A Conversation with Jeff Babener Video Series: Know of an illegal pyramid scheme operating as a legitimate/legal MLM? Where do you go to report it? Are there regulatory agencies that accept reports of pyramid schemes? Trade associations, like the DSA, can help you determine if a company is legal or not. Check the Better Business Bureau. Do MLM companies have to register their company as a legal operation? Talk to other distributors in the company and in the industry. Does the company have competent legal representation? A startup without legal representation is not looking after their legal affairs. Watch the video.

For more information, visit mlmlegal.com.

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

© 2018 by Jeffrey A Babener
(First Published in World of Direct Selling)

The future ain’t what it used to be.

Yogi Berra

Or maybe it is. In ancient Egypt the pharaohs placed a general tax on the sale of all commodities at the rate of 5% of sale price.  The Romans obviously thought this was a good idea and, after their conquest of Egypt, the rate rose to 10%.  For the next 2,000 years, to this day, bureaucrats have found sales tax a favorite revenue raiser.

The Bombshell… Deja vu, all over again.

In South Dakota v. Wayfair, Inc. June 21, 2018. Slip Opinion 17-494, 585 U.S. ____ (2018). The U.S. Supreme Court overturned a 50 year old precedent on how states can tax sales by out-of-state retailers, holding that its earlier 1967 and 1992 decisions were wrong, and that it needed to rectify its mistake to reflect the economic reality of today’s interstate commerce to prevent discrimination against local brick and mortar retailers that favored online out-of-state retailers. Effectively, it abandoned a decades old bright line analysis that the “physical presence” nexus that justified states to impair interstate commerce, in violation of the Commerce clause of the Constitution was being replaced by a more “amorphous” standard of an “economic reality” impact of out-of-state sellers in states that sought to impose sales and use taxes.

Impact and Response to this “missile” on contact:

For most online sellers: a thermonuclear explosion…life will never be the same.

(Keep in mind that one of the largest online sellers, Amazon, recognized the future, and had already undertaken to collect sales tax in the 45 states that impose sales/use taxes, although most of its third party vendors have not.)

For direct sellers, who sell both online and offline:

More like momentary eclipse of the sun…back to business; they have already been collecting and paying sales/use tax for decades.

Actually, says direct selling, “thank you for leveling the playing field.”

And, as to all online sellers, whether direct sellers or not, “no thank you” long term for an expected flood of creative new state taxes that will develop over the next 20 years in our “virtual and gig” economy. This is just the beginning.

First, What Just Happened?

As summarized by the Court in its syllabus and majority and dissenting opinions:

Wayfair is a major online retailer of home furnishings. Although it has substantial sales into South Dakota, it has no physical presence in South Dakota. Until the Wayfair case, 50 years of court precedent prevented states from impairing interstate commerce, in violation of Commerce Clause, U.S. Const. art. I, § 8, cl. 3, by imposing a duty on out-of-state retailers who had no “nexus” with the state. And for the Supreme Court, “nexus” required physical presence. Two famous cases set the bright line mandate of physical presence: National Bellas Hess, Inc. v. Department of Revenue of Ill., 386 U.S. 753 (1967), and Quill Corp. v. North Dakota, 504 U.S. 298 (1992). Both National Bellas Hess and Quill involved interstate shipment from products ordered from catalogs.

It is estimated that these two cases caused South Dakota to miss out on $48 million to $58 million annually. And so, like many states, South Dakota sought to test the issue again, claiming that the Internet had changed things, i.e., we had a new economic reality of “nexus” that went beyond physical presence. Based on this half century standard, Wayfair refused to collect sales tax imposed by a relatively new South Dakota sales tax law that sought to impose sales tax responsibilities on out-of-state sellers who sold more than $100,000 in goods and services into the state or carried out more than 200 sales transactions.

Litigation followed, led by South Dakota requesting a declaratory judgment that its new tax was valid. Wayfair raised the long time defense of lack of “nexus” via physical presence. South Dakota lost at the trial court and State Supreme Court and requested review by the U.S. Supreme Court.

The states hit the jackpot. And it was the lucky day for the forty-one states, two Territories and the District of Columbia, all hungry for new taxes, who joined South Dakota to ask the U.S. Supreme Court to reject the test formulated in Quill. In 2017, the U.S. Government Accountability Office pegged the prospective increase to the states, if South Dakota won the Wayfair case, as being between $8 billion and $13 billion per year.

Read the full article here.

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

Interviewed by Robin Seymour.

A Conversation with Jeff Babener Video Series: A network marketing distributorship is an asset of a marriage. State law will determine what happens to your distributorship in the event of divorce. Watch the video. And to learn more visit www.mlmlegal.com.

Watch the video!

For more information on legal aspects of direct selling, visit MLMLegal.com.

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

It’s always a good idea as a MLM distributor to keep yourself encouraged and engaged in your career by participating in company-offered training events. Company training events are meant to enhance your sales skills and increase your motivation. Enthusiastic network marketing companies will offer their distributors tools and seminars to help you improve and grow your business. Many MLM companies offer training tools in an online, back-office environment, while others will host elaborate in-person events in select cities.

You can always find ways to improve your sales and business skills online, either through your company’s training materials or by performing your own online research. Articles, business and sales books, and blogs written by successful distributors are great places to start.

MLM company seminars are particularly encouraging for MLM distributors. At company events, you’ll be able to meet other like-minded, goal-oriented distributors who will inspire you. Networking at company training events will empower you to meet other distributors within the company.

When you attend a distributor recognition or training event, shake plenty of hands and ask a lot of questions. We suggest a few starter tips for networking at company-sponsored events:

• What is your motivation story? Successful distributors will share motivational stories and tips for successful selling and recruiting. Have you ever wondered how top distributors earn incomes in the $10,000, $50,000 or even $100,000 range? At your company’s training event, successful distributors will share their stories of how they became successful as MLM consultants.
• How do you use social media? There are top distributors who have mastered networking and sales through social media. Be sure to meet people who have creative ideas on how to use social networking sites, like Facebook and Twitter, to sell bucket-loads of products/services.
• Who do you sell to? Do you feel like you’ve exhausted your friends, family, neighbors, and acquaintances? Company events are a great place to hear the secrets of how top-earning distributors have reached outside of their social circle and sold to the rest of the world.
• Why are your customers eager to make purchases from you? It’s not magic, but tricks do exist in selling and creating memorable introductions to potential customers. Make sure to ask how top distributors are engaging with their customers. What makes them good at selling? Perhaps you too can learn a few tricks to help you in your business?

Try to attend as many company events as possible. Take advantage of these events, meet people, and soak in the knowledge offered by the company and its top distributors. A MLM company training event is the absolute best place to learn how to grow your own business. If at all possible, use these events to find yourself a mentor or sponsor who will support you in your sales goals and teach you how to sell, where to sell, and how to meet your sales goals.

Being around people who are pursuing similar goals can help you stay focused and work harder to attain professional success. MLM company events will help you get excited about what you’re doing, and give you the extra boost you need to set your goals a little higher than before.

And always, with hard work and dedication, you may find yourself mentoring new distributors or starting your own direct selling business some day!

MLMLegal.com is bursting 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.

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.

Want to learn more? Watch these videos by MLM expert attorney, Jeff Babener.

What Are the Most Important Things to Remember When You Host a Distributor Recognition Event?

If I’m a New Distributor Then Should I Focus My Selling In Areas Where Other Distributors Are Successful Or Should I Focus On Untouched Territory?

What Do I Do with Distributors Who Go Passive (for MLM Distributors)?

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

Because we are globally-connected, you are bound to become involved in long distance sponsoring.

Embrace the opportunity to recruit beyond your city walls. You never know if – in a city a thousand miles away – long-distance sponsorship will be your most productive downline.

Like everything else in this business (in life); however, there are right and wrong ways to go about long distance sponsoring.

In a Business Start-Ups magazine interview, a national developer and producer of marketing and training materials for MLM companies and distributors, notes that “a conscious game plan may make all the difference in effective long distance sponsoring.” The interviewee points out that the helter-skelter approach to sponsoring (“go wide and see where it goes”) won’t necessarily yield the best results for your time and effort. Using this approach, he says, people are told to sign up anyone “as long as they breathe.”

Like any other important financial decision, the interviewee goes on, give it thought. “Just because you know a guy in Ohio, doesn’t mean you should sign him up, particularly if he is going to do nothing in your organization but draw on your time.”

This approach may support a few heavy hitters at the top of a network marketing organization, but not the average distributor. The interviewee points out that the top people in a network organization always try to put active, motivated people on their organization.

Here are 10 tips to help you when it’s time to cash-in on long distance sponsorship:

1) Know your craft: Before you start sponsoring long distance, make sure that you’ve mastered sales and recruiting in your own locality. The interviewee advises, “Know what you are doing and what you are going to teach.” Be a deal closer!

2) Choose wisely: If you want to increase your chances of success in long distance sponsoring, look for people who are “wired to win;” independent people with a track record of success. In fact, the further the distance, the more independent and reliable that person must be. The interviewee parallels the long distance sponsoring relationship to that of a long distance romance, saying, “If I am in LA, can I have a successful romance with someone in NY? Perhaps if I choose wisely.”

3) Create a system: You should start off with a comprehensive plan of attack and communicate it to your downline distributors so that you are all singing from the same song sheet. This is best accomplished at the beginning of the relationship by emailing them your proposed plan of attack.

4) Agree on responsive commitments: When you first establish relationships with long distance recruits, take some time to qualify the candidates. You need to talk to them, says the interviewee, and determine what they want, how much they are willing to commit in time, money and resources, and in what timeframe. Although you are all operating independent businesses, you are somewhat dependent on one another. Once you find the right person, develop an agreement that details your respective commitments – at the very least – in an email dedicated to the subject of business goals and plans.

5) Establish a long distance sponsoring budget: You have to spend money to make money. Long distance sponsoring is going to create expenses you don’t normally have when you sponsor distributors locally. To determine whether it will pay off for you, you’d better understand the costs involved. The first obvious expense is of calling charges and data rates on phone plans that don’t have unlimited data. Are you going to be mailing support materials to downline distributors? Plan on postage and mailing expenses for communication and shipping expenses for support materials. Are you planning on flying out to meet your downline or join an event? Plan a travel budget to support your downline group. This is obvious, but must be mentioned anyway: Make use of free technology (email, Skype, messaging services, etc.) to cut down on your long distance communication expenses.

6) Get some support from your company: If it looks like long distance sponsoring will be a real winner for you, you should take a close look at the multilevel marketing company you are working for to see if it has systems that will work to support your efforts. These may include voice messaging systems, national conference call service, digital communications and documents, email services, distributor website, as well as engaging materials to support retailing and team building.

7) Make sure the company training program supports long distance growth: Although this has been a problem in the past for some network marketing companies, many MLM companies today are developing new systems to support essential training for long distance recruits. Just take a look at their marketing materials.

8) Build your downline in geographical areas supported by your company: When you build your organization long distance, try to build in areas where the company is supporting growth through tours, rallies, events, and training. It’s much easier (and less expensive) to arrange meetings if most everyone in your downline is located around the same regional area.

9) Focus on areas where other successful distributors are located: Geographical areas where there is an infrastructure of successful distributors should be your first focus. It is particularly helpful if you can develop a reciprocal relationship where you support distributors of long distance recruits in your city in exchange for your distributors being supported by successful leader outside your city.

10) Provide the personal touch: The interviewee suggests that “training is everything and three-way calling is the name of the game in long distance sponsoring.” Be sure that you are on the phone with the first 10 contacts your new, long-distance distributor calls. This bonds potential customers to your organization from the very beginning. And also – when your distributors contact their potential customers – your new recruit will have the opportunity to listen to your presentation, gather information, learn how to overcome resistance, learn how to close the sale, and begin to build their own successful business.

In network marketing, long distance sponsoring opens a world of opportunity. If you’re willing to do it right, it can be an extremely profitable world. Remember, it takes time. It take a lot of effort and patience. And, above all, it takes determination.

Learn more about recruiting from Attorney Jeff Babener!

What is the benefit of recruiting experienced distributors? Video!

What’s the difference between sponsoring and recruiting? Video!

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

Here are some ways which you can investigate a MLM company:

1) Check to see if it is a member of any industry associations, like the DSA or DSWA.

2) Call your state’s attorney general’s office or consumer protection division. Most states regulate direct selling companies through these agencies.

3) Check with the Better Business Bureau.

4) You can check the company’s financial information (especially if they are publicly traded – corporate reports are available from online services) by accessing a credit reporting service, like Dun & Bradstreet.

5) Ask your sponsor (or potential sponsors) for the names and numbers of some other distributors. Check the company’s references just as you would check a job applicant’s references.

6) Attend one of the company’s training seminars to see how the company operates first hand.

7) Check industry trade publications for any information on the company, like Entrepreneur magazine.

8 ) Many times the company’s products will be regulated by government agencies, like the FDA. You can check the credibility of the products in some cases by contacting such government agencies.

9) Do some digging: gather as much information from the company itself, like the number of years they’ve been in business, the number of distributors they have, what countries they operate in, etc. This information will give you an idea as to the company’s credibility. A good source for this information is available here.

Checking a company’s legitimacy can be time consuming but highly beneficial in the long term.

Information about pyramid schemes is available here.

And if you are wondering how to make sure that the direct selling company that you’re starting is not an unintentional pyramid scheme, be sure to contact us for your free legal consultation: 503-226-6600 or www.mlmlegal.com.

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.

Have you seen or heard a direct selling company say something like, “Make $10,000 a month!” or “Guaranteed income of $2,000 weekly!”? Well, these are a couple of examples of unauthorized earnings claims. So, what is legal to tell your distributors about how much income they’ll make? Read (or watch!) what expert MLM Attorney Jeff Babener has to say in this video:

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 NYSE. Because of concerns about safety of its customers, as well as FDA and FTC regulatory scrutiny of labeling and product claims, MLM companies expend tremendous financial and professional resources to remain compliant with rules promulgated by the FDA for 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.

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.

Our last conference boasted 71 companies from 23 states and 8 countries, including Canada, United States, Ghana, Israel, Spain, Russia, China, and Germany!

(PRWEB)March 24, 2016

The Starting and Running the Successful MLM Company conference will be held May 20, 2016.

For more than 30 years, leading industry experts have educated the executives of starting and existing MLM, direct selling, network marketing, and party plan companies on how to structure their compensation plans, legalize their companies, recruit key employees and top-ranking distributors, develop business models, generate leads, fund their business, establish their website and technology platforms, better understand the direct selling industry, and so much more.

Did you miss the last MLM Startup Conference? In attendance were over 100 people, representing 71 companies from 23 states and 8 countries (Canada, United States, Ghana, Israel, Russia, Spain, China, and Germany). The companies in attendance represented the entire spectrum of company development, from startups to established companies. All attendees registered for our conference in order to learn more about the network marketing industry, grow their companies, meet experts in the industry, and educate themselves on the MLM industry.

The next MLM Startup Conference takes place May 20, 2016 in Las Vegas. View the conference flyer page at http://www.mlmlegal.com/srs2.html to learn more.

This is the original MLM Startup Conference — responsible for launching many industry-leading companies — perfected over the course of a quarter of a century to ensure the highest quality of information, most knowledgeable experts, and most practical advice from qualified experts.

Join us May 20, 2016 at our next conference! Over the course of the day, attendees will hear from a multitude of the best industry experts, and if they choose, can sign up to meet with the speakers for individual one-on-one time. A full list of speakers and their biographies/credentials can be found at http://www.mlmlegal.com/bio.html.

The educational information gained by attending this event is invaluable. Here are just a few of the testimonials from past attendees:

“We have a traditional business at the moment and we are looking to take it into the realm where it’s more personalized, it’s more about building people and an experience. It has been absolutely worth our trip. We are looking to take our business to the next level and build relationships.”

“The reason I came to the show was to learn more about how to launch my direct sales company. I’m very comfortable and accustomed to selling through more traditional networks; however, I believe that the product that I’m launching is more suitable for direct sales; to get direct-to-consumer faster and in greater sales.”

“[I’ve] been in network marking for 30 years [but] we are learning a lot of things about how to launch, how to reach the people we need to have, and again, the things that are required to make a successful company, not only for us but especially for our customers and for our affiliates.”

Each attendee will receive a free copy of the Starting and Running the Successful MLM Company Manual.

How do you find out more information?

Visit our website:
http://www.mlmlegal.com

Visit our blogs:
http://mlmlegal.com/MLMBlog/
http://www.mlmattorney.com/blog/

Watch the Conference Videos or many of the other educational MLM Videos!

• MLMlegal Releases New Film on MLM Startup Conference — Produced by Networkingstar.com
• The MLM Startup Conference in Las Vegas
• MLM Startup Conference — A Must for Executives of Startup and Existing MLM Companies
• Since You Are a MLM Attorney, Why Would You Host the MLM Startup Conference for the Executives of Startup and Existing Companies?

Contact Us: Register Today, 503-226-6600 or 800-231-2162

The day will begin at 9:00AM and end at 5:30PM, then from 5:30PM-8:30PM there will be one-on-one time with the speakers. For more information, visit: http://www.mlmlegal.com/srs2.html or call 800-231-2162/503-226-6600. Registrations are taken exclusively by phone and questions are always welcome.

Presented by one of the most trusted individuals in direct selling and MLM, Jeffrey Babener, Editor of MLMLegal.com.

About Attorney Jeffrey Babener: Conference Host and Chairman, Editor of MLMLegal.com, as well as the leading direct selling attorney in the United States – With over 30 years of experience as a direct selling attorney, Jeffrey Babener has advised leading companies in the MLM/Direct Selling industry, ranging from Avon to Nikken, to Herbalife, to Melaleuca, to USANA, and to Excel Communications, Nerium International, plus many more. He’s been published in national magazines such as Money, Inc., Atlantic Monthly, Entrepreneur magazine, Direct Selling News, Direct Sales Journal, Success magazine, Money Maker’s Monthly, among countless others. He’s authored several books, including his most popular Network Marketing: What you should know. Mr. Babener has chaired more than 70 national conferences on direct selling.

Lastly, learn how you can receive two free tickets to attend the October 2015 Starting and Running the Successful MLM Company Conference by visiting our Innovation Campaign page.

View the press release at PR Web.

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

Our huge newsletter subscriber list of MLM independent consultants will enjoy this week’s video that discusses ‘How Many People Would I Need in My Organization to Make Over $10,000?’ Expert Business Consultant and MLM Attorney Jeff Babener answer this question. Do you know enough people to make $10,000 in your company downline? Watch this video to find out!

The company profiled in this week’s newsletter is Princess House, Inc. The Princess House started in 1963 selling crystals, but today offers a diverse array of products. Read more about this MLM company in this week’s newsletter archive.

Like all other weeks, there is the latest scam news as well. Check out the company names popping up on MLM scam alert sites:

• BeOnPush Review: $20-$10,000 investment pack Ponzi
• uFlip Review: Canadian real estate projects?
• Zeek victims to pay $35,000 towards winner’s defense
• Lyconet Customer Cloud = €1500 unregistered securities?
• Private Access Online Review: G1E travel opp?
• WCM777 Victim Claims Portal open
• FTC reply to Vemma’s preliminary injunction objections

What else is new in the direct selling industry this week? Check out all the top news stories that you are missing by not getting our newsletter in your inbox! Check out MLM News Global and sign up for our free e-newsletter! Cancel at any time. NO SPAM!

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.

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.