It is the Distributor’s responsibility to maintain accurate sales records (including retail receipts and Distributor Sales Reports — Form 1000). The Market America Marketing Plan is based upon retail sales to the end consumer; therefore, all forms of stockpiling or inventory loading are prohibited. Products are offered to Distributors only for sale to consumers and, at the Distributor’s election, personal consumption.
A minimum of 70 percent of products ordered by a Distributor must be sold to retail customers.
(A) Enforcement: Executive Coordinators are responsible for enforcing this policy in their organization and may be required to buy inventory that is not sold by their downline within 90 days of purchase, as it violates the 70 Percent Rule. Market America enforces this provision for the purpose of complying with various legal requirements that apply to the company’s operations. This policy is not an alternative to the regular product return policy (see Return Policies).
(B) Documentation: The company requires each Distributor to furnish documentation of retail sales upon request.
Some Market America products may be subject to sales tax in the states in which they are sold at retail. The tax is calculated on the retail sales price of non-exempt products. All Sales tax collected by Market America is remitted to the appropriate state.
(A) Exempt Status:
(1) United States/U.S. Territories: To avoid having Market America charge sales tax on orders, Distributors must apply for an appropriate Sales Tax ID and forward a copy of the Sales Tax License, Resale Certificate, and Market America Sales Tax Agreement form to the company. Sales tax is based on three factors: the shipping address, whether the paying Distributor has appropriate documentation on file with Market America, and the taxability of the product/service itself. Note: In some states, Distributors are required to remit sales tax to Market America. (e.g. California does not permit Distributors to obtain sales tax documentation and they are required to remit sales tax to Market America, unless they are Health Professionals, in which case they can send in a photo of their place of business with a copy of their resale certificate in order to avoid having Market America charge them sales tax.).
(a) To avoid having Market America charge sales tax on an order, the paying Distributor must have appropriate sales tax documentation on file with Market America for the state/territory to which the product is being shipped.
(b) If the paying Distributor does not have appropriate sales tax documentation on file with Market America for the state/territory to which the product is being shipped, then taxability will depend on what is considered taxable in that particular state/territory.
(c) In some states/territories, shipping and/or the administration fee is considered taxable.
(d) The ID number and name on the sales tax documentation must coincide with the ID number and name of the distributorship. If Distributors change their ID number and/or name, they need to update their sales tax documentation as well.
(2) Canada: Distributors residing in Canada are completely responsible for collecting, remitting and reporting their own sales tax and GST, where applicable; therefore, they should not submit any sales tax documentation to Market America.
(B) Administration Fee:
(1) United States/U.S. Territories: For Distributors who do not have appropriate sales tax documentation for the state/territory to which an order is being shipped, an administration fee will be charged. The administration fee is based on the suggested retail price (or Distributor cost for items/services that have no suggested retail price) of the total order, regardless of the taxability of individual items on the order. Note: If the paying Distributor does not have appropriate sales tax documentation on file and sales tax is charged on any item on the order, including if sales tax is charged only on the administration fee itself, then the administration fee is based on the suggested retail price of the total order.
(2) Canada: Canadian Distributors are completely responsible for collecting, remitting, and reporting their own sales tax and GST, where applicable, and are automatically charged an administration fee on all orders being shipped to Canada.
(C) Compliance: Each Distributor shall comply with all state, provincial and local taxes and regulations governing the sale of Market America products.
Distributors may not sell Market America products in retail establishments, but they may sell Market America products in service establishments.
(1) Service Establishment: A service establishment is defined by Market America as a business that earns 50 percent or more of its gross income from a related service. Examples of these service establishments include but are not limited to: beauty salons, tanning salons, chiropractic and physician’s offices, automotive service centers, gymnasiums, dance and aerobic studios, and car washes.
(2) Retail Establishment: A retail establishment is any business that earns 50 percent or more of its gross income from products purchased from “the shelf” or directly accessible to the end consumer, such as behind the counter for purchase. Examples of these retail establishments include but are not limited to: health food, automotive parts, grocery, hardware stores, drug stores, and pharmacies. Retail establishments range from privately-owned “Mom and Pop” stores to franchised convenience stores and chain store retail establishments.
(B) Merchandising: Products and services may be merchandised on counter or shelf displays in any area of the service establishment. NO products may be sold or stored in a retail store of any kind.
(C) Representation: Product information (as outlined by Market America literature only) must be available to the end consumer at all times.
(D) Distributor Identification: It is the responsibility of the Market America Distributors supplying the service establishment with Market America products to provide a visible marking or label containing their name, address, and phone number on the product for customer questions and to provide product information.
(E) Selling to Retail Establishments: Market America Distributors cannot sell Market America products to any retail establishments for resale. Market America Distributors cannot sell to a jobber, independent representative, or third party to sell to any retail establishment. Company-approved literature only may be placed in retail establishments.
Distributors are free to sell products at any price they choose subject to the provisions of Chapter 20, Section 7. The Suggested Retail Price is only a guideline provided by the company for comparable products in the retail market place.
There shall be no exclusive territories for marketing, sales or distribution purposes, nor shall any Independent Distributor imply or state that s/he has an exclusive territory. Market America encourages Distributors to build and manage their sales and distribution organization locally and respond to responsible growth in any geographic location.
Certain United States products may be made available for purchase by Canadian Distributors for personal consumption via the Canadian Personal Consumption Program. To take advantage of this program, Canadian Distributors and Preferred Customers must sign and submit to Market America a Personal Consumption Agreement. Once the signed Personal Consumption Agreement is on file with Market America, Distributors must use the Canadian Personal Consumption Product Order Form to order these products.
(A) Agreement: By signing the Personal Consumption Agreement, Canadian Distributors and Preferred Customers agree that:
(1) these products shall not be offered for resale or distribution;
(2) these products are for personal consumption or the personal consumption of immediate family (“immediate family” is defined as father, mother, children or spouse, including a common-law spouse, with whom the Distributor or Preferred Customer permanently resides);
(3) purchases under this program are limited to a three-month supply per quarter;
(4) promotion of this program or its products in any form of media is strictly prohibited.
(B) Other Limitations:
(1) Products ordered via this program will be shipped only to the residential address indicated on the Personal Consumption Agreement.
(2) Business volume generated from Distributors ordering these products will be assigned automatically to the Distributor’s
(3) Purchases made via this program cannot be used to satisfy a Distributor’s minimum activity requirement of submitting a Distributor Sales Report (Form 1000) showing at least $200.00 in retail sales each quarter.
(A) Storage: Products marketed through Market America shall be stored in accordance with instructions (as applicable) provided on the product information labels.
(B) Packaging: It is not permissible for Market America products to be repackaged in any manner whatsoever. This is expressly forbidden by the labeling laws of state and federal agencies. Market America carefully complies with such laws.
(C) Product Liability Insurance: Market America carries product liability insurance as protection against claims from possible defects in its products.
Last Modified :02/12/2018 11:57:29 AM EST