This is the second installment in our training series on compliance. The first article covered what we’ve called “Side 1” of compliance: Product Benefits. Now, in this second article, we will focus on Side 2: The Income Opportunity.
These two sides of compliance are the twin pillars of product and opportunity precisely because they are what drive your ASEA business. The purpose of our compliance guidelines, and this training, is not to limit your ability to sell or recruit. Rather, their purpose is to allow you to build a business with less risk and greater longevity. So here’s to a lasting opportunity!
The Income Opportunity
The income opportunity is upheld not only by ASEA products and their breakthrough composition—it’s supported by a balanced network marketing business model. That’s why the compliance guidelines associated with the income opportunity are in place to serve retail customers and associates alike.
Too Personal to Promise
Just as in making product claims, the Federal Trade Commission (FTC) enforces laws on the making of income claims. With this topic in mind, they have published their own advice to independent distributors out on the recruiting trail. We have summarized it below:
Keep in mind that when you recruit new distributors, you are responsible for the claims you make about how much money they can earn. . . . If your promises fall through, you could be held liable, even if you are simply repeating claims you read . . . or heard from another distributor.1
At ASEA, we understand that the success of an individual in the direct selling industry depends on their personal circumstances and efforts. That’s why we remind associates that it is not appropriate to promise any level of compensation or income.
Not only is this a sensible practice, it intentionally keeps you from the red tape associated with making income claims, i.e., providing a “clear and conspicuous” income disclosure statement any time you discuss potential earnings with a prospect. See an example of an income disclosure, complete with a clear and conspicuous disclaimer from the ASEA website:
The Ecosystem of Opportunity
The carefully balanced relationship between business volume, bonus structure, and an ASEA product’s retail price is what allows our compensation plan to provide both retail-based and business-building incomes—but it only works as intended when products are sold at the approved retail price.
Not only does using noncompliant channels to sell products for less than the established price throw the compensation plan out of balance, it can erode the market value of the product, hurting your ability to earn income through retail sales. That’s the short story of why associates may not advertise, promote the sale of, sell, or attempt to sell ASEA products on any online auction or classified ad site, including, without limitation, Amazon, eBay, et al.
It’s with good reason that retail sales is listed as the first of eight ways to earn income with ASEA. Retail sales is the foundation of a legitimate product-based multi-level marketing business. Without that fundamental way of earning income, the others fall apart. To simultaneously provide a networking opportunity and retail opportunity takes not only a breakthrough product, but one that is properly valued in the marketplace.
The devaluation of a product (which can result from unrestricted auction sales) and the subsequent loss of retail opportunity has recently led the FTC to bring charges against companies within our industry. In the eyes of the law, the thing that distinguishes a legitimate direct selling business from a pyramid scheme is retail sales that represent the “real sale of goods to the public.”1
Remember, the best way to ensure you stay compliant is by using the materials provided by corporate, and by reading through the terms and conditions available in your virtual office. When in doubt, reach out to your regional sales head or ASEA’s Associate Education & Conduct department for assistance.
- See FTC.gov