Neumi has instructed distributors that promoting its merchandise “on Amazon, eBay and Walmart violates FTC compliance”.
The extraordinary declare was made in a company-wide electronic mail Neumi despatched out on September twenty seventh.
From Neumi’s electronic mail;
Promoting Neumi merchandise on third-party platforms like Amazon, eBay, and Walmart is in opposition to firm coverage and violates FTC laws.
Neumi’s reasoning?
The Federal Commerce Fee (FTC) mandates that well being and wellness product claims have to be correct, substantiated, and never deceptive.
If you happen to’re questioning what that second paragraph has to do with Neumi distributors promoting merchandise on third-party platforms, you’re not alone.
What’s really occurring right here is Neumi is misrepresenting its personal prohibitions as FTC compliance violations. Secondary is whereas Neumi company sells on Amazon, in addition they completely don’t need any competitors from distributors.
That is spelled out in the remainder of Neumi’s electronic mail;
When offered by way of unauthorized platforms, Neumi can not assure product high quality, authenticity, or correct illustration, which may result in false promoting or client hurt.
With a view to forestall this, Neumi Company arrange an Amazon retailer as a technique to maintain unauthorized sellers from with the ability to undercut costs and to regulate those that will not be approved to make use of our logos and copyrighted supplies.
Sadly, eBay and Walmart don’t but have insurance policies on copyrights and logos that firms can use to take away unauthorized sellers on their websites.
Because of this, promoting Neumi merchandise by way of third-party websites isn’t in compliance with FTC tips and is strictly prohibited.
Holy misinformation batman!
First off I need to reiterate that it’s completely not an “FTC violation” to promote Neumi’s merchandise on Amazon or anyplace else.
That is totally an inner Neumi prohibition that doesn’t lengthen outdoors the enterprise. If we briefly entertain Neumi’s nonsense and settle for that promoting Neumi’s merchandise on Amazon “violates FTC laws” – how is Neumi company doing so?
And when was the final time the FTC went after MLM firms or their distributors/associates for the only act of promoting merchandise on an ecommerce platform? I’ve been operating BehindMLM since 2009 and have by no means seen a “they offered on Amazon” enforcement motion.
Along with not wanting competitors on third-party websites from distributors (earnings for me, not for thee), key to understanding Neumi’s restrictions is “Neumi can not assure product high quality, authenticity, or correct illustration”.
The notion that Neumi is chargeable for asserted counterfeit merchandise is absurd. Had been US authorities to behave, the sellers of counterfeit Neumi merchandise can be accountable. Additional up the chain you’d then have the producers.
This although has nothing to do with distributors or anybody else promoting Neumi merchandise on third-party web sites.
As per Amazon’s “branded product” guidelines;
To checklist a registered branded product on Amazon and keep away from IP complaints for trademark violations, you will have a Letter of Authorization from the model or producer that states that you could be promote their merchandise on Amazon.
If you’re unable to supply a Letter of Authorization from the model or producer, you might present a legitimate Producer or Verified Provider bill to show that you’re shopping for straight from the producer or approved distributor.
This is applicable to each single branded product you propose to promote on Amazon that’s enrolled in Amazon Model Registry.
As per Amazon’s personal guidelines, if I bought merchandise from the corporate or a distributor, offered Amazon with a receipt from Neumi, I’d be good to promote Neumi merchandise on Amazon.
If I used to be a Neumi distributor the corporate may ship me authorized threats after which terminate me, however that’s once more an inner Neumi difficulty. It has nothing to do with Amazon’s insurance policies and it’s definitely not an FTC Act violation.
There doesn’t seem like any restrictions on promoting dietary supplements on eBay, offered they’re unopened and never expired.
Walmart Market requires dietary supplements on the market to be
both have been marketed as a dietary ingredient within the U.S. earlier than October 15, 1994, be typically acknowledged as secure by FDA, been submitted to FDA as a “new dietary ingredient,” or be marketed pursuant to an authorised meals additive petition.
I’m not 100% certain if “be typically acknowledged as secure” applies to Neumi dietary supplements. Neumi may need to make a request to the FDA to fulfill Walmart Market. If that’s the case, they haven’t completed so (so far as I’m conscious).
Be it Amazon, eBay, Walmart Market or another ecommerce web site, the sample right here is web site particular necessities have to be adhered to. There’s nothing within the FTC Act that prohibits the sale of Neumi merchandise by distributors on any platform.
What we’ve got right here is an MLM firm looking for to keep up a monopoly on on-line product gross sales, by way of the spreading of misinformation concerning FTC regulation.
Unsure if such conduct in and of itself is an FTC violation however I wouldn’t be stunned whether it is.
With respect to its distributors, the ethical and moral factor for Neumi to do can be to difficulty one other communication clarifying promoting their merchandise on-line isn’t an FTC regulatory violation.
Be upfront along with your distributors about wanting to keep up Neumi company’s ecommerce gross sales monopoly. Positive it’s scummy however at the very least it’s sincere.
BehindMLM reviewed Neumi again in 2022. We discovered Neumi’s official compensation documentation really helpful distributors buy merchandise to qualify for commissions. The corporate even offered a “quarterly pack for qualification”.
That is the “autoship recruitment mannequin”, which if utilized by an MLM firm lends itself to operation of a pyramid scheme.
As an alternative of creating up FTC Act violations to keep up a web based gross sales monopoly, how about addressing the vast majority of Neumi gross sales probably being tied to distributors as an alternative of retail prospects?
Y’know, an precise FTC Act violation.