos, articles, and more information on the network marketing industry.

Visit us at www.mlmlegal.com to learn more.

The largest direct sales markets globally include the United States (19% of global sales), followed by China (17% of global sales), Japan (9% of global sales), Korea (9% of global sales), and Brazil (7% of global sales), totaling just over 60% of global sales.

To summarize some of the statistics, the number of direct sellers rose globally to 100 million, up 3.4% from 2013.

Independent business owners worldwide join the direct selling salesforce for many reasons; to earn extra part-time income at home, to learn new skills and build self-esteem, to fight for a social cause, and to make new friends. The press release reports that most independent distributors started out as customers, and in many cases, joined the opportunity to receive a discount on products, not necessarily to sell to others.

Industry retail sales hit record highs, the press release reports, saying, “Retail sales rose 6.4% to US$182.8 billion in 2014. So the steady growth curve in Direct Selling continues, now with a 3-year compound annual growth rate of 6.5% for the period from 2011-2014.”

The largest direct sales markets globally include the United States (19% of global sales), followed by China (17% of global sales), Japan (9% of global sales), Korea (9% of global sales), and Brazil (7% of global sales), totaling just over 60% of global sales.

Read the full press release.

Learn more about the network marketing business at www.mlmlegal.com and www.mlmattorney.com.

If you are interested in attending the Starting and Running the Successful MLM Company conference visit our conference page, view our speaker list, or get more details. All executives/owners of direct selling companies are welcome to attend. Call 800-231-2162 to register.

Our next Starting and Running the Successful MLM Company Conference takes place October 22 and 23, 2015 in Las Vegas. View our conference flyer and speaker list online. Participate in our Innovation Campaign for your chance to receive TWO FREE TICKETS to attend our next conference.

If you’re reading this blog post and the conference dates above have passed, check our website for the current conference dates.

Visit us at www.mlmlegal.com to learn more.

In the context of direct selling, “opportunity,” in addition to the chance to make money, is a reference to the “business opportunity” of a direct selling/MLM marketing program.

The word “opportunity” is a generic term for the chance to advance, better one’s economic state, health, social position, etc. However, in the context of direct selling, “opportunity,” in addition to the chance to make money, is a reference to the “business opportunity” of a direct selling/MLM marketing program.

Two dozen states and the FTC regulate the offering of business opportunities in a parallel fashion to their regulation of franchise opportunities. Because of the low threshold of entry fees, typically, modestly-priced at-cost sales kits, the business opportunity of MLM companies is generally exempt from state business opportunity laws. In addition, the FTC has indicated that it generally does not view the offering of an MLM opportunity to trigger the FTC Business Opportunity Rule. Of course, multiple states have adopted specific MLM statutes to provide guidelines for the offering of a MLM opportunity. All of these statutes can be found in the statutes library at www.mlmlegal.com.

For more information on the network marketing industry visit www.mlmlegal.com and www.mlmattorney.com.

Find us on our social networks:

Google+

LinkedIn

Twitter

Facebook

Our next Starting and Running the Successful MLM Company Conference takes place October 27 and 28, 2016 in Las Vegas. Call 503-226-6600 or 800-231-2162 to register. If you’d like to see how you can get free tickets to the next MLM Startup Conference, visit our Innovation Campaign page.

Visit us at www.mlmlegal.com to learn more.

The FTC and most states under deceptive claims laws, prohibit unsubstantiated or misleading claims about products.

MLM companies and direct sellers are among the biggest sellers of health and cosmetics products in the world. Some of the largest companies are traded on the New York Stock Exchange (NYSE), such as Avon or Herbalife. Because of concerns about safety of its customers, as well as U.S. Food and Drug Administration (FDA) and Federal Trade Commission (FTC) regulatory scrutiny of labeling and product claims, MLM companies expend tremendous financial and professional resources to remain compliant with the rules promulgated by the FDA for the marketing of health, cosmetic and personal care products. The FDA publishes extensive guidelines for product claims. In the dietary supplement area, Congress has instructed the FDA on such guidelines with DSHEA, the Dietary Supplement Health Education Act of 1994. And, even with DSHEA exemptions for substantiated “structure function claims,” any claims in the nature of therapeutic treatment of actual medical conditions, are prohibited. And if such claims are made, the products may be removed from the over the counter market as unapproved “drugs.” In addition, the FTC and most states under deceptive claims laws, prohibit unsubstantiated or misleading claims about products. MLM companies, in turn, publish extensive compliance guidelines for distributors as to what may be represented or prohibited by way of “unauthorized product claims” in the marketing of products. Companies take this issue quite seriously, as inappropriate product claims that trigger regulatory action create a risk for the opportunities of all distributors as well as companies.  

View these related articles:

What Are Unauthorized Earnings Claims?

As a consultant, what can I say about a MLM company’s nutritional/dietary supplement products?

For more information on the network marketing industry visit www.mlmlegal.com and www.mlmattorney.com.

Find us on our social networks:

Google+

LinkedIn

Twitter

Facebook

Our next Starting and Running the Successful MLM Company Conference takes place October 27 and 28, 2016 in Las Vegas. Call 503-226-6600 or 800-231-2162 to register. If you’d like to see how you can get free tickets to the next MLM Startup Conference, visit our Innovation Campaign page.

Visit us at www.mlmlegal.com to learn more.

The Tennessee language is similar to language adopted in more than a dozen state statutes, which recognizes personal use, so long as it is coupled with consumer safeguards to avoid inventory loading and to provide for a reasonable inventory repurchase policy. In 2014, the state of Tennessee adopted such a pyramid test:

(8) “Pyramid promotional scheme”:

(A) Means any plan or operation by which a participant gives consideration for the opportunity to receive compensation that is derived primarily from the introduction of other persons into the plan or operation rather than from the sale and consumption of goods, services, or intangible property by a participant or other persons introduced into the plan or operation; and

(B) Includes a plan or operation under which:

…. (ii) A participant, on giving any consideration, obtains any goods, services, or intangible property in addition to the right to receive compensation.

(C) Nothing in this part may be construed to prohibit a plan or operation, or to define a plan or operation as a pyramid promotional scheme, based on the fact that participants in the plan or operation give consideration in return for the right to receive compensation based upon purchases of goods, services, or intangible property by participants for personal use, consumption, or resale so long as the plan or operation does not promote or induce inventory loading and the plan or operation implements an appropriate inventory repurchase program.

(House Bill 2356 approved by the Governor, April 25, 2014 and effective July 1, 2014)

For the complete language of the new Tennessee legislation, visit the Tennessee Statute page located at MLMLegal.com’s MLM Law in 50 States section.

In the last 10 years, distributor personal use, as a legitimate end destination for product/service has been increasingly recognized by courts, legislatures and regulators:  In 2013 and 2014, two EU tribunals; now counting, more than a dozen U.S. states have amended MLM statutes; in 2004, an FTC advisory opinion applauded efficiencies of MLM “buying clubs”; even the most recent U.S. Ninth Circuit Court of Appeals decision, BurnLounge, recognized personal use purchases that were not merely incidental to the business opportunity. The emerging legal standard, legitimate vs. pyramid, is not the existence of personal use, but rather, whether the predominant motivation for distributor expenditure is to qualify for reward in the MLM program as opposed to purchase for personal use or resale.

Read Tennessee State Law at our website.

For more information on the network marketing industry visit www.mlmlegal.com and www.mlmattorney.com.

Find us on our social networks:

Google+

LinkedIn

Twitter

Facebook

Our next Starting and Running the Successful MLM Company Conference takes place May 15th & 16th, 2014 in Las Vegas. Call 503-226-6600 or 800-231-2162 to register. If you’d like to see how you can get free tickets to the next MLM Startup Conference, visit our Innovation Campaign page.

Visit us at www.mlmlegal.com to learn more.

All studies have shown that recruitment and retention have a direct correlation with how your distributors bond with management, leaders, corporate mission, and product.

First, we must note that this is a bit out of our area of legal expertise. However, we have attended many recognition events and been involved in meeting planning, from hotel logistics, to program, to meeting planners. And, we have been involved with these kinds of events scores of times with many of the leading direct selling companies.

With that said, the point is that you are in a relationship business. All studies have shown that recruitment and retention have a direct correlation with how your distributors bond with management, leaders, corporate mission, and product. Obviously, a company will lead with the goal of rewarding distributors with recognition, providing good education on the product, opportunity and recruitment, inspiring them as to the past and future, demonstrating sincere appreciation and making sure they have a good time. This is “experiential bonding” and it is a company’s opportunity to showcase both objectively and emotionally why distributors should bond with management, other leaders, other fellow distributors, company product, and mission of the company and hopefully, if there is a philanthropic program, with the community “giveback” of the company.

For more information on the network marketing industry visit www.mlmlegal.com and www.mlmattorney.com.

Find us on our social networks:

Google+

LinkedIn

Twitter

Facebook

Our next Starting and Running the Successful MLM Company Conference takes place October 27 and 28, 2016 in Las Vegas. Call 503-226-6600 or 800-231-2162 to register. If you’d like to see how you can get free tickets to the next MLM Startup Conference, visit our Innovation Campaign page.

Visit us at www.mlmlegal.com to learn more.

We have painstakingly researched each company’s history, impact on industry, products, compensation plan, and sales base.

At MLMLegal.com we have collected and summarized over 700 MLM company profiles. We have painstakingly researched each company’s history, impact on industry, products, compensation plan, and sales base. Here are 20 new companies that are newly added to MLMLegal.com:

NeverChase

Lyoness Corporation Worldwide

Verefina

Euphoria Gems Parties

Le-Vel Brands, LLC

Healthy Habits Global

ZU International

bathologie

Epic

Living Fresh Collection

BrainAbundance.com

MIALISIA

In A Pikle

Fleur de Vie

Vessel Scents of Style

mixoloseum

Nutrie, LLC

FunkyWoman.com

Jewelry In Candles

A JAMAIS

Editor’s Note:
Welcome to MLMLegal.Com Company Profiles at www.mlmlegal.com. Here you will find brief summaries of pertinent information about hundreds of MLM, Direct Selling, Direct Sales, Network Marketing and Party Plan Companies (via james). As a general matter, the summary information is derived from Company published information, generally posted at Company websites, public information releases or posts at industry trade sites.*

Visit our MLM Company Profiles Page to read about hundreds of direct selling companies.

For more information on the network marketing industry visit www.mlmlegal.com and www.mlmattorney.com.

Find us on our social networks:

Google+

LinkedIn

Twitter

Facebook

Our next Starting and Running the Successful MLM Company Conference takes place May 15th & 16th, 2014 in Las Vegas. Call 503-226-6600 or 800-231-2162 to register. If you’d like to see how you can get free tickets to the next MLM Startup Conference, visit our Innovation Campaign page.

Visit us at www.mlmlegal.com to learn more.