The Study of Regulations and Practices Regarding the Multilevel Marketing of Intangible Goods
Date Issued
2005
Date
2005
Author(s)
Wu, Tsui-Feng
DOI
zh-TW
Abstract
THESIS ABSTRACT
SENIOR PUBLIC ADMINISTRATION
COLLEGE OF MANAGEMENT
NATIONAL TAIWAN UNIVERSITY
NAME：Tsui-Feng Wu MONTH/YEAR：JANUARY,2005
ADVISER：Wenyi Chu
TITLE：The Study of Regulations and Practices Regarding the Multilevel Marketing of Intangible Goods
Multilevel marketing (MLM) is a rapidly developing marketing system which is primarily built upon interpersonal networks. Both participants and the amount of sales of the multilevel marketing business have been increasing year after year since it was introduced in 1970s. The MLM business created an amount of sales for NT$51.991 billion in 2003. This development means that there are more and more products sold through multilevel marketing channels.
In recent years, many new products have been multilevel marketed. Even intangible goods (usually are services) are also popularly sold through multilevel marketing plans. Intangible goods are quite different from tangible goods, which are not only invisible and untouchable, but also are sold with a special trading pattern in the MLM business. The MLM firms usually require participants to pay a certain amount of money when they join the firms to purchase the service which will be provided in the future. This trading pattern causes many problems in operation and management practices.
This article primarily explores whether present regulations and administrative measures are sufficient to solve the above-mentioned problems. First, this article will compare the differences and similarities between tangible and intangible goods and categorize the intangible goods (services) provided by the MLM business as well by collecting and compiling business information and operation status of the MLM enterprises. Secondly, this article will help to find the successful operational strategies and competitive superiority of the MLM enterprises by examining their operation performance. Finally, this article will help to clear the current issues and draw the following conclusions by practical studies.
1.To amend the current provisions of MLM regulations
(1)To add a provision regarding the original purchase price of intangible goods;
(2)To add a provision regarding rescinding a trilateral contract;
(3)Judicial authorities should take charge of investigating and prosecuting pyramid schemes
2.To establish a regulation mechanism in the administrative authority
(1)To supervise the MLM enterprises to pay subject to contracts;
(2)To undertake an inspection project on MLM intangible goods;
(3)To establish a pre-warning system
(4)to set up a deposit and withdrawal mechanism of remuneration
Subjects
多層次傳銷
無形商品
公平交易法
多層次傳銷管理辦法
Supervisory Regulations Governing Multi-Level Sales
The Fair Trade Law
intangible goods
multilevel marketing
The Fair Trade Commission
Type
other
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