Let me tell you a story.
I won’t say the name of the company, but I don’t even have to, because it will happen sooner or later to every company, if they don’t take the right steps to forestall it.
The officers of this particular company announced to their sales force that the business would soon be opening in a large Asian country, but until it did, they couldn’t sign anyone up. Suddenly, all sorts of new distributors with Asian names were joining up in the States, using the same few mailing addresses. Orders were taken, and everyone turned a blind eye, because the new sales were officially logged as domestic sales.
But here’s what happened: The distributors who are very entrepreneurial and eager to get things going, said to themselves, “Well, you know what? The company wants sales, so let’s go ahead and translate the ingredients list, the legal documents, the compensation plan and sales materials ourselves.”
Guess what they did next? They began adding exaggerated claims left, right, and center.
While the company’s legal team was still in the process of getting all the paperwork done correctly for the official opening, they found themselves confronted by the country’s authorities over the claims that the distributors were making. The legal team never was able to prove the validity of the claims that had been written in the company’s name and with their trademarks. That company was subjected to penalties, and the grand opening was delayed for over a year.
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