February, 2008

Business　Profile

The Japan Direct Selling Association (hereinafter called "JDSA)，founded in April of 1980 with the support from direct selling companies and the Ministry of Economy，Trade and Industry (METI)，is the only public service corporation in Japan's direct selling industry．


JDSA has been clearly positioned within the law，and its objectives are to supervise the fair trade of direct sellers in light of the "Door-to-Door Sales Law"（ renamed Specified Commercial Transactions Law in June of 2001）revised and enforced in November of 1988，to protect consumer rights at the same time as contributing to the sound growth of the direct selling industry as a whole．In addition，it is the responsibility of JDSA to fairly solve consumer complaints concerning the sales of a member of JDSA．

The direct selling industry had grown at a rapid rate from 1980's to about the middle of 1990's and has gained a firm position in Japan's distribution industry，with the result that the business of JDSA has broadened out．


Under these circumstances，JDSA is determined to thoroughly study every aspect of direct sales in Japan，so that it will be able to deal with a variety of issues for the further development of proper transactions through the direct sales method．


　Objectives

The objectives of JDSA are as follows：
−To establish business ethics concerning direct selling so that a fair transaction can be made and the rights of a person who purchases products or services through a direct seller is protected；and
−To contribute to the sound growth of the direct selling industry，in other words，to contribute to the sound growth of the national economy as a whole．


　Business

To achieve the above objectives，JDSA engages in the following operations：
(1) Investigation and research concerning direct selling
(2) To establish and enforce the ethic outline concerning direct selling
(3) To receive，advise on，investigate，and manage complaints concerning direct selling in order to resolve the problem
(4) To judge unfair direct selling transactions and to proceed forward with the judgment
(5) To educate and give instructions to salespersons who engage in direct selling
(6) To register salespersons who engage in direct selling
(7) To gather and provide materials from/to the inside and outside of the country concerning direct selling
(8) To communicate with and coordinate direct selling organizations inside and outside of the country
(9) To set into motion the establishment of a complaint procedure system concerning direct selling
(10) To enlighten consumers concerning direct selling
(11) To take whatever steps are necessary to achieve JDSA's objectives


　Specific Activities

1．To Activate the Self−Imposed Control
(1) Code of Ethics
The "Code of Ethics" determines the basic articles which should be upheld by the member organizations and their salespersons in order to protect consumer rights and to ensure the sound development of direct selling transactions．
The essential points of the Code of Ethics are：
A) To engage in a business activity based on a consumer oriented society
B) To stay within the law and to make a concerted effort to maintain good order
C) To thoroughly educate salespersons
D) To provide accurate products information and proper transaction procedures to the consumer
E) To establish a grievance procedure system and deal with complaints fairly
F) To forbid the following actions：
a) To prolong a salesperson's stay against the consumer's wishes while selling products
b) To slander or abuse others while selling products
c) To trick the buyer into purchasing while selling products
d) To hall a prospective buyer off the street with the aim to sell products ("catch sales")
e) To sell products using unfair methods such as fraudulent act
l Besides the above Code of Ethics, Voluntary Code of Conduct.


(2) Ethics Committee
This committee，which consists of five independent，fair-minded people of experience or academic standing，judges if a transaction was unfair or not and takes hard stance when members engage in an unfair direct selling transaction against the code of Ethics．


The committee discusses how serious the transaction was；how often the transaction has occurred；how wide the transaction was made；how the member dealt with the problem after the unfair transaction was detected；and how the transaction effects society，and advises on how to solve the problem．When necessary，the committee gives advice to the board to suspend the right or dismiss the member from the Association，and the board will enforce the decision as an organizational decision．
The company name that was dismissed from JDSA will be a releasable.

(3) Salesperson Registration System & Education Training and Examination for Direct Selling Instructor System

The purpose of this system is to thoroughly educate a salesperson so that the integrity of the salesperson will be improved.

The salesperson who completes the training program arranged by JDSA and passes the examination is registered into JDSA and receives the "Certification of Training and Registration for the Direct Salesperson."
The system produced about one million registered sales persons now.

JDSA started an Education Training and Examination for direct selling instructor System as a supplementary measure the existing salesperson registration system. Also JDSA has held seminars for those who would be engaged in educate persons of member companies. When they pass the examination implemented by JDSA, They will become qualified as salesperson-instructors. The examination is very difficult and they must answer perfectly all of the questions regard Specified Commercial Transactions Law correctly. The passing rate is a little less than 70 %. As of today, total 2613 persons have been approved by JDSA as qualifies instructor.



(4) Consumer Inquiry Procedure System
A) Direct Selling Emergency Call
As an organization which manages consumer inquiries concerning direct sales，a consumer service hot-line called the "Direct Selling Emergency Call" was established within JDSA．In order to smoothly respond to consumer inquiries throughout the country，telephone calls from consumers will be automatically transmitted to JDSA headquarters via offices in seven major cities(Sapporo，Sendai，Nagoya，Osaka，Hiroshima，Takamatsu and Fukuoka)．JDSA copes with all inquires from consumers quickly and fairly．


Not only two staff from JDSA but also three experts in consumer affairs are working as consultants under the Direct Selling Emergency Call system．
Number of complaints and inquires from consumers in 2003
is total 2377.


B) Procedure for Complaints
Among the complaints dealt by the "Direct Selling Emergency Call" system following the Specified Commercial Transactions Law，the complaints which directly concern the members themselves are periodically reported to JDSA members after they have been resolved，in order to prevent the occurrence of a similar problem．


2．Public Information and Consumer Education
(1) Holding Seminars
In the region chosen as the focal point of consumer education， JDSA holds educational meetings with consumer leaders in this region when necessary and discusses how to prevent the trouble in question from occurring or spreading JDSA also holds consumer seminars as well as special seminars for senior citizens．


(2) Publishing and Distributing Consumer Educational Materials
In order for the policies of JDSA and information on sales contracts to be widely known among consumers. JDSA publishes and distributes to consumers various leaflets which describe how to buy products from direct sellers showing typical examples of unfair transactions．


(3) Periodicals
With the aim to enhance the status of the membership and to inform the activities of JDSA，a magazine is published quarterly and is distributed to members，related government agencies， consumer groups, lawyers, and Mass media etc.


3．Miscellaneous
(1) Task Force Committees，Discussions，etc．
JDSA sets up a task force committee when necessary，whether it is common among the industry or it is characteristic of a particular business，so that the task force will organize meetings to study the issue and discuss what measures should be taken．


Moreover，from the viewpoint that the consumer inquiries can be an important source of information for the development of a company，JDSA regularly holds lecture classes for the personnel of its member companies who are in charge of consumer consultation four times a year in Tokyo and a few times in another areas．The participants also can exchange information at these lectures．


(2) Exchanging Information with Related Government Agencies
The staff members of JDSA attend as many meetings as possible held by government agencies and consumer groups to inform them of JDSA's measures and to explain the industry's situation．In addition，JDSA quickly responds to the issues discussed in these meetings by figuring out adequate measures to solve the problems．


(3) Investigation and Research
With the aim to have a clear understanding concerning the direct selling industry，JDSA annually collects statistical information such as its member companies' annual sales，and provides proper information to people associated with the business inside and outside of the country．

The Present Status of Direct Selling Industry in Japan


The sales of the direct selling industry in Japan had grown year after year，however under long consumption recession, direct selling in Japan has changed to the mature market since around 1997.

The following figures show the estimated annual sales from the entire direct selling industry in Japan from 2000 to 2006，assuming that the sales from the member companies accounts for 80% of the total sales (except sales of cars, news papers, perishable foods) of all direct sellers in Japan．


Estimated Annual Sales from the Direct Selling Industry
2000−2006
2000 Fiscal Year　　 　3001 billion yen
2001 Fiscal Year　 　　2940 billion yen
2002 Fiscal Year　 　　2875 billion yen
2003 Fiscal Year　 　　2821 billion yen
2004 Fiscal Year　 　　2733 billion yen
2005 Fiscal Year　 　　2648 billion yen
2006 Fiscal Year　 　　2449 billion yen


Note：
As of January 2008，the members of JDSA(258 companies etc,)sell the following products and services;

Books and educational tools, bedding products, water-purifier equipments, cleaner, lingerie and underwear, cosmetics, health foods, beauty facial equipment, jewelry and precious metals,
Solar equipment to warm water, communication and office equipment, air cleaner, health care equipment, Japanese clothes(kimono), personal computer, sewing and knitting machines, exterior goods, stamps equipment, clothes,
Services( teaching various knowledge, esthetic, pest control,
housing reform, house cleaning, etc.)