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February 28, 2008
Typical Prospecting Story
By Truth in A/QMOs
I found an interesting post on a forum where an individual talks about getting prospected at a car show by an IBO. Sadly the way he describes the story happens more often then it should and is the primary reason IBOs have a bad stereotype attached to them.
Recently I was at the Philly Auto Show admiring the new Challenger and a guy started talking to me about how what I do and where i'm from yada yada yada. Anyway he tells me he has a business and he is looking to do business down my way with Circut City and Best Buys and also is promoting a new energy drink. So I left him my number and he gave me a business card and said next time he was in my area we should meet about me helping him with his business in my area. About a week later he gets up with me and wants to meet, he's about 2.5 hours away and I set a meeting up with him and he told me a little bit about his company and how it advertises and markets new products. So when he finally comes down to meet he talking to me about it and then shows me these "motivational" DVD about making 50k in your spare time. Turns out he is an IBO and works for Quixtar. So the information seems all good and nice and he said I can make about 50k by putting in about 8-10 hours a week. So he wants me to meet him 2.5 hours away where he is from for this meeting to learn even more about the business and leaves me with some info and some samples. Well I have never heard of Quixtar and after reading the info he gave me, the fine print, and online research it seems very schemish. Its a borderline pyramid scheme. and its looks like 1 out of every 2,800 people even make 30k with it. The average income for these people are $118 a month. I found some pretty good information on it www.amquix.info and called the guy back and told him I am out of it. Well he gets all offensive and makes it to seem that everyone who says anything bad about Quixtar is bone headed. Well he accused me of being dishonest because I "made" him drive 2.5 hours one way only to not be interested, but I told him that until you actually met me you never said a word about Quixtar and made it seem like it was your business. He didn't have anything to say. Anyway long story short I am glad I got out of this before I put too much money in.
Let's take a look at some of the deception and straight BS in this.
1. Anyway he tells me he has a business and he is looking to do business down my way with Circut City and Best Buys
Flat out lie, the IBO is not looking to do any business with the Circuit City's or Best Buy's. The business has already been done by Quixtar and it is called a Partner Store agreement. Is Best Buy even a Partner Store? Now I know some supporter could come here and spin that statement 9 ways to Sunday, but the bottom line is this IBO was not telling this prospect the way things were.
2. So the information seems all good and nice and he said I can make about 50k by putting in about 8-10 hours a week.
Can anyone show me just one person who makes 50K and all they put in no more then 8-10 hours since they started? If you can show me someone who claims that, I will show you a liar.
3. Well he accused me of being dishonest because I "made" him drive 2.5 hours one way only to not be interested, but I told him that until you actually met me you never said a word about Quixtar and made it seem like it was your business.
Of course in the end the IBO blames the prospect for "making" him drive to see him only to not be interested. I guess it never crosses the IBOs mind that if he had been upfront and honest from the start about this being Quixtar, and the money he was talking about was going to take much more then 8-10 hours he would have saved himself the trouble of trying to sell this opportunity to someone who wouldn't be interested.
Many IBOs make claims that it is because of the "critics" that their business has a bad name. However it is this kind of practice that has indeed been the cause of the bad name. Being deceptive and not being upfront about what is going on only leads to people getting upset. No one likes to feel deceived or lied to. In the end it is not how you feel you can spin what your business is all about, it is how others are going to perceive you. Every other business takes great care in maintaining the best image possible. Perhaps IBOs should learn this aspect of business as well.
February 22, 2008
Fred Harteis Resigns from Quixtar.
By Truth in A/QMOs
Over on Fred Harteis's blog Fred has posted his explanation of his resignation from Quixtar. I found this to be the most interesting part of his post:
"As an IBO I have entered into many discussions concerning issues I have had with Quixtar i.e.: product pricing, the IBO compensation plan, negative on the web."
Negative on the web? Now I know Fred didn't specify exactly, but most of the negative on the web is due to abusive practices by motivational organization leaders. I wonder how many other leaders complained about the negative on the web with Quixtar. Were they looking to Quixtar to do something about it? Isn't that kind of like expecting someone to clean up a mess that you made yourself? The way I see it if the IBO leaders showed more concern for their downline making a profit rather then buying tools and getting tickets to the next great conference there would not have been a mess to clean up in the first place. At any rate I wish Fred well in whatever his next venture is going to be.
February 18, 2008
Wal-Mart and Amway / Quixtar
By Truth in Amway
When I was in Quixtar I remember many times references to Wal-Mart being used. During an open meeting the speaker would tell the prospects that instead of spending their money at Wal-Mart they could buy from their own company and make money. IBOs tell people that Wal-Mart never gave them a check for shopping there like they get from their own business. Wal-Mart this and Wal-Mart that. Pretty much every time a reference to a traditional business was used it was Wal-Mart.
So when I saw an article by Ray Alexander in the Opportunity Zone titled "Not Wal-Mart and never want to be" I couldn't help but laugh a little. The question isn't that IBOs need to compete with the Wal-Marts, Sam's Clubs, etc. It's a matter of IBOs need to stop comparing themselves to them. You see an IBO can argue that the quality of their products are so much better then Wal-Mart till they are blue in the face. But each time you compare the Quixtar business to shopping at Wal-Mart you kill the argument.
I see Quixtar IBOs prospecting people in Wal-Mart all the time. So is it any wonder that they feel they have to compete against Wal-Mart? Not that there is anything wrong with shopping at Wal-Mart, but do you think people who are doing a good deal of shopping at Wal-Mart are more concerned about price or quality? The obvious answer to that question begs this question for IBOs, if your products are of such great quality what in the world are you doing going after a market that is interested in price? Something tells me when IBOs stop comparing themselves to Wal-Mart Ray won't have to tell everyone that Quixtar / Amway doesn't want to be Wal-Mart.
February 11, 2008
More on the Amway Arbitration case
By Truth in Amway
As expected the reversal of the arbitration ruling in the Morrison case has made it's rounds and now the IBOAI, Alticor, and even others are putting their two cents in. Of course most of what is being said I don't think is even addressing the issues. To me it looks like more damage control then anything. At any rate there are apparently some things that the IBOAI want you to know.
1. The decision in this case could be changed in future court proceedings. (Much like how the earlier decision in favor of Amway was later changed in future court proceedings).
2. The Morrison decision was based upon arbitration agreement rules that were in effect in 1998 and have since changed. For instance Amway can no longer make changes to the agreement without the consent of the IBOAI.
3. The dispute arose before January 1, 1998 when the arbitration agreement went into effect and therefore that does not apply to anyone who had a dispute after 1998.
As far as Alticor goes they are trying to say that all Morrison gets is a redo of his arbitration, and that the decision was based off of the fact that the dispute arose prior to 1998. But from the way I read it the court is saying there was no enforceable arbitration agreement because of Amway's unilateral authority to amend.
Other certain Amway supporters have also written on their site that after having time to read the decision "properly" they also see the decision being based off of the fact that there was no arbitration in effect at the time of the dispute. Well apparently time was of no help to read the decision properly.
The way I read it however the final wording in the decision clearly is referring to Amway's unilateral right to amend the agreement. Here is what the final wording is in the decision:
There is nothing in any of the relevant documents which precludes amendment to the arbitration program – made under Amway’s unilateral authority to amend its Rules of Conduct – from eliminating the entire arbitration program or its applicability to certain claims or disputes so that once notice of such an amendment was published mandatory arbitration would no longer be available even as to disputes which had arisen and of which Amway had notice prior to the publication. There are no Halliburton type savings clauses which preclude application of such amendments to disputes which arose (or of which Amway had notice) before the amendment. We accordingly hold that the arbitration agreement was illusory and unenforceable under Davidson as applied to the claims asserted in the instant suit.12 We thus reverse the district court’s October 15, 1998 order staying the case pending arbitration and its September 15, 2005 final judgment denying the Distributors’ motion to vacate the award, granting Amway’s motion to confirm the award, and entering judgment based upon the award; and we remand the case for further proceedings not inconsistent herewith. (emphasis mine)
The reference to Halliburton is addressed earlier in the document where Halliburton's arbitration was ruled not illusory since they could not avoid arbitration by amending or terminating the arbitration provision due to the way it was written. Amway had no such "saving clause".
But as with anything I encourage you to go and read the decision yourself and come to your own conclusion. This case is quite old and many of the rules considering arbitration have changed. But for anyone considering this business I would recommend that you get a good understanding of such processes.
February 9, 2008
Court rules against Amway Arbitration
By Truth in Amway
The Fifth Circuit US Court of Appeals has ruled against Amway/Quixtar in the Morrison case regarding the arbitration decision. From what I gather Morrison lost against Amway in arbitration (no surprise there) then objected to the arbitration when Amway went back to federal district court to get a judgement on the arbitration decision. The district court decided in Amway's favor, and Morrison appealed the ruling. The case ended up with the US Court of Appeals Fifth Circuit and the district courts ruling was reversed and the arbitration ruling was vacated.
The reversal of the decision seems to be mostly based off of the fact that the arbitration was invalid and unenforceable because Amway continued to reserve the right to modify or revoke the arbitration agreement at-will. So basically since Amway was not bound to the arbitration provision they could not enforce it on anyone else.
I have never been a fan of Amway's arbitration process since it always seemed like going to a card game with a stacked deck against you. From the way I understand it Amway trains the arbitrators, Amway could revoke or modify the arbitration provision at-will, and Amway hand-picks the arbitrators. Now I am no lawyer, but it seems to me if all of that is the way the Amway arbitration process works "fair" would not be the first word that would come to mind. So I must say I am happy with the decision and hope that it can possibly lead to a better process that is fair to all the parties involved.
You can read much more about the history of this case and view the actual documents at amquix.info website.
February 4, 2008
New Event Rule posted
By Truth in Quixtar
Over at the Ada-Tudes blog there has been a post about Quixtar's new rule which will allow sales of products at events. Of course as with just about everything in Amway or Quixtar there are restrictions. Here is what was posted as the "pending" rule for event sales:
4.3.3 Event Sales: The display and sale of health, beauty and sports nutrition products by IBOs only at temporary (no more than 10 days) health and beauty shows and certain kinds of sporting events (e.g.: bike race, marathon, 3-on-3 basketball tournament) are permitted. The following information must be received by the Corporation, in writing, 30 days prior to the event, to allow sufficient time to grant approval.
4.3.3.1. A written description of the type of event (including date of event).
4.3.3.2. Name of the specific product(s) to be displayed and sold.
4.3.3.3. A list of specific literature to be used at the booth or for handouts. Any privately produced material for handouts or display must be sent with the booth request for approval.
4.3.3.4. A signed statement from the Platinum or above IBO accepting responsibility for booth activity and include a list of all names of IBOs staffing the booth.
4.3.3.5 A post-event accounting of total volume sold must be provided to the Corporation by the Platinum if the volume sold is part of the qualifying volume for Silver Producer or above for purposes of verifying 70% Rule compliance.
I think the new rule is great and all since I always thought it was completely stupid to allow a booth to be set up at events but no sales were allowed to be made. But, I still don't understand why they need to restrict the sales. I can understand that the health and beauty products along with XS will most likely be the best products to use at an event. But what about having a booth at a festival with a jewelry display?
I also don't agree with IBOs not being allowed to secure a permanent booth somewhere. It was clear in the article that sporting events were allowed but only temporary ones like a tournament or a race of some sort. Personally I don't see the problem with an IBO securing a permanent spot at a concession stand at football or baseball events, or perhaps a permanent booth where other products can be sold. In every other area of business it's a snooze or lose world, so for those IBOs that do what it takes to secure other areas to sell their products should be allowed to do so.