srijeda, 28.03.2018.
MLM business plan
In addition, an MLM plan might not require existing participants to buy products above cost in order to attain a greater commission/benefit level.
Paragraph 55.1(1) (b) lets a requirement to purchase products at the seller's cost with the aim of facilitating sales. Accordingly, an idea isn't very likely to improve an issue under this paragraph if a player is required to obtain a "starter kit" (manual, directives, product samples, promotional stuff) at owner's cost (see the definition of Operator's Cost or Seller's Cost under section 5.6).
An MLM plan might not need a requirement to obtain a product that's at a high price above owner's cost. This applies whether the buy requirement is an explicit illness or a implicit "de facto" condition. In determining whether an MLM plan includes a requirement to Buy merchandise the Bureau considers variables including the following:
The Bureau will take into consideration each MLM plan on the case by case basis in determining whether participants need to obtain product to take part in the strategy. While purchase requirements will likely contravene this section, sales requirements involving the selling of a product or product into non participants of this master plan are not likely to contravene this department.
Circumstance:
An operator launches an MLM plan in which a player, being a condition of entrance, has to purchase $75 of product samples at the vendor's cost to permit the participant to demonstrate the operator's assorted products.
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Comment:
This MLM plan is unlikely to fall within the definition of a scheme of pyramid selling [paragraph 55.1(1) (b) of this Act] as the product is purchased at the seller's cost to ease earnings. If this really is the case, there is not likely an issue under the Act.
Circumstance:
Participants have the possibility to purchase a training package in a price higher than owner's cost. Once purchasing a training package, a fresh participant gains the right to market training packages into new participants. Participants get a monetary bonus each time they sell a training package to another player.
Opinion:
This MLM plan seems to advertise two programs, widgets and training. Participants who choose to market training have to buy training themselves, being a condition of participating in the training aspect of the master plan and at a price higher than owner's cost. The necessity to obtain an above-cost training program before a participant may sell training packages is very likely to raise an issue under paragraph 55.1(1) (b). In addition, the reimbursement paid for your own training package along with the associated right to receive damages for recruiting and training new participants, that may in turn pay for the exact same right, is likely to raise the issue for a recruitment bonus under paragraph 55.1 (1) (a). In the event the training package was sold at the seller's cost, or participants were not required to purchase a training package in order to supply training, there will likely not be an issue under the Act.
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