Archive for April, 2008

Word has spread quickly about directselling411.com! After just a few short days with our “doors” open to the public, the buzz is beginning.

A quick Google search today uncovered a blog post questioning not only the motivations behind this site, but also the Direct Selling Association’s credibility. I think the directselling411.com mission has been made very clear – to provide accurate information about direct selling, as well as a forum for dialogue about direct selling. Don’t agree with the information provided? Then let’s talk about it. There aren’t many other sites about direct selling out there that provide a two-way street for the dialogue. It’s fine if, in the end, you disagree with the information on the site, but at least engage in the conversation.

I’ll be the first to admit that the direct selling industry is not without its issues – if it were perfect you wouldn’t be reading this blog. But contrary to what industry critics would have you believe, the vast majority of participants in this industry are honest, ethical human beings.

The part most critics choose to ignore is that the good guys are working hard to address the industry’s issues – as well as change outdated stereotypes kept alive only through the misinformation spread by those who refuse to understand direct selling is an honorable and time-tested method of product distribution that helps millions of people achieve their goals.

Do the good guys ever err? Of course – that’s one of the reasons the Direct Selling Association’s Code of Ethics, enforced by an independent Code Administrator, is a great consumer protection vehicle. Anyone who has encountered a problem with a DSA member company is invited and encouraged to file a Code complaint. Complain to your friend or neighbor if you choose, but to get a resolution, file a Code complaint. DSA member companies are required to resolve all issues to the satisfaction of the Code Administrator – their membership depends on it.

I was hoping this post wouldn’t get too long, but quickly I want to respond to some of the specific statements from the aforementioned post.

1. “Most of the direct selling that is done by direct selling companies are to their distributors.” FALSE! What’s true is that more than 50% of Americans have purchased through direct selling in the past year. In addition, there are a significant number of people who sign up only to purchase the products at a discount – they never intend to sell a single thing (or make a single dollar for that matter!). Some companies have a fairly high percentage of people in this category – often called discount buyers. However, certainly anyone reading this post knows more than a handful of people with kitchens outfitted with direct selling products, homes accented with direct selling products and even jewelry boxes, well, you know…
2. “In past years the FTC has taken a dim view of [sales made to participants in the plan, a.k.a. internal consumption].” FALSE! While the FTC maintains an interest in making sure bad actors do not use internal consumption as a cover for inventory loading, and has looked closely at this issue with regard to specific companies (and in some cases has imposed requirements specific to those companies based on their findings), there is no FTC rule regarding internal consumption. In fact, in a 2004 staff advisory opinion, the FTC specifically states that the amount of internal consumption does not determine whether a plan is illegal; such a determination is instead dependent on the source of funds for commissions.
3.  “The DSA operates to keep direct selling businesses in business.” TRUE! That’s the nature of a trade association. But what’s also true is that DSA helps keep its companies in business by making sure they operate in a legal and ethical manner. And through the work of the Direct Selling Education Foundation (DSEF), direct sellers work with consumer protection groups around the world to advance the rights of consumers everywhere. (Incidentally, the post in question also asserts “the DSA probably manages to put mucho cashola in Senate and Congressional pockets very effectively.” Anyone who believes legislators and regulators are influenced by DSA’s money vs. being on the right side of the issue should check here to get the real picture.)

The bottom line is this:

Anyone who asserts DSA is doing anything that is not open and honest clearly hasn’t spent too much time on this site. The facts are here for all to see – with an invitation to comment. Sure, we can be accused of “whitewashing MLM,” making an “attempt to paint [the] business with respectability,” and “treating the public like small children,” but in the end, DSA’s goal is to make sure all direct selling companies are operating ethically and fairly. I would encourage those who share this goal to work with DSA to improve the industry.

I like Miss Manners because she is straight and to the point about a lot of topics people spend a lot of time stewing about. I don’t always agree with her ultimate nugget of wisdom, but rarely can I fault her direct approach.

In her column today (scroll down to the second question/answer) she responds to a reader who wishes to decline an invitation for a home party. I applaud Miss Manners for asserting that one can feel free to say “I’m not interested,” and decline the invitation – it really is just that simple. No need to make up excuses – just decline.

However, Miss Manners (and the inquirer) errs when she assumes the hostess is only extending the invitation because she wants the friend’s business. In this case, the hostess and invitee were not close acquaintances – I say having a casual get-together at one’s home is an excellent opportunity to make an invitation to someone with whom you may not have the occasion to arrange an exclusive afternoon. There is no harm in inviting distant acquaintances to such a gathering – in fact it might be just the chance to further solidify the relationship based on shared interests. The opportunity to peruse and purchase products is only an added feature to what is otherwise a chance to catch up with old friends and make new ones.

If Miss Manners truly believed the earlier advice she had given about not feeling obligated to purchase anything, she would have counseled today’s inquirer to evaluate the invitation based on interest in socializing with the other attendees. Based on that, the inquirer would have had no trouble enjoying her afternoon and feeling guilt-free about walking away empty-handed (or staying at home alone).

I find shopping with friends to be quite enjoyable – no matter the venue. When I go to the mall with a friend I do not feel obligated to purchase anything. Likewise, I would not feel obligated to purchase anything at a home party. The problem in both cases is I usually find several things I just can’t live without.

Miss Manners, in the future, please consider that for some, shopping and socializing go hand in hand. Continue with your advice to be upfront and honest, but please don’t assume invitations to home parties are anything other than an open door.