DSA Perspective: With Independent Contractor Rights in Mind, Direct Sellers Seek to Manage Distributors Who Operate Multiple Businesses

Distributors Rights

With the rise in demand for nontraditional employment and the ease with which today’s direct selling consultants can grow their businesses through social media, companies are increasingly likely to face a question that poses both legal and operational challenges: should distributors be allowed to operate businesses with multiple direct selling companies at once?

For years, many companies have been challenged to manage distributors who maintain downlines with multiple direct selling companies simultaneously. Regardless of whether or not those distributors operate businesses that offer similar, competing product lines, companies could face challenges such as brand dilution, confusion of product offerings or questions of distributor loyalty.

Distributors Rights

“We currently allow our consultants the opportunity to sign on with other direct sales companies until they reach ‘Director’ status or above, at which time we strongly discourage it.” said Karen Eschebach, Co-Founder of Clever Container. “Our train of thought is that they cannot do either company—or themselves—justice if they are trying to run multiple businesses at a management level. Prior to directorship, however, we believe our organizing products fit nicely with any other company which sells mixes, supplements, candles, housewares and so forth since we have products that can organize everyone—and even their businesses! For example, at a vendor fair, if someone is interested in food mixes, our consultant can show them a pantry product to organize the food mixes.”

One of the major challenges companies face when allowing distributors to operate multiple direct selling businesses stems from the temptation to co-brand. Whether distributors look to market different product lines via the same Twitter account or Facebook page, or they simply reference multiple companies in their email signature or promotional materials, such actions can result in brand confusion and dilute each of the respective companies’ messages.

“We prefer that our distributors market each company separately in email distribution, marketing materials and social media,” Karen said. “We have not noticed any abuse of our guidelines in the field and we believe our consultants are actually relieved that we have [guidelines] in place upfront.”

While Clever Container has enjoyed great success in offering clear-cut guidelines for distributors looking to operate multiple direct selling businesses, other companies have faced a fair share of challenges in ensuring distributors do not neglect one business for another or, worse yet, that they do not proselytize.

Still, many companies have found that allowing distributors the freedom to explore businesses with other direct selling companies positions them for greater opportunities to express creativity, learn the ins and outs of the industry and garner new ideas on how to grow and maintain each of their businesses.

Paperly’s consultants are independent business operators, but just as important, they are thriving entrepreneurs,” said Paperly CEO Jay Rudman. “Entrepreneurs, be it Paperly consultants or a more general population, constantly search for creative, legal and ethical ways to grow their businesses. Should Paperly tamp that creativity, existing and potential consultants might find other, more liberating business opportunities.”

In addition to the fact that restrictions on where a distributor can and cannot pursue new business opportunities could pose challenges for companies looking to attract new recruits, such restrictions could also pose legal concerns by blurring the lines between “independent contractor” and “employee.”

As noted in the “IRS 20-Factor Test: Independent Contractor or Employee, “if a worker performs services for a number of unrelated persons at the same time, they are usually independent contractors.” However, the amount of control a company has over its salesforce may impact whether members of the salesforce are classified as independent contractors.

“Direct selling companies need to be careful not to instruct the salesforce about when, where, and how to do their work,” said Valerie Hayes, DSA Senior Director of Global Regulatory Affairs. “The more detailed instructions or limitations a company places on its salesforce, the more likely members of the salesforce are to be deemed employees rather than independent contractors.

“It is important for companies to have written policies and procedures documenting each of the factors in the IRS’s test. When determining whether a person is an independent contractor or an employee, a regulatory body or a court is going to look at the relationship between the parties, the degree of control the company has over the individual’s work and the documentation the company provides regarding that relationship,” Valerie noted.

To that end, companies such as Clever Container and Paperly provide distributors with education and training on how to effectively operate multiple direct selling businesses without threatening the integrity or branding of any company.

“While the number of direct sellers continues to grow, it certainly is beneficial to tap into those who already know how to be successful in the industry,” Jay said. “Therefore, a direct selling company might stymie its own growth if it limits its recruiting to individuals purely outside the industry.

“One benefit of allowing Paperly consultants to sell another direct selling company’s products is it allows for cross-selling of complementary products,” he continued. “For example, Paperly’s personalized phone case might be the perfect cross-sell when a customer is purchasing a personalized purse from another company. Another benefit is Paperly can heighten a consultant’s entrepreneurial drive by removing business barriers, such as ‘You cannot sell for another company.’ By eliminating obstacles, Paperly signals that we will do everything possible to help our consultants be successful business owners.”

MLM Perspective: Starting WIth Why! What Does That Mean?


In network marketing we hear the question “What is your why?” Yet have you ever really given much thought as to what the question really means to you as an individual, or how to even figure it out?

This is not a question we hear from the guidance counselor when we enroll for college, nor do we hear it from the HR Director when they interview us for a job. So, to hear it when we are looking to start a home business, may catch us by surprise and the answer we give may not be accurate. If we do not know our WHY, then we are bound to repeat some of the same mistakes that have caused us frustrations in the past. Such as not fulfilling our goals, quitting at the first sign of rejection or worse yet, disappearing completely because we do not want folks to think we have failed once again.


So, how can we find the real answer to the question “What is your WHY?” I say we start with realizing what the basic question is asking.

Bestselling author Rick Warren, calls it “Purpose”, the Hebrew language calls it “Chazown”, and religious organizations call it your “mission or calling” in life. No matter what it is called, at the very basic of all human needs is to accomplish something bigger than themselves.

Simon Senik in his bestselling book “Start With Why” gives us some very simple strategies to define our WHY!

1. Clarity – You have to know 100% why you are making a move to a new company or to launch a home base business in the first place. And, don’t tell me “to get rich quick!”

Saying “I want to be rich, or to make more money”, is not the real why! Take some time to ask yourself deeper questions. What does RICH mean to you? Define it. Or, how much more MONEY do you want to make, and what are you going

to do with it? I have found that money is always the vehicle to something far more important. So get the clarity you need to define your WHY!

2. How – People who jump from company to company, system to system or income stream to income stream do so because they don’t have the clarity of their why. But once you have the clarity, then you have to know HOW you are going to reach your WHY and that takes figuring out something deeper; your values and principles. Something you may not have given much thought until now.

How is the vehicle you chose to reach your WHY. However, in most cases, because we do not fully understand our WHY, we use the wrong vehicle to try and reach our destination. Whatever company, organization, team or system you are using to reach your WHY, must be in alignment with your personal values and principles. When we are trying to reach our WHY, while going against our internal compass, then we shut down. When you realize you are in the wrong environment, then don’t stop
going for your WHY, just change the environment to one that will support values and principles. In most cases none of us realize we are in the wrong environment until we have clarity of our WHY!

3. What – Once you have clarity of your WHY, and know HOW you are going to reach it, then you have to look at WHAT others see. Your WHY is the belief you have for accomplishing something bigger than yourself. Your HOW is the actions you are taking daily to reach your WHY. But if people do not see that WHAT you are saying and doing is in alignment, and consistent, then you will not reach your WHY, because people will not be attracted to your team or products.

So, take time today to get really clarity on what your true driving force is in succeeding in a home base business. Once you have figured out your real WHY, ask yourself this one very important question… “If money was not a concern, what would you want to do on a daily basis to fulfill your WHY?” Now go find an income opportunity that will allow you to enjoy your passions while fulfilling your WHY!

And if you can’t find the right income opportunity… Then create it!

Living An Epic Adventure,

Troy Dooly

This article first appeared in Home Business Advertiser in the May, 2013 addition.


How to Create Work and life Balance in the Digital World


Advances in technology mean we can stay connected with everyone, anywhere, at any time, which begs the question: are we ever able to just get away?

Man At Beach

Work-life balance used to be deciding whether to stay at the office late or bring work home. Nowadays, the decision is much more complex. The proliferation of mobile technology has fundamentally changed our expectations about availability, particularly when it comes to work. We are constantly connected, making us seem always available.

Most people don’t like to be left out and mobile technology ensures that we can be in on nearly every conversation. As a result, we have developed an unnatural need for constant contact that has caused us to prioritize by the moment.
This creates a frenetic environment where business owners, managers and employees are constantly checking a multitude of electronic communication platforms for fear of not being up-to-date on the latest issues, problems, or yes, even gossip at the office. What’s worse is that we prioritize our mobile communications over the actual physical communications occurring at the same time, even when it’s family and friends.

What Can YOU Do?

Balance Time for Life and Work

Set Boundaries: You don’t have to answer a phone just because it rings. Just because your inbox pings, doesn’t mean you need to open the e-mail right away. Work-life balance is about choice. Set boundaries of when you will and won’t answer work-related communication. Everyone needs boundaries, and if you don’t determine them for yourself someone else will. Block-off personal time and don’t be afraid to set hard boundaries.

Hold Conversations

Have a Conversation: Bosses need to set mobile communication boundaries with their team and establish a culture where everyone respects each other’s down time. Employees need to be proactive and say something when boundaries become blurred.

Setting boundaries can be as easy as just having a conversation. I’ve facilitated group sessions where management teams were abusing each other’s boundaries and creating a toxic work environment that was entirely their own fault. The problem was simple nobody stepped up and initiated a conversation about boundaries.

Couple Relaxing

Unplug: Last year a team of psychologists and research professors embarked on a hiking trip into the Grand Canyon for five days for the sole purpose of unplugging from the digital world. A number of them had management responsibilities and ongoing projects that overlapped with the trip, but they were not allowed to connect to check-in. The shocking result, they all survived and the world continued to move in forward motion just fine without them.

Quality over Quality

Focus on Quality not Quantity: You may think you’re being stealth when checking your BlackBerry when spending time with the family as you fade in and out of conversations. But honestly, this will likely cause more resentment than anything else. Nobody likes “half-attention” and multitasking is rarely as efficient as we think. It’s better to cut a vacation day in half, so that you can fully unplug, engage, and make it meaningful as opposed to being distracted and disengaged for a whole day

Girl Balancing

Work-life balance is no longer about the hours you spend at the office vs. the hours you spend at home. Work-life balance is about managing the grey area of constant connectivity. Whether you are a small business owner or corporate commando, it’s likely you spend a good portion of your time monitoring texts, e-mails and social media. We now live in a globally-wired world where the expectation is that if you have a mobile device, you are available. It’s up to you to take responsibility, set boundaries, and unplug.

Michael “Dr. Woody” Woodward, PhD is a CEC certified executive coach trained in organizational psychology. Dr. Woody is author of The YOU Plan: A 5-step Guide to Taking Charge of Your Career in the New Economy and is the founder of Human Capital Integrated (HCI), a firm focused on management and leadership development. Dr. Woody also sits on the advisory board of the Florida International University Center for Leadership.Follow Dr. Woody on Twitter and Facebook

by Dr. Woody
The Career Hot Seat
Published July 23, 2012

Read more: http://www.foxbusiness.com/personal-finance/2012/07/23/how-to-create-work-life-balance-in-digital-world/#ixzz21Y2OL1N7

Understanding Compensation Plans: Pros And Cons Of The Stairstep Breakway Structure By Daren Falter

Yoli Co-Founder Daren Falter

Understanding Compensation Plans

Pros And Cons Of  The Stairstep Breakway Structure By Daren Falter

Part 1: Introduction to MLM Compensation Plans

Part 2: Understanding MLM Compensation Plan Terms

Part 3: Understanding Compensation Plans: Pros And Cons Of The Matrix Compensation Structure

The Network Marketing Book

You can read more that Daren Falter has written on Stairstep Breakaway compensation plans by clicking here!

Understanding Compensation Plans: Pros And Cons Of The Matrix Compensation Structure By Daren Falter


In this video Network Marketing consultant, co-founder and compensation expert Daren Falter continued his series on compensation plans by explaining the Matrix Compensation Structure.

You can review the first two parts of this series here:

Part 1: Introduction to MLM Compensation Plans

Part 2: Understanding MLM Compensation Plan Terms

You can read more that Daren Falter has written on the Matrix comp plan be clicking here!

Understanding MLM Compensation Plans: Compensation Plan Terminology By Daren Falter


Understanding network marketing compensation plans is not the easiest things in the world. Although the math is pretty simple on the surface, it helps to know what the terminology really means. Daren Falter breaks down the terminology so all of us can understand. you can learn more about Daren Falter or buy his book at the Network Marketing Book!

Part 1: Introduction to MLM Compensation Plans

Understanding MLM Compensation Plans – Daren Falter Introduction To MLMCompensation Plans


Daren Falter is a good friend and one of the most knowledgeable person I know on compensation plans. He is a well respected consultant, company owner, and sits on several Direct Selling Boards, for both companies and distributors. I have included more about Daren below.

Daren Falter Co-Founder of Yoli - The Better Body Company

As one of the most prominent authors and consultants for the network marketing industry, Daren delivers a wealth of MLM knowledge and experience. Based on his twenty-year career in network marketing, ten as a top consultant, Daren understands the needs of both new and established MLM companies.