You are an independent, self-motivated person and you would like to work at home. How do you find good work for yourself? Aside from designing your own business, how do you evaluate the different opportunities that seem to abound in the marketplace? How can you tell that the ones you like won’t turn out to be scams?

What Do Business Opportunities Look Like?

They are characterized by a large initial payment, often required before you get anything, to a company you know little about, which promises to help you develop your business and/or which has the inventory you need.

What Can Go Wrong?

• You do not earn the money that the company claims you can make – easily.
• The work is harder than you expected – the work was not really made clear to you.
• There is no actual market for the product.
• You get no support from the company – they were friendly only before they had your money. Or the subsequent support will cost you extra.
• The company does not take your extra product back.
• The Company does not back the product with warranties and guarantees, so that if your customer wants his money back, you are stuck.

What Are The Warning Signs?

• Pressure to sign a contract right then, today, and pay the company a large sum of money, before you can investigate the company or its claim, or get legal advice.
• Company promises you that you can make a lot of money quickly and without much effort.
• Guaranteed results.
• Upfront payment or fee for a kit, or products, or training that greatly exceeds the fair market value of the products or services.
• A fee which is payable before you receive anything in return.
• Unwillingness by the company to give you disclosure documents required by law (often required if the initial commitment is a payment of $500).

How Do You Investigate An Opportunity?

Ask, ask, ask!

About the company: Ask where the company is incorporated, whether it has an office in your state, who its officers are, what their backgrounds are, and what kind of business experiences they have had. Get written copies of the company’s business and financial statements. The Federal Trade Commission and some state laws require sellers of certain business opportunities to provide information about their operations to all potential purchases.

Verify the company information. Call the Secretary of State (Corporations Division) in your state or in the state the company is set up in – ask if it is registered. If you can get a Dun & Bradstreet Report on the company, do, or check with other business reporting services especially to see what kinds of legal claims have been made against the company. Check with the attorney general’s office (Consumer Affairs Offices) of the state the business is registered in, or your state or county, to learn of complaints. Call the regional FTC (Federal Trade Commission) office in your area.

About the Products: Ask what the cost is to you, and what the selling price is of such products in your area. Where do you get your supply? Can you return your supply and get at least 90% of your money back? What performance claims can you make about the product or service? Are there guarantees and replacement or repair policies? Does the company have a method for handling complaints from either you or your customers?

Consult with people in your area. Ask whether they would buy such a product or service and what they would pay for it. Review, with persons who know your area (such as a county or city Office of Economic Development), the marketability of the product or service, the pricing, the projected earnings.

About the Fees: What is the initial fee to pay for? Will it be escrowed? If so, by whom? Until when? If the fee covers a sample kit, or initial supply of product, does it greatly exceed the cost of the kit or product?

Ask about Support: What kind of support are you supposed to get? Are there training programs? In your area? Will there be someone you can get personal attention from? Does it cost extra? If there are others currently selling in your area, can you meet them before you commit, to check out how they are doing?

Get All Promises In Writing

MAKE SURE THE CONTRACT IS SIGNED BY AN AUTHORIZED AGENT OF THE COMPANY

There are many business opportunity frauds out there. If it is worth your time and money to do this job, it is worth your time and money to investigate and not be pushed into a decision. You should never have to sign up the first day.

If you have reason to believe that a fraud is operating in your area, whether or not you have invested, notify your local district attorney (first), and also your consumer affairs office, your local Better Business Bureau and Chamber of Commerce.