This issue, like all issues concerning the evaluation of an MLM’s compensation structure, is fact-specific and usually involves a comprehensive analysis of a variety of factors. It is worthwhile, however, to highlight two topics that the FTC is likely to consider when evaluating an MLM’s payment of compensation that is premised, in part, on participants buying product that is not resold. First, the FTC staff is likely to consider whether features of the MLM’s compensation structure incentivize or encourage participants to purchase product for reasons other than satisfying their own personal demand or actual consumer demand in the marketplace. Second, the FTC staff is likely to consider information bearing on whether particular wholesale purchases by business opportunity participants were made to satisfy personal demand. The persuasiveness of this information in any particular case will depend on its reliability.
This eco-friendly MLM is seriously committed: their headquarters are operated with wind power. They’re pretty future-facing in general, having implemented an innovative social marketing strategy amongst their reps. No one likes to be harassed on Facebook, but Modere’s social media plan is still 10 times more effective than holding home parties (kill me).
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