FUNDRAISING GUIDELINES

Transcription

1 FUNDRAISING GUIDELINES Mary Kay Independent Beauty Consultants have time and again demonstrated their giving nature. Many Beauty Consultants are engaged in supporting charitable causes near and dear to their hearts and they often look for ways they can support their favorite charities while conducting their Mary Kay businesses. These Fundraising Guidelines were developed to help you understand how you can raise money for the charities you support while complying with your agreements with the Company. A. Use of Company Trade Name, Trademarks, or Copyrighted Materials The Independent Beauty Consultant Agreement, Independent Sales Director Agreement and Independent National Sales Director Agreement all provide that Beauty Consultants need written permission from the Company before using Mary Kay s trademarks, trade names or copyrighted materials in advertising or other literature. This provision is in place to protect the brand and Company image for the benefit of the millions of Independent Beauty Consultants around the world. For this same reason, it is important that you distinguish your individual charitable efforts from those of the Company. Specifically, Beauty Consultants are not authorized to use the Company s trademarks, trade names, copyrighted materials, or their status as a Mary Kay Independent Beauty Consultant when advertising or promoting their fundraising efforts for a charity, unless the charity is preapproved by the company. The charities you support should reflect your personality and the issues that are important to you and your customers. Those issues may not be as important to another Beauty Consultant and her customers and, in fact, might be considered controversial to others. The Company has from time to time received complaints from consumers and other Beauty Consultants when there was confusion caused by a Beauty Consultant s improper use of the Mary Kay name in connection with the Beauty Consultant s individual charitable initiative. Therefore, use of the Mary Kay brand will only be associated with charities chosen by the Company. You should therefore take individual credit for your own charitable efforts and not use the Mary Kay marks as a part of those efforts. We understand that The Mary Kay Foundation (the Foundation ) will license the limited use of its name and trademarks, such as Pink in the Park, to Beauty Consultants who choose to raise funds for the Foundation. In order to be approved to use the Foundation s trade name and trademarks, you must comply with the Foundation s General Guidelines for Holding a Fundraiser, located at If you are interested in learning more about the Foundation or its fundraising guidelines, you can reach the Foundation at or MKCares_Events@marykayfoundation.org. In addition, you can feel free to share with your customers preapproved posts and talking points regarding all that Mary Kay Inc. is doing through its philanthropic efforts including its charitable promotions such as Beauty that Counts. Of course, you and your customers indirectly support these charitable efforts through purchases of Mary Kay products. 1

2 B. Fundraising Should Never be Used for Team Building, Career Car Qualifications or Sales Contests The way to build a Mary Kay business remains the same as when Mary Kay Ash started this Company: (1) hold skin care parties (book), (2) sell Mary Kay products to your growing customer base (sell), and (3) share the opportunity with others (usually your Mary Kay customers) who recognize how a Mary Kay business can improve their lives (share the opportunity). A Career Car Qualifier, Director-in-Qualification ( DIQ ) or a Future National Sales Director should build their teams and future Sales Unit or National Area in a manner that is consistent with this business model, with a primary focus on promoting the sale of Mary Kay products at retail and developing a strong customer base. Fundraising for charities should never serve as the basis or method used to build a Sales Unit or a future National Area. Mary Kay appoints and rewards Independent Sales Directors because they have demonstrated their integrity and an outstanding ability to educate and motivate their unit members to become successful retail sellers of Mary Kay products. DIQ teams should be strong and sustainable after the Sales Director debuts which can only happen if the unit members have developed a strong customer base for their products in accordance with the Mary Kay business model. If a DIQ attempts to develop a Sales Unit in whole or part by having her team members use funds they solicited to purchase and then donate Mary Kay products to a charity, the DIQ has not developed a Sales Unit with a strong retail customer base. Once the unit members stop their fundraising efforts, the Sales Unit will likely not be sustainable. The Company will not appoint a potential Sales Director or National Sales Director when it determines that their potential Sales Unit or National Area was developed based on the solicitation of funds, such as setting up a Go Fund Me account, Adopt A Grandparent, Sunscreen for U.S. Soldiers or similar programs, to purchase Mary Kay products that are then donated to a charity (versus the sale of Mary Kay products to their customers), or if the Company has evidence that a DIQ or future National Sales Director has promoted soliciting charity donations as a means to build a DIQ team or National Area. Promoting the solicitation of funds for charity as a means to grow your business is inconsistent with Mary Kay s business model, and as a result, fails to truthfully present the Mary Kay opportunity as required in section A.8 of the Independent Beauty Consultant Agreement. Depending on the scope of the violation, trying or encouraging others to build a Sales Unit or future National Area in this manner could result in the termination of an independent sales force member s agreement(s) with the Company. Fundraising should never be the basis or method used to achieve a sales contest or qualify for a Seminar award. Mary Kay wants to reward those independent sales force members who are building their businesses in a manner consistent with Mary Kay s business model. As Mary Kay Ash said Nothings happens until somebody sells something! As such, contests and awards that are based on the sale of Mary Kay 2

3 products are designed to reward those independent sales force members who are working their business full circle by booking, selling products to their customers and sharing the opportunity. If the Company determines that the orders a Beauty Consultant is relying upon to achieve a sales contest or award were made using funds solicited to donate the products to a charity, the Beauty Consultant will be disqualified from the contest. C. Appropriate Ways to Fundraise Of course there are several ways you can appropriately support a charity in connection with your Mary Kay business that are compliant with your agreement(s) with the Company. A few examples are found below. Parties and Skin Care Classes If you decide that you want to raise money for a charity during a skin care or other themed party, you can share with your guests during the party how their purchases will benefit a designated charity of your choice. For example, it would be appropriate to tell your guests that During the month of February, I will be donating 10 percent of my total sales to [insert name of charity] or I will be donating $1 for every product sold at this party to [insert name of charity] and this promotion is good through the month of February. It is up to you to determine the amount of your profits that will be donated and how they will be donated, but it is important that your guests know all the details of this offer including the specifics of the donation and the relevant time period. Such charitable offers are consistent with Mary Kay s business model and your agreements because (1) the money is being raised based on your retail sale of products to your customers and (2) YOU have appropriately taken credit for you generous charitable efforts and there was no use of any Mary Kay trade names or trademarks in communicating the offer to your customers. School/ Organization Fundraisers You may be asked by your children s school or a local organization to participate in a fundraising activity. There are different ways you can participate, including donating a basket of products to a silent auction or selling certain products and donating your profits to the school or organization. When engaging in such fundraising efforts, you should consider the following guidelines: The fundraiser should be short in duration (i.e., two to four weeks) You can set up a table after a school function or at a meeting of a charitable organization and display the products you are offering in support of the fundraiser. While you can take orders at the table, you should refrain from conducting over-the-counter sales at the table. You can also provide interested individuals with a copy of The Look, highlighting the products you are offering through the fundraiser. 3

4 D. Special Considerations Tax Deductibility We strongly recommend that you avoid telling your customers that any product purchase in support of a charity is tax deductible for them unless you have conferred with a tax advisor who has approved the process you are using to assure such deductibility. Generally, if someone is purchasing products from you, which you later donate to a charity, that person cannot deduct the amount of their purchase because they did not make the payment or donation directly to a qualified organization. Qualified organizations include, but are not limited to, federal, state, and local governments and organizations qualified under the Internal Review Code Section 501(c)(3) exempt status. If you incorrectly tell a customer that a purchase is tax deductible, it can constitute a violation of the law and could result in the termination of your agreement(s) with the Company. Be Clear About the Donation If you are selling products to raise funds for a charity, we recommend that you are clear about what percent of your profits you are donating to the charity and when the donation will be made. For example, during your fundraiser, you could share that you are donating a certain percentage (i.e. 10%, 20%, etc.) of the purchase price of the product to the organization you have chosen and will be providing the amounts you raised to the charity at the end of the month. By making such a disclosure, you avoid a scenario where a customer becomes upset when they learn that you made a small profit on the sale of the goods; because you were clear and upfront about what would be donated and when. Keep Good Records In order to protect yourself, if you offer to donate a percentage of your sales to a charity (e.g., 10 percent of your net retail sales at a skin care party), it is of utmost importance that you keep a record of your sales during the event and maintain documentation that the amount raised was made to the specified charity by the date you promised. Selecting a Legitimate Charitable Organization When choosing any charity to support, it is important to conduct your own research to ensure the organization is legitimate. There are many resources you can use to research the background of charitable organizations, such as the Better Business Bureau s (BBB) Wise Giving Alliance, Charity Navigator, Charity Watch, or GuideStar. You may also want to consider whether the organization has been granted 501(c)(3) tax-exempt status under the Internal Revenue Code, as well as the accountability and transparency of the organization. Many donors examine what percentage of donations is actually passed on to the individuals supported by the charity, versus the amount used in the administration of the charity. 4

5 Make it Clear that Mary Kay Inc. is Not Endorsing Your Fundraiser or Charity If you choose to tell your customers that you are donating some of your profits from the sale of products to a specified charity, it is important that you do so in a way that does not imply or lead others to believe that Mary Kay Inc. is affiliated with, endorses or sponsors your designated charity, unless your designated charity is The Mary Kay Foundation. Door-to-Door Fundraising Mary Kay strongly discourages any type of door-to-door solicitation or sale of products in support of a fundraiser, as this type of selling is inconsistent with the Company s business model. Beauty Consultants cannot communicate their status as Mary Kay Independent Beauty Consultants if engaging in such fundraising. Media Event If a fundraiser you are sponsoring draws media attention, contact Mary Kay Inc. s Corporate Communications group prior to any interview to ensure you are not misrepresenting Mary Kay s involvement in the event. Likewise, if your fundraiser benefits The Mary Kay Foundation you should also contact Mary Kay Inc. s Corporate Communications Department at (972) or corpcom@mkcorp.com. 5