Time: Agenda #1 09:00~12:00

Place: B1 Multipurpose Hall, 2^nd Student Activity Center, National Taiwan University

Chair: Chen Der-Fa, Director of Direct Selling Research Center

Attendees:

1.  Government Officers: Department of Health、Fair Trade Commission、SMEA, Ministry of Economic Affairs

2.  Chief Officers of Direct Selling Companies (attachments)          

Speech: Liu Wei-Chi, President, National Sun Yat-Sen University:

   1.   Confronted by the great impact of new economy and the competitive pressure of Internet, direct selling

        business should reconsider their strategies to survive and expand.

   2.    Direct selling business must re-establish their positions; instead of selling products and services only, they must have passion and hope too. Keeping up the passion and hope in an organization is a significant issue that needs our attention.

   3.   In the future, companies should focus their development on public welfare and complement by profit to grow forever.

Chair: Chen Der-Fa, Director of Direct Selling Research Center

The main objective of this direct selling summit is to execute the decision made in “Direct Selling Summit” last June. (Please see the “ Direct Selling Minute” and “Main Points in Direct Selling Minute in detail). The meeting will be proceed in discussion.

Main Topics:

(一)   The Significance and Effects of New Social Trend to the Development of Direct Selling  Business.

(二)   Establishing a Better Management Environment.

(三)   How to Strength the Quality and Competitiveness of Direct Selling Business.

Lee Chiu-Tsu, Director of Network Marketing Magazine;

Chou Yu-Hsien, CEO of Nu Skin;

 Liu Ming-Hsiung, President of Amway Corp. 

all take roles to introduce each topic. Hopefully the meeting will collect meaningful ideas and generate concrete results and methods.

(四)   Topic <1>: The Significance and Effects of New Social Trend to the Development of Direct  

                       Selling Business.

      Introduce by Lee Chiu-Tsu, Director of Network Marketing Magazine

Outline:

The rise of Internet has caused marketing channels, human resource and capital to change.

Outcome:

              (1)     Integration of upper、middle and lower resource.

              (2)    Competitions from different channels.

              (3)    Consolidation of solidity and virtually.

              (4)   All channels towards direct selling.

   二、The Association of Human-net and Internet in Direct Selling .

             (1)  Speed up the production flow, product lifecycle and customers’ loyalty.

             (2)    Rationalization of channels’ cost.

             (3)   Caring of direct selling companies and direct selling distributors to provide better customer   

                    services.

             (4)    Proper Integration of Marketing Sensibility (Human Net) and Sense (Technology Net).

   三、Coalition of Dynamic Organization and Virtual Community in Direct Selling.

Within its highly mobile and dynamic characteristics, customers in direct selling business are less loyal to the product. Direct selling distributors should therefore effectively apply internet to build a virtual organization and transmit relevant message to other members and customers within the organization to operate the organizational network efficiently.  

四、The Rebuild of Customers Relationship.

      (1)  In the past, direct selling business is based on manufacturing but in the new century, direct  

           selling business will refocus on customer orientation to effectively handle huge customers’ group.

      (2)  Harness relationship marketing: A. To consolidate customer relationship. B. To get hold of

           more customers. C. To broaden our channels. 

 Discussion: (Minute)

Cheng Sheng-Hsien, President of Sunrider Corp.:

If direct selling companies can not harness the integration of human-net and technology-net completely, will human-net be replaced by technology-net? If so, when?  

Lee Chiu-Tsu, Director of Network Marketing Magazine:

              (1)     Technology-net could never replace human-net.

              (2)     In the  future, direct selling business will require competent and ambitious managers to 

                    join  the operation of important channels.

  Liu Ming-Hsiung, President of Amway Corp.:

              (1)    New internet technology is neutral itself and every business can use it. To a direct selling     

                    business, new internet technology is a complement, not a replacement.

              (2)   Direct selling companies should exercise database effectively to assist direct selling 

                    distributors to expand their operations.

Cheng Sun-Chen, President of Bi-narie Corporation:

              (1)  While the internet technology growing to become spume, direct selling business should catch 

                   the opportunity to organize its end-customers.

              (2)  Direct selling businesses require a common web-entrance to wall off individual web-site that 

                    harming direct selling business’ reputation.        

Chen Sui-Kon, Director of Department of Health:

         (1)   After the establishment and execution of “Health Food Regulatory Guidelines”, less than 40 

               cases  were submitted for review and only 12 cases were being approved; all relevant 

               information is posted on Department of Health Web-site. Generally people are more concerned 

               with the punishment and execution of this regulation.

         (2)    Department of Health will organize a public hearing on “Health Food Regulatory Guidelines” 

               to collect everyone’s opinion and use it for any necessary amendment.

Topic <2>: Establishing a Better Management Environment.

Introduced by Chou Yu-Hsien, CEO of Nu Skin Corp.

Outline:

       一       、How to communicate and interact better with government.

       二       、How to win government’s respect and support on direct selling business.

Tactics:

          (1)   Establishing a strong and prevalent group to represent direct selling business to negotiate 

                and communicate with government.

          (2)  The involvement of academy is a good way to enhance direct selling business’ image.

          (3)  Better interaction with media is a tool to enhance our reputation and to receive support.

          (4) Direct selling business should self-respected and operate legally.

Discussion:

Fair Trade Commission:

The major task of Fair Trade Commission is to provide information, understand management movement, and promote direct selling business. With the establishment of the regulation, direct selling business will have a legal and fair operational environment.

Ministry of Economic Affairs:

          (1)   Ministry of Economic Affairs always provides much freedom to the business.

          (2)   “Internet Signature Law” has submitted to the legislators for review and aimed to provide 

                 security for the internet conduct after its effectiveness.

          (3)   Although I personally believe e-Commerce is a new channel but it will not replace human-net 

                completely.  

Chang Shi-Hui, President of VivaLife Corp.:

Fair Trade Commission should take immediate action on any illegal conducts made by unlawful companies to maintain the reputation of direct selling business.

Lin Chun-Hui, Special Assistant of VivaLife Corp.:

          (1)   Since legislators and executors not quite familiar of direct selling business, direct selling 

                business must communicate with them more frequently.

          (2)   The key point of management is to forgive not to obviate. Direct selling business should 

                develop from a self-regulated group to a self-governed group. Direct Selling Association 

                should play a decent and unbiased role to assist government to review harmful direct selling 

                companies and to handle any dispute to reduce Fair Trade Commission’s burden and to handle 

                illegal affairs.

Chair: Direct selling business’ development from a self-regulated group to a self-governed group is a good issue but due to the limitation of time, we will leave it at the end for more discussion.

Topic (3): How to Strength the Quality and Competitiveness of Direct Selling Business.

Introduced by Liu Ming-Hsiung, President of Amway Corp.

      一       The upgrade of image and management quality of direct selling business.

      二       The progress and impact of direct selling e-business.

Outline:

The competition direct selling business faced is like playing golf, competing with oneself and court. Companies should cooperate with each other to generate good sales. Only by the improvement of management quality and creation of brand value, individual firm could enhance its competitiveness.

Tactics:

Internally:

          (1)   Fast response. The traditional way, such as launching a new product after its market survey is not      

                appropriate for the existing market.

          (2)  Control of human capital: The most talented individuals are easier to leave while the company 

                is undergoing reengineering process.

          (3)   Speeding up the use of electronic channels.

          (4)     Innovative value and service. .

Externally:

          (1)           Customer satisfaction—Image and Reputation

          (2)           The consonance of concepts and value.