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October 8, 2003
Benefits of retailing
By QBlog in
I had a "moment of clarity" yesterday and thought I'd share it with you.
The greatest benefit of capitalism is competition in the marketplace. Competition creates better products, innovative ideas and keeps prices low. The advantage goes to the consumer who gets new and better products (and services) at cheaper prices.
Within a closed system, such as a monopoly, there is almost no competition and little incentive to improve products (or services), create new ones or keep prices low. With captive customers, the advantage goes to the business monopoly and the consumer suffers.
No, I'm not saying Quixtar is a monopoly. It's not. But, there are some elements of the Quixtar business that behave like a monopoly, especially when retailing to non-Quixtar customers is discouraged. See, within the Quixtar system there is a sort of captive consumer. Each IBO must buy from Quixtar if he wants to get that bonus check. Because there is an almost guaranteed source of revenue from these IBOs, Quixtar has very little incentive to innovate, improve products or lower prices. I'm not making any accusations about their products, just observing that the incentives resulting from competition have been removed.
Now, does Quixtar abuse its customers with bad, overpriced products? I don't know and I'm not saying that they do. That's for you to determine. Some claim to have witnessed such abuses while others claim the opposite. I'm just reporting my humble observation about the Quixtar business and capitalism.
Comments
My personal opinion is that Quixtar has High Quality - High Priced products. This appears to be standard for the MLM industry.
I believe you have hit the nail on the head. If Quixtar IBO's were really required/encouraged to have customers and if Quixtar's corporate volume depended upon sales outside of the closed suystem of IBOs, the prices would have to be more competititve.
Most MLM's charge $50 for a high quality vitamin because they can. Instead of benchmarking with the marketplace, they benchmark with other MLM's. This leaves little place for distributors to retail their products.
Interesting concept. However, consider that the true product of "monopoly" Quixtar and the AMO's is not in the soaps, cosmetics, vitamins or energy drinks. The true products offered to their customers (IBOs) are a sense of belonging to something unique; something that promises friendship; something that promises wealth, something that only a few can be a part of. In other words, hope. The consumable products just become the tangible representation of these conceptual products.
This then begs the question, "Has Quixtar monpolized the MLM market on hope?" Perhaps, because no MLM does it quite like Quixtar with the tapes, books and functions. Certainly there are competitors, but most have positioned themselves in some special niche MLM market (i.e. Mary Kay targets women, Passport targets disgruntled ex-IBOs, others target young adults etc.) Quixtar appeals to and targets the masses.
As you point out, the quality and pricing of their tangible products defy conventional market analysis. However, when you replace the tangible products with the conceptual products, it makes more sense. The customer (IBO) does not shop at the Quixtar market to satisfy his/her need for makeup or food supplements, they shop at Quixtar to fulfill their need for belonging and hope.
This is an interesting thread to me. I am an IBO and market products through Quixtar. I have done some of my own research on product quality/price, costs involved, etc.
I began buying my own products and trying them to see what the real scoop is. Many of the exclusive products that had a higher price than a product of the same type that you might find in a grocery store did in fact have a higher quality.
Another benefit to me by shopping on-line, that my seem obvious, but means a lot to me and my clients, is that I do not leave my house and my products are dropped at my door. The costs associated with shopping for the lowest price are absurd. If I will go ten minutes down the road to pay $3 for an item I can buy in front of me for $7, yet not travel ten minutes down the road to pay $693 for an item that I can buy in front of me for $$697, I have some serious thinking to do about the way I shop. The difference here is still $4 no matter how you look at it. It takes me at least an hour to get cleaned up, drive to the mall, shop for something that I need, drive back and sit back down on my couch. Consider what your time is worth, how much gasoline you used, how many door dings you got, etc. and shopping at home may become an obvious choice.
I don't know what the writer is referring to exactly about an IBO being forced to buy his/her own products. I was not forced to, nor do I have to buy my own products in order to receive a check at the end of the month. I do, however, need to move a certain amount in order to recieve a check. I have never been discouraged from retailing to non-Quixtar customers...this is my business...I want to retail products...I make money that way. Maybe I misunderstood your comment.
As far as the comment about competition being removed or not engaged in, I would encourage the writer to look at our new energy drinks for example. These energy drinks are the best available anywhere with no sugar, no carbs...1carb in one of the flavors..., great taste, competitive price, and many other benefits. Also, I would encourage the writer to look at the Nutrilite brand of vitamins...check out the standards by which they are produced, the contents, pill design, and price. I've been to health food stores and have not found anything that compares in quality or price.
I do understand that in some of the organizations who use Quixtar, there may be some bad things going on. This is not true, however, with all organizations. The association I have had with Britt WorldWide has been rather incredible.
I hope that you will take a new look at the business model that BWW uses to operate the Quixtar business. I have been very skeptical, but after an honest evaluation, have been very impressed. Just my own humble observations...
FYI...
XS Energy Drinks have under $4.00 mark up and 7PV on a case. Hardly a way to make money selling at retail.
Nutrilite Vitamins are 2-3 times the price of competitive products from GNC and Passport LLC.
Another quick FYI...
I have spoken to dozens of people from most every Quixtar organization and every one of them tell their people that they operate differently from other groups, yet when you look at how each one operates, the similaritites are almost comical.
Buy from yourself and teach others...
voicemail
tapes
books
funtions
core
show the plan
share the dream
no negative downline
no crosslining
curiosity approach
never do anything without checking upline
How are you doing? "GREAT!"
(you just ran over your cat)
How are you doing? "FANTASTIC!"
(your car just broke down)
How are you doing? "SUPER!"
Aint it great?
No matter what anyone says, quality will always be subjective. I've said it before and I'll say it again, I've never found the Amway line of products to be worth the extra cost. Just my opinion.
As for the benefits of shopping at home versus shopping at the store, Sears proved almost 100 years ago that with the advent of the automobile, the majority of people will choose to browse a department store, paw at the items and take them home same day then wait a couple of days for delivery. Pre-1900's, Sears did all of their business by catalog. By the end of WWII, Sears did 97% of their business in their stores and 3% catalog. By 2003, Sears still does 97% of their business in stores, and add up their paper and online catalogs, they still do about 3% catalog!
As for costs, shipping versus gas, for some in remote areas I can see where shopping online might be advantagous, but for me, I don't have to travel more than 10 miles, and usually less than 5 to do my shopping. And a 20 mile roundtrip isn't even a gallon of gas for my automobiles. Plus, I work and often shop on my way home, and I pass many stores between work and home, so maybe I go an extra .5 mile out of my way? And since I was at work already, it kind of takes care of the showering part, because if I showed up at work w/out showering, I wouldn't have my job long.
I have read many of the posts related to Quixtar pricing and debate on whether Quixtar products can or cannot be compared to similar products.
Some argue pricing is too high. Some argue the Quixtar product is of superior quality and worth the price. And others say you can't really compare pricing cause Quixtar products aren't sold in stores.
I thought an important point was left out. What do people prefer? Quality? Better price? Free delivery? Most people I've tried to sell to won't switch to a more expensive product if their current lower price favorite already does an adequate job. It makes perfect sense. Many of us buy what ever equivalent product is on special anyways. I can't sell Quixtar's SA8 laundry detergent for $22.75 which does up to 100 wash loads when my potential customer can do 96 wash loads with his Cheer Brand Detergent that cost $8.99.
Furthermore, in my own analysis and use of the products I've tried thus far, I don't see Quixtar's claims that their products cost xx% less than Brand X per use, washload, or whatever to be valid.
I haven't been able to sell anyone anything yet! All my friends are willing to buy from me, yet not for a more expensive product.
Afterall, would you repeatedly run 92 octane gas all year long in a car that doesn't need it? Heck no!
We have tried other Laundry Products and the just don't come close to doing the job. The upfront cost may look like more. But if your only using a 1/4 of a cup or in our case 1/8th of a cup because we have a Kenmore Front Load Washer. They don't have printed on the Box World's Finest Laundry detergent for nothing.
I don't know who said Quixtar doesn't encourage you to sell products. In fact it is a requirement to sell at least 10 Customers a month. There is a lot of profit in Selling Products. You earn about 30% so for every $100.00 you retail you earn $30.00 that not bad at all. I sell Washers and Dryers. Do make $30 I have to sell a $500.00 Washer. So $30 on $100 sounds good to me.
Quixtar is and always will be the BEST Business ever.
Wake up and smell the napalm people! Te lavaron el coco!
http://www.merchantsofdeception.com/files/MerchantsOfDeception.pdf
Hi all.
I agree most of you. I understood the model but was more drawn to the environment versus the products. I have always been skeptical about these types of business opportunities. I believe it can work for those who really need to feel apart of something and feel as if they are getting somewhere with a reward system but if you don't need this, it makes it a little difficult to sell the "plan" to someone else (for me it did - I can't speak for everyone). Although my friends might tell you they think I need the approval of others and seek acknowledgement, I can tell you that I have never needed to be a part of any particular group and have avoided clichés and anything repetitious.
I was excited about the opportunity after some skepticism but it seemed to strip me of my individuality and I didn't have time to pursue my other business opportunities. After hearing the plan for the 7th time, I started to think that this business wasn't for me. The timing wasn't right. DO want to be debt free and have time to do the things I want to do but I was looking to also network as well and talk about things OTHER than Quixtar 24 hours a day. I didn't like the repetition of the information and now feel that I probably cannot be successful if I don't stick to the 9 steps and fit the mold.
There is something out there for everyone and I believe that you can always make a good living at what you are good at just as well as putting your time into an outside opportunity. Quixtar might be for some people but not for everyone.
Been out of business for a few years now. My evaluation did change somewhat after a longer involvement. The business can be a good business, however, it is most definitely not for everyone...me included. If you are a good salesman and are properly trained and equipped, I could see someone doing quite well at it. The problem is that it requires a "downline" to see major increases in cash flow. This downline also needs to be made up of good salesmen. This is very difficult to find. There just aren't that many people out there who are good salesmen. So, you not only need to be a good salesman, you need to be a good sales manager and trainer. The "tools" did not teach me sales techniques, nor management skills. The Amway products themselves are indeed high quality products and I think you will begin seeing more and more people looking for high quality products to put in their bodies. The cleaners and detergents are great. I still use many of them having been out of business for several years now. It seems to me that if a person had this product line and the ability to market in some innovative ways, it could work well. The downline and the "tools" are simply too much to bear.
I thought of something similar to this yesterday regarding cell phones. They announced that government was wanting to give phone number portability to everyone with a cell phone.
This will greatly increase competition because most people don't want to change numbers right now and therefore stay with their current provider.
If a consumer can move to the best deal, the providers will be forced to provide better deals.
Posted by: Inheriter | October 9, 2003 6:38 AM