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The Direct Selling Association (DSA) is a
trade association A trade association, also known as an industry trade group, business association, sector association or industry body, is an organization founded and funded by businesses that operate in a specific industry. An industry trade association partic ...
in the United States that represents
direct selling Direct selling consists of single-level marketing (in which a direct seller makes money by buying products from a parent organization and selling them directly to customers) and multi-level marketing (in which the direct seller may earn money ...
companies, primarily those that use
multi-level marketing Multi-level marketing (MLM), also called network marketing or pyramid selling, is a controversial marketing strategy for the sale of products or services in which the revenue of the MLM company is derived from a non-salaried workforce selling th ...
compensation plans. On behalf of its members' companies, the DSA engages in
public relations Public relations (PR) is the practice of managing and disseminating information from an individual or an organization (such as a business, government agency, or a nonprofit organization) to the public in order to influence their perception. ...
and
lobbying In politics, lobbying, persuasion or interest representation is the act of lawfully attempting to influence the actions, policies, or decisions of government officials, most often legislators or members of regulatory agencies. Lobbying, which ...
efforts against regulation of the multi-level marketing industry, and it funds political candidates through a political action committee.


History in the US

The American DSA, headquartered in Washington, D.C., is the national
trade association A trade association, also known as an industry trade group, business association, sector association or industry body, is an organization founded and funded by businesses that operate in a specific industry. An industry trade association partic ...
of a group of firms that manufacture and distribute goods and services sold directly to consumers typically through social selling that includes a compensation model called multi level marketing. Founded in Binghamton, New York in 1910 as a trade group for
door-to-door Door-to-door is a canvassing technique that is generally used for sales, marketing, advertising, evangelism or campaigning, in which the person or persons walk from the door of one house to the door of another, trying to sell or advertise a pro ...
salesmen, the association was originally called the Agents Credit Association. It was renamed the National Association of Agency Companies (NAAC) in 1914, and briefly renamed the National Association of Agency and Mail Order Companies in 1917, before returning to the NAAC in 1920. It became the Direct Selling Association in 1968. As of 1970, less than 5% of the DSA's members were multi-level marketing companies. By 2018, the DSA's membership had grown to include nearly 130 companies, more than 90% of which were multi-level marketing companies. The DSA belongs to the
National Retail Federation The National Retail Federation (NRF) is the world's largest retail trade association. Its members include department stores, specialty, discount, catalog, Internet, and independent retailers, chain restaurants, grocery stores, and multi-level ma ...
and its member companies pledge to abide by the DSA
code of ethics Ethical codes are adopted by organizations to assist members in understanding the difference between right and wrong and in applying that understanding to their decisions. An ethical code generally implies documents at three levels: codes of bus ...
. In 2019, DSA helped launch the BBB National Programs Direct Selling Self Regulatory Council. The Direct Selling Self-Regulatory Council (DSSRC) provides impartial monitoring, enforcement, and dispute resolution regarding product claims or income representations (including lifestyle claims) disseminated by direct selling companies and their sales force members. This program provides a robust challenge process that also includes the opportunity for a company to appeal a decision.


In other countries

As of 2011, the DSA has sister organizations in the UK (with over 40 member companies), Australia (nearly 70 member companies), and Israel (7 member companies),


Political lobbying

The DSA serves as a
public relations Public relations (PR) is the practice of managing and disseminating information from an individual or an organization (such as a business, government agency, or a nonprofit organization) to the public in order to influence their perception. ...
and lobbying group acting on behalf of its member companies. The DSA played a role in petitioning the
Federal Trade Commission (FTC) The Federal Trade Commission (FTC) is an independent agency of the United States government whose principal mission is the enforcement of civil (non-criminal) antitrust law and the promotion of consumer protection. The FTC shares jurisdiction ove ...
to exempt multi-level marketing companies from consumer protection regulations outlined in the FTC's 2006 proposed Business Opportunity Rule, encouraging people to write 17,000 form letters complaining about the rule from 2006 to 2008. The law was passed in 2012, with most multi-level marketing companies considered exempt. The DSA supported and allegedly drafted much of the language of the "Anti-Pyramid Promotional Scheme Act" introduced by US Representative
Marsha Blackburn Mary Marsha Blackburn (née Wedgeworth; born June 6, 1952) is an American politician and businesswoman serving as the senior United States senator from Tennessee, a seat she has held since 2019. She is a member of the Republican Party. Blackbur ...
, and an amendment to the US House of Representatives' omnibus Financial Services and General Government Appropriations bill for fiscal year 2018 by US Representative John Moolenaar that would have limited the ability of the FTC and other agencies to classify companies as pyramid schemes and to investigate whether MLMs are pyramid schemes. The amendment would have disbarred the Treasury Department, the Judiciary Department, the Small Business Administration, the Securities and Exchange Commission, the FTC, or any other agencies from using any monies to take enforcement actions against pyramid operations for the fiscal year. The Act would blur the lines between legitimate MLM activity and pyramid schemes established under the original 1979 FTC case by deeming sales made to people inside the company as sales to an “ultimate user,” thus erasing the key distinction made in the ruling between sales to actual consumers of a product and sales made to members of the MLM network that are used for recruitment of additional members or to qualify for commissions. The amendment was opposed by a coalition of consumer interest groups including
Consumer Action Consumer Action is a nonprofit, consumer education and advocacy center, serving consumers in the United States. Founded in 1971, the mission of Consumer Action is to help individual consumers assert their rights in the marketplace and to advance ...
, the
Consumer Federation of America The Consumer Federation of America (CFA) is a non-profit organization founded in 1968 to advance consumer interests through research, education and advocacy. According to CFA's website, its members are nearly 300 consumer-oriented non-profits, w ...
,
Consumers Union A consumer is a person or a group who intends to order, or uses purchased goods, products, or services primarily for personal, social, family, household and similar needs, who is not directly related to entrepreneurial or business activities. ...
(the publisher of '' Consumer Reports'' magazine), Consumer Watchdog, the
National Consumers League The National Consumers League, founded in 1899, is an American consumer organization. The National Consumers League is a private, nonprofit advocacy group representing consumers on marketplace and workplace issues. The NCL provides government, bu ...
, and the United States Public Interest Research Group (US PIRG), as well as Truth in Advertising (TINA.org) in its original incarnation.


Pyramid schemes

The DSA has said that pyramid schemes which disguise themselves as direct selling companies have caused confusion in the industry. In 2013,
Tupperware Tupperware is an American home products line that includes preparation, storage, and serving products for the kitchen and home. In 1942, Earl Tupper developed his first bell-shaped container; the brand products were introduced to the public in 1 ...
left the DSA citing industry changes and concerns over pyramid schemes. In 2014, Avon (a founding member) left the DSA citing that its bylaws were inadequate in protecting consumers from fraud. News reports have connected Avon's quitting to pyramid scheme allegations against DSA member Herbalife, which was under investigation by the FTC at the time, and has now been ordered agreed to pay two hundred million dollars in a settlement. The DSA made a statement that they would look at Avon's concerns.{{cite news, last1=Berr, first1=Jonathan, title=Why Avon quit direct-sales group, url=http://www.cbsnews.com/news/whats-behind-avons-surprising-decision-to-quit-trade-group/, accessdate=31 July 2015, agency=CBS News


References


External links


Direct Selling Association
US
DSA Consumer Website
Direct selling Multi-level marketing companies Trade associations based in the United States