Quixtar Ada-tudes: A View from the Top : More on Transparency

More on Transparency

Friday, February 23, 2007 by Beth Dornan
Category: Quixtar Strategy, Transparency

I have to admit that as an organization, we've talked more about transparency than we've acted upon it.

I can date the first discussions about transparency to the late 1990s. At that time, we were a little more translucent than transparent. We released very little information beyond retail sales and required disclosures.

But we're changing that. Quixtar seeks to be transparent in providing information that will help increase understanding of its business opportunity. And to provide information that manages the expectations of IBOs about the potential of our opportunity at all levels. Basically, it's to help people understand what the opportunity is, how one earns, what kind of money can be earned, and the time and effort required to achieve higher income levels. And it's a matter of viewing disclosure not as an obligation but as an opportunity.

We're currently working on an overhaul of all of our IBO registration materials, including the Quixtar IBO Compensation Plan overview, known affectionately by its SKU number -- the SA4400. But we're asking our team not to refer to this document by its old nickname because we want to take a fresh approach to what this -- and related communications -- do to inform prospects and others about the business opportunity. This has become a bit of a joke as we refer to it as "the piece formerly known as the SA-4400." Or, "the prince" for short!

But seriously, it means taking a new approach to an old subject -- and turning words into action.

Comments

Tex said: February 23, 2007 4:39 PM | #

Beth,

What are the major differences for the 4400 "Prince" document that are being contemplated?

It sounds like it could be used as a "show the plan" document.

Is this one of the intents?

(Note: I am putting myself on record for being brief and not mentioning the "T" word in the entire post.)

Robin said: February 23, 2007 4:54 PM | #

Nice job, Tex!

The document Beth's referring to is still in early planning stages, but it is meant to provide necessary disclosures while educating prospects about the Quixtar business opportunity.

ibofightback said: February 23, 2007 6:19 PM | #

Geez ... I was going to ask a question about transparency as it related to IBO organization, but after Tex's post and restraint I feel a bit guilty! Bah ... what the heck!

Do you have any info or comment with regards to transparency and various IBO organizations? Has Quixtar and IBO leaders discussed that issue further, along the lines of the Accreditation program?

Tex said: February 23, 2007 8:21 PM | #

It wasn't easy....

Need any input? I would happy to sign an NDA.

Chuck said: February 23, 2007 8:23 PM | #

One way the company can help in managing the expectations of its IBOs is by laying out fairly accurate examples of the cost of doing business and a range of examples about when an IBO can reasonably expect to be profitable. By profitable I mean the point when a particular level of PV/BV less expenses results in some level of income before taxes that might be termed discretionary and spendable. Some might say that an IBO needs to be at the 1000 PV level before he might turn the corner on profitability, assuming he doesn't have large system expenses. I am not saying the company has to nail down the exact specifics of the numbers (that would be impossible), but I believe a general range might prove helpful. I may be on a fool's errand with this, as it just may not be remotely possible with any kind of accuracy. However, even just compiling a reasonable list of many of the direct costs of doing business, including costs associated with business support materials, would likely prove helpful to newcomers with limited business experience or backgrounds.

Also, rather than saying the average Emerald or Diamond earned a certain amount, it might be more helpful to say that the average new Emerald earned "x" and the average new Diamond earned "y" in the year following reaching the Emerald or Diamond level. Unless I misunderstand how those numbers are reached (and that is possible), the long-term pin holders tend to skew those average numbers a bit.

Tex, thanks for letting the "T" issue go for awhile. We all had beaten that one to death. It will be a nice change to talk about something else and I am interested in reading your thoughts on other topics as well.

Chuck

Jeffrey said: February 23, 2007 10:54 PM | #

I would like to say I've also been guilty of postings that are too long and I've ragged on and on about some of the same issues. But, I do have one thing to say: I believe this is the very best business opportunity in the world and I am glad to be a part of it. I think with some of the changes that are in the works, and some already here, like these blogs, I believe we are on the verge of a PV explosion like we've never seen. And on another positive note, good ole mom called today and placed a $72.00 order and a friend yelled at me as I was leaving to run some errands and said, "I want to get with you next week to look at your business." As the ad says, "It's been another great day."

--Jeffrey

Tex said: February 24, 2007 12:14 AM | #

Chuck,

The average Emerald and Diamond income numbers are based on currently qualified pin holders, according to my conversations with Q.

In many, if not most cases, if the corresponding founders pin is not reached within a year or two, chances are real good they no longer qualify for the original pin.

As you probably know, there are many more Emeralds and Diamonds than there are Founders Emeralds and Diamonds. I would estimate the number is something on the order of 50 to 1.

Even a founders pin only means the volume levels were held for 12 months rather than 6 months, but at least there is a somewhat better probability the original non-founders pin is still being earned.

This means the lifestyles you see are also probably propped up by the "you know what" subject.

I believe you were thinking the long term pins were skewing the numbers up, but the actual average Q income of a long term pin is likely much less than what is advertised in the averages. But then, the lack of transparency has resulted in us not really knowing the answer.

This is yet another reason the "you know what" subject is so critical, it infiltrates so many critical topics regarding this business.

Once you begin to understand the full impact of the "you know what" and its impact on many far reaching issues, you will realize how critical it is to fix.

Why the average prospect and IBO should not be privy to this information is beyond my understanding and belief what the term ethical means, and is the crux of true transparency.

I really don't like beating around the bush and using "code words", but you and others have insisted I do, to the detriment of others reading these messages and not understanding what "you know what" stands for.

I hope not using the "trigger word" has helped you understand how important it is when discussing this business.

ibofightback said: February 24, 2007 9:20 AM | #

Chuck,

Re "a range of examples about when an IBO can reasonably expect to be profitable" .... my first thought is to drop my jaw and think - HUH!?!?!? Aren't you doing this with new IBOs already? It's going to depend on the individual IBO and their short and long-term goals, so I don't think it's something the corp can particularly do, but my upline certainly talked to me about expected break even points and I do it with all new IBOs I introduce. The first goal in any business, this one included, is to reach revenue neutral - ie break even.

Re the average incomes, some clarification is definitely needed. For example, all Diamonds are platinums - does that mean the average platinum income calculation includes all Diamonds? I doubt it, but critics have claimed such things.

Skip F said: February 24, 2007 11:13 AM | #

Beth,

What about IBO's that don't want to be part of a system. Don't you feel Q has a responsibility to make the same things available that systems offer so non- system IBO's still have support.

Porkchopjim said: February 25, 2007 9:52 AM | #

I hope that part of the new disclosure of income potential will include a section on how IBOs get 'paid to use their own products' and any other compensation given to IBOs that is related to the buying vs. selling of products.

Additionally, any justification that you can provide for IBOs who increase their self-consumption to build volume at the personal circle level vs. retailing to customers would also be appreciated.

While it's easy to understand the reason for people getting into direct sales was they had used and like the products, it's not very easy to understand how buying the majority of the products you sell at the individual level benefits the IBO unless that IBO focuses on recruiting duplicates that pass volume up.

Those activities are being done by IBOs both within the framework of your current business rules and associated with some presentations of the opportunity, whether explicitly endorsed by Quixtar or not.

- Porkchopjim

Tex said: February 25, 2007 1:53 PM | #

ibofb,

Drop your jaw all you want, what Chuck described is the norm in many, if not most, LOS's. I think you know why I think this is so. The time to attempt to indicate surprise and shock over this revelation ended months, if not years, ago. Especially from you.

Porkchopjim,

Let's first get IBO's to show the plan according to the current rules before changing the rules. As I stated on another thread, I went to a recent open where neither the words "Quixtar" or "retail" were even uttered.

We can then discuss whether the current retail rules are adequate.

Tex said: February 25, 2007 1:57 PM | #

ibofb said: Re the average incomes, some clarification is definitely needed. For example, all Diamonds are platinums - does that mean the average platinum income calculation includes all Diamonds? I doubt it, but critics have claimed such things.

Tex said: Again, you are being intellectually dishonest. I stated above, and have stated to you previously, Q counts ONLY CURRENTLY qualified pins in their figures. I don't mind if someone from Q confirms this in writing on this blog, but let's move the discussion forward, rather than dredge up old lies and myths. By the way, I have never seen a critic say what you said, above. Care to provide a link?

Chuck said: February 25, 2007 4:14 PM | #

ibofightback,

I do discuss what I believe to be the breakeven point in income, even though it certainly isn't an exact science. My point was simply that I thought it would be best if Q/A had those kind of numbers in print and on the record so there wouldn't be any confusion about how it sees that particular issue. Thanks for the question and allowing me to clarify what I meant.

Tex,

I do understand that the tool issue leans against many other issues. But since we all know that, by keeping it somewhat out of the discussion for a period of time, I think it will allow us to take some of the level than might otherwise be the case if the tool issue was always the primary topic of discussion. I understand the the tool business tends to have a big impact on the "climate" of the business, but I am also interested in hearing more about how other IBOs feel about the "daily weather" (other issues that may or may not be affected by the tool issue). BTW, thanks for your clarification about the averages being the incomes of currently qualified pin holders. That obviously would give a different number than the average of all former and current Diamonds still active in the business.

For the blog, what other topics or issues do your believe the company should discuss or disclose in a new "Prince-type" document?

Chuck

Beth Dornan said: February 26, 2007 9:13 AM | #

Skip, you raise a very valid question. Our position, which is stated all over the registration process, is that participation in BSMs and systems are voluntary and optional (and covered by a satisfaction guarantee, etc.) But that doesn't mean you're on your own if you choose not to participate.

There is support available through Quixtar and has been stated elsewhere, you'll see more tools and training available to all through Quixtar.com and elsewhere.

What we do need to hear is what would be valuable to IBOs....do you need more hard-hitting selling tools? Selling training?

Beth Dornan said: February 26, 2007 9:22 AM | #

Note to Porkchopjim:

You've seen us talk a bit here about the idea of "balanced businesses." Balanced businesses combine selling products to customers, some personal use, and sharing the opportunity with others.

This will definitely be part of the new disclosure and plan documents.

For new IBOs, the balance may be tilted toward retailing as it's the quickest way for a new IBO to make money, by earning retail profit as well as bonuses based on volume.

Beth Dornan said: February 26, 2007 9:33 AM | #

IBOFightBack & Chuck:

In terms of disclosures, what you are describing are the types of disclosures we are discussing -- including average earnings at various levels and the average time to get there.

IBO FB: You raised a question about average Platinum income including Diamond income. We would not calculate the averages that way. We would do it based on a specific qualification level during a specific period of time -- for example, a Q12 Platinum during the 2006 qualification year. Likewise, we would do a qualified Diamond, Emerald, etc. during a specific period of time. What you describe above sounds like double-dipping.

But I would challenge your assumption that IBOs need to get to a breakeven or "revenue neutral" position -- people coming to Quixtar to make money need to make money as soon as possible!

Tex said: February 26, 2007 11:24 AM | #

Beth,

Do the average Platinum income numbers include the one-time bonuses? If so, how many Platinums, by rough percentage, are "first-time" Platinums, and how many are "repeat" Platinums? This could be the source of "skewing" that would be an interesting piece of information, as most people are more concerned about the longer term profits, as opposed to the "one hit wonders" of a new Platinum.

Chuck,

In all honesty, I can't think of much else I would change about Quixtar other than ensuring transparency on the tool issue. You may think I am saying that for the ulterior motive of staying focused on the tool issue, but I am not.

Also, although I think it is good Quixtar is getting more involved in the tools, they should, in my opinion, keep it as simple as possible, or they could find themselves causing more confusion than assistance, and creating the need to apply Sx3 (see other thread) to the tools as they are doing with the products.

Tex said: February 26, 2007 11:29 AM | #

Beth said: What we do need to hear is what would be valuable to IBOs....do you need more hard-hitting selling tools? Selling training?

Tex said: The biggest help would be a generic marketing plan to show prospects, as this information has the most limiting restrictions and required approval. The generic plan could include different patterns that could be selected, such as a 6-4-2, 9-4-2, "stacking", etc. Someone mentioned you were willing to work with them, but it took 5 months to get their plan acceptable to use. This process shouldn't be this hard, and an approved plan would really help. I think the various corporate web sites are adequate for follow up purposes, it is the front end that could benefit, that is why I asked about the new "Prince 4400" document.

Piet said: February 26, 2007 11:30 AM | #

I go to the More on transparency blog, I go to the 3xS blog, I go to the Focus on the new IBO, The transparency & responsibility blog, and even to the Welcome blog, and it is Tex, Tex, Tex and Tools, tools, tools.

We understand now that you have a problem with the tools. Now get over it, and stop hogging the conversation. It is impolite.

Tex said: February 26, 2007 1:34 PM | #

Piet,

When about 2/3 or more of profit to Emeralds and above is from tools and the price of tools are the direct cause of unnecessary net loss for most IBO's, I think it is an important subject.

After all, this is a business (technically 2 businesses, A/Q and tools) and business is money.

Now get over it, it is impolite to ignore the elephant in the living room.

I have commented on other issues as well, but this is THE big one, as even a casual observer would agree.

Chuck said: February 26, 2007 1:37 PM | #

Beth,

Thanks for the response. Perhaps I am a bit misguided on the "break-even" issue. Let me explain where I am coming from and I'd be interested in hearing your perspective in return. When new IBOs come into the business I don't believe many of them have a clear understanding of the ongoing costs associated with building their businesses. If they are involved with their LOS' system on a moderate level for monthly training and also attend monthly and weekend system functions they are likely going to invest somewhere in the vicinity of $900 to $1,200 a year. For a couple it would likely be $500 to $600 more. This does not include airfare and hotel expenses related to those weekend events. If they are involved with other system provided resources like communication services and websites the cost would obviously increase. Add to that automobile related expenses, etc. related to building a business and you can come up with some kind of monthly expense related number for the IBO showing the plan ten to fifteen times a month.

Lets just say its $150 a month. I think it is important for the new IBO to know that it requires a particular level of volume to reach that break-even point. I am sure their upline fully expects them to participate in the system at some level. In fact, virtually all line of sponsorship related award levels include system participation related requirements. You cannot be honored by your LOS at a function for many awards on the way to Platinum if you and a number of IBOs in your downline are not participating in the system side.

I am not beating at the tool issue here. I do see the value of the tools on some level at appropriate pricing. I am simply speaking to the notion of making sure new IBOs know ahead of time about many of the costs associated with building the business, and the level of those costs, that they will be asked and expected to consider when they join the business and a particular LOS.

To say "expenses will vary" or that "tools systems are optional" is to avoid the realities associated with the business, and I think that is what creates many of the tensions in the business and the ill will some people harbor toward the business after they have been involved for awhile, which in many ways is really ill will toward the systems, not the company itself -- unless the company continues to avoid facing those issues. It appears that is changing, which will benefit everyone.

Thanks again, Beth, for your response.

Chuck

ibofightback said: February 26, 2007 2:35 PM | #

Beth - you can't go into profitability without first reaching revenue neutral - even if it's just earning enough to cover yearly renewal fees. :-) If you are actively building you are going to have expenses. Travel, training, office expenses etc etc. Any business person, including an IBO, needs to work out, at least approximately, what those expenses are going to be. A major milestone in pretty much any business is to be able to cover your running expenses - now you're in the black!

Chuck - I really don't see how the corp. can give the type of figure I think you're looking for. Expenses can and do vary dramatically from IBO to IBO depending upon their individual goals and circumstances. You might however be interested to know that Amway Europe actually has BSM spending limits for IBOs in their first 3 months of business (a bit over US$100/mth). Obviously other expenses will vary, but that kind of approach may achieve the same end goal you are looking for.

Porkchopjim said: February 26, 2007 10:05 PM | #

Ms. Dornan,

Your description of ‘balanced business’ as a combination of selling products to customers, some personal use, and sharing the opportunity with others is no different than what is currently described in the business rules.

I think you are mistaken when you say: ‘For new IBOs, the balance may be tilted toward retailing as it's the quickest way for a new IBO to make money, by earning retail profit as well as bonuses based on volume.’

The new IBO doesn’t have a substantial downline. The only money a new IBO can make is by retail. Otherwise, please explain how a new IBO can ‘earn money’ based on volume IF they have no downline.

‘Tilting’ sounds like a temporary position. There must be a ‘break point’ of moving from retail – for the new IBO, to more than ‘some use’ that you advocate in your statement – else why the ‘tilt’ to retail? The only other option is: share the opportunity.

DSA, ten years ago (plus?), advocated self-consumption as an important part of network marketing in a survey study. I don’t think anyone can argue with that. Their figure was up to ‘one third’ of ‘retail sales’ were to participants themselves. I don’t think anyone can argue with that, either.

Is about one third self-consumption the number you plan on using to illustrate the business model? And if it is, on what evidence do you base that on – given the prevalence of ‘buy from yourself’ models based off of the Quixtar Opportunity…which has been estimated as high as 95% but more likely 80% self-consumption?

Thank you,

- Porkchopjim

Tex said: February 26, 2007 11:21 PM | #

ibofb,

I don't think the corp. should give the type of figure Chuck is looking for, the corp. should require the tool companies to provide the costs for ALL recommended tool costs, and the resulting profit the higher pins make based on those recommendations. There are no similar BSM spending limits in the US, making the above transparencies even more important for the US IBO's.

Piet said: February 27, 2007 12:19 PM | #

Tex said:When about 2/3 or more of profit to Emeralds and above is from tools ...

The link you provided, has ONE diamond and ONE emerald earning 2/3 of income from tools. The emerald clearly says that he had a badly structured business!

Even if that was the case for all Emeralds and above in their BSG, it does not make it valid across all business support groups. Making that deduction is as incorrect as deducting that because Dutch lived in South Africa, and South Africa had a policy of apartheid, therefor the Dutch had to be responsible for apartheid.

IBO FB said: Any business person, including an IBO, needs to work out, at least approximately, what those expenses are going to be.

Piet said: I couldn't agree with you more - and he needs to work it out for what his particular situation is. That includes how much start-up capital he has, how he wants to structure his business, and that should drive his budgeted expenditure on training, education, travel, etc, etc.

I cannot see how Q/A can do more than they currently do - provide averages of income at certain pin levels, and then to also explain how the revenue is calculated. From there onwards it is up to the individual business owner to make his own calculations.

Beth Dornan said: February 27, 2007 1:46 PM | #

Pork Chop: Sorry if my use of the word "tilt" or "tilted" implied a temporary position. IBOs who develop a retail customer base are wise to build and maintain that base as a source of volume plus retail profit.

Don't assume that just because there are three parts to the balanced business equation that all three will be in equal proportion -- to the point I made and you reinforced, new IBOs make money be retailing products. And yes, at some point they may start recruiting and showing the plan. But the dollars in their pockets will come from selling products and getting the retail commission in addition to bonuses from overall volume.

Beth Dornan said: February 27, 2007 1:52 PM | #

IBOFightBack: I think we're talking the same thing but in different words. An IBO needs to earn more than he's spent, and that does include registration and renewal fees!

It also needs to take into account any optional and voluntary investments in support from an LOA, travel expenses related to their business, etc.

R. Jason Eades said: February 28, 2007 4:56 AM | #

Aren't we complicating these things a little much.

I've ALWAYS been told and I've been in 10+ years that any and all tools and training purchases have been UP TO ME whether or not I deem them worth the cost.

Aren't we setting people in their OWN business's to make their OWN decisions based on their OWN goals and dreams? If we really have support tools as "unmandatory" as we do, a formal extrapolation would be useless on the part of Q?

My suggestion is this, stick with IF you run this volume, THEN you get this much from the company. and leave the retailing suggestions and tools to the uplines who actually KNOW the IBO's. If you want a solution to initial profitability look into raising avg. PV across the board without raising prices.

Hope this didn't sound hostile.

Tex said: March 1, 2007 12:12 AM | #

Actually, it is very simple. Listen to Rich Devos' "Directly Speaking" tapes, available on the internet by googling "Directly Speaking Amway", and you will find nothing has changed, except the internet has exposed this long-standing problem.

I've been in over 10 years also, and have always heard, and heard MANY others say on various blogs, "The tools are optional, but so is success". I have also personally experienced a total lack of ANY contact from upline, let alone support, since going off the standing orders, and have heard of similar stories from many others on various blogs.

If you continue to leave the business up to the upline, the 24+ year pattern of upline making MUCH more from tools than from A/Q products will continue as well. How much longer do you want the flat growth to go on, it is now 10+ years and counting? Do you really believe it will stay flat, with the tool profit facts becoming better and better known on the internet?

I hope this sounds "hostile", because the hundreds of thousands, if not millions, of IBO's that have been victimized by this complete lack of transparency (that is the topic of this thread, by the way, and the nicest term I can use to describe this situation) regarding tool profits deserve to have the truth out in the open.

Not to mention the future IBO's, who will be similarly subjected to tool systems that are hostile to their financial future.

ANYONE who turns their back on this issue simply doesn't care about the future of the Quixtar business, in my opinion.

I don't expect massive overnight changes, but I do expect regular updates, forecasted plans, and further dialog from the various Quixtar OZ posters regarding this issue.

ibofightback said: March 5, 2007 11:57 PM | #

And I have personally experienced large amounts of support from upline despite going "off system".

Just because LOC was sold 50 years ago and LOC is sold today is not justification for saying "nothing has changed".

What's lost sometimes is exactly how BIG this business is. Yes there are problems. Yes people do the wrong thing. But there's many many many people with positive experiences doing the right thing.

Tex said: March 6, 2007 1:35 PM | #

And I have personally experienced large amounts of support from upline despite going "off system". ----------------------------------------- I am happy for you, now the readers can make a decision if you are the exception or the rule, based on other information available on the internet.

Just because LOC was sold 50 years ago and LOC is sold today is not justification for saying "nothing has changed". ---------------------------------------- You're right, but the same things Rich said in 1983 are now coming to fruition via the numerous lawsuits, not to mention the unknown number of arbitration proceedings that have taken place.

If it's such a big problem, why, given the internet has been around 10+ years now, is there so *few* complaints on the internet? Scott Larsen on Amquix gets twice as many letters from people supporting A/Q or researching it than he does of people reporting any bad experience. We've already been through the fact the BBB and FTC get very few complaints. ------------------------------------- There are several lawsuits, which represent hundreds of thousands of IBO's. Most people don't go to the trouble of complaining, they just move on with life. It is reasonable there were campaigns of "amquix bombing by IBO organizations to make the numbers look more favorable, something that would be impossible for disenchanted IBO's to pull off effectively.

What's lost sometimes is exactly how BIG this business is. Yes there are problems. Yes people do the wrong thing. But there's many many many people with positive experiences doing the right thing. ----------------------------------------- Yes, that is lost "sometimes". We could have a much better idea of how BIG the problem is if people like you asked their upline how much they make on tools. But there are many many many people who are too afraid to ask this very simple but critical question, either because they don't to experience the "wrath of upline" or it may prove them to be wrong. This is the right thing to do, however, if you are being honest about determining how BIG the problem really is, ibofb.

ibofightback said: March 6, 2007 10:22 PM | #

"readers can make a decision if you are the exception or the rule, based on other information available on the internet."

What, that given the millions of IBOs over the years, a tiny tiny fraction of 1% of them have ever reported this? Sure, they can make their own decisions.

"the same things Rich said in 1983 are now coming to fruition via the numerous lawsuits"

"There are several lawsuits, which represent hundreds of thousands of IBO's."

One person filing a suit does not mean it "represent(s) hundreds of thousands" Tex. That's an utterly false assertion.

"We could have a much better idea of how BIG the problem is if people like you asked their upline how much they make on tools"

Piet said: March 7, 2007 10:10 AM | #

Tex said: It is reasonable there were campaigns of "amquix bombing by IBO organizations to make the numbers look more favorable, something that would be impossible for disenchanted IBO's to pull off effectively.

Piet says: Come on Tex, get real. Now you're beginning to see conspiracies!

Open your eyes - all that is happening is there are a couple of you guys moving from blog to blog and talking up a storm, with no facts to back you up, other than vague assertions from other blogs, quoting each other in a circle. And when people outnumber your opinion, it is because the site is being bombed?!?

Wake up and smell the roses.

Tex said: March 7, 2007 10:23 AM | #

What, that given the millions of IBOs over the years, a tiny tiny fraction of 1% of them have ever reported this? Sure, they can make their own decisions. ----------------------------------------------- The alternative is to provide the whole story of tool profits. Let's start with you ibofb, how much does your upline make on tools? Since you "don't care" how much they make, it shouldn't be any problem posting the numbers, right?

Really? Where? The california one is a joke, as you know. The other main one at present is a fight between former business partners who run a tool company. As such it has little to do with IBOs per se. -------------------------------------------- You don't know California, do you? There is no predicting what a California jury may decide, it isn't called "the land of fruit and nuts" for only one reason.

Once the news of an unfavorable decision is splashed in the media and blogs, stand by for all h*ll to break loose.

It will take years to get another court to overturn a decision.

Who do you think pays for the "tool company" lawyers' fees? That's right, just like everything else, the end user of the product, the IBO's.

Not to mention the disruption to the "edification" that has gone on for decades with the same higher pins that are not IBO's anymore. Doesn't affect IBO's "per se", yeah, right.

There are also a number of other lawsuits that have uncovered the tool profits and the conflict of interest that results. Get a clue, ibofb.

One person filing a suit does not mean it "represent(s) hundreds of thousands" Tex. That's an utterly false assertion. ------------------------------------ See above, with respect to tool prices and edification, ibofb. Major portions of entire organizations "vaporize" when something like this occurs. It is an utterly true statement.

But Tex, don't you understand? If I don't think there is a problem, if I'm happy with what I pay and what I get for it - then there *isn't* a problem. Doesn't matter if my upline is making a billion dollars on tools or zero. I don't care. -------------------------------- I understand. You want to keep giving the patient (A/Q) blood transfusions (new IBO's), when you should be doing something to stop, or at least slow down, the bleeding (prospect who don't joint or IBO's who quit after learning about the tool profits).

For years, there wasn't common knowledge the patient was bleeding, but those days are over.

Guess what: I don't care that you don't care. I do.

Ano said: March 7, 2007 1:10 PM | #

Q "Connections" is June 9th. I Wonder how many systems will support this? More info on Q site.

ibofightback said: March 7, 2007 8:11 PM | #

"IBO's who quit after learning about the tool profits"

How do they manage to do this, given Quixtar puts it in the paperwork they have to sign to *become* an IBO?

Ano said: March 8, 2007 5:35 PM | #

They just don't renew!

Tex said: March 10, 2007 6:53 PM | #

ibofb,

How many times do you have to ignore the simple question?

Most prospects and IBO's are not aware of the LEVEL of tool profits, which commonly are 2/3 or more of an Emerald and above's income. It is the LEVEL of the income, the distortions of incentives, and the downright lies that are continued through this issue.

Tex said: March 10, 2007 11:22 PM | #

They are told in a very superficial manner, and generally are not told HOW MUCH money is made via tools. Even Q's new DVD which is now online is not completely honest (transparent) about the level of tool income, as the impression is NOT most emeralds and above make 2/3 or more of their income from tools.

Editor's Note:

A portion of this comment has been omitted for violating the civil discourse aspect of Ada-tudes' comments policy. Numerous other comments recently have come close to falling outside the bounds of civil discourse.

While I appreciate that everyone is very passionate about their viewpoint, let's please take care to focus on the issues and not critique the value of others' posts. Although you may disagree with them, other commentators have just as much right to contribute to the conversation here as you do and all opinions and ideas are welcome. "Civil discourse" means more than just not using profanity or name-calling. It means respecting other bloggers and expressing your opinions courteously. Please help keep the tone of Ada-tudes as respectful as possible.

Thanks,

Anna Bryce
Managing Editor -- Opportunity Zone

Piet said: March 12, 2007 6:07 AM | #

Tex said: How many times do you have to ignore the simple question?

Piet says: How many times will you ignore the answer? Can you please continue this discussion on the "tools" thread?

Tex said: March 12, 2007 11:13 AM | #

Piet,

This is a thread on transparency, and tool profit transparency is the most significant area that needs more transparency.

I am merely continuing the discussion that was already ongoing on this thread. When adatudes posts a "top 3" threads that includes the tool profit discussion, I would be glad to move this discussion to that thread.

Why don't you answer the question on that thread, I have asked you the same question on that thread as well?

Piet said: March 13, 2007 10:31 AM | #

Tex: Q has created a thread on tools, why do you want another one on tools??!

Tex said: March 13, 2007 2:42 PM | #

I didn't say I wanted another thread on tools.

I would like to move the "top 3" existing threads to a more visible location on the blog, as the tool thread will eventually get pushed down so far when new threads are started it will essentially "disappear".

Joecool said: March 14, 2007 3:34 PM | #

Good grief Tex,

If you want to have a blog with "your" structure", go start your own.

Tex said: March 14, 2007 9:34 PM | #

Good grief Joecool,

Don't you want more visibility to the more important issues?

Piet said: March 15, 2007 10:05 AM | #

With Tex around, the tool issue will NEVER disappear!! :-)

Tex said: March 15, 2007 3:54 PM | #

Piet,

Without Tex and like-minded individuals like Chuck and Skip around, the tool issue would hardly be talked about at all on this blog, but the other blogs would ensure this business would continue to struggle, and probably "disappear" itself at some point.

The first step of solving a problem is admitting you have one in the first place. Rich Devos admitted it in 1983, and it has never been fixed. Ignorance is NOT bliss.

Piet said: March 16, 2007 2:41 AM | #

Three against the world!!

Go Tex go.

I've also never believed in running with the crowd.

But...every now and again one does have to make a reality check.

Tex said: March 16, 2007 10:52 AM | #

Piet,

I forgot one.....Rich Devos.

Checkmate, we don't need a crowd.

Besides, I would prefer to be by myself than to run with a crowd I don't respect.

Plus, there are MANY more with the same opinion, although many of them have had such a bad experience they would rather see Q go away as well.

Ever read any of the other blogs?

The 3-4 of us are hardly alone.

Joecool said: March 16, 2007 2:57 PM | #

Tex, I agree the tools issue is important.

The problem is you are running around asking blog owners to restructure their blogs to suit your issues.

Start your own blog - then you can talk exclusively about tools if you wish. I think the business has other inherent issues that I wish to discuss, nut just the tools.

Tex said: March 16, 2007 3:32 PM | #

JC,

I have "run around" asking blog owners to restructure their blogs to give better visibility to the bigger issues, rather than the blogs being an unorganized "stream of consciousness" (see this link for a definition of the term: http://en.wikipedia.org/wiki/Stream_of_consciousness_%28psychology%29).

Why would I go off into my corner of the web and describe the tool issues? I have better visibility here with the people I am interested in reaching; namely, Q, other IBO's, and the higher pin IBO's.

Also, I have discussed many other issues besides the tool profits. However, I also believe the tool profit issue is the most significant and critical for the long term future of this business.

P.S. Anna, is this post better (shorter)?

[EDITOR: Actually, it's still Robin administrating on Anna's account. She's on vacation. It's shorter.]

Joecool said: March 16, 2007 5:37 PM | #

Tex, you can't go around hijacking everyone's blog topics to make your point. That is why you have been banned by so many websites.

Tex said: March 17, 2007 8:47 PM | #

JC,

It is your inaccurate interpretation that I am "hijacking everyone's blog topics".

What I have really done is point out how the tool profits directly and indirectly affect virtually every other aspect of this business.

For those familiar with technical fields, it is called root cause analysis, and is a technique pioneered by the aviation industry to create one of the most reliable and safe means of transportation.

When many issues can be traced to a single influence, you have completed a successful root cause analysis, and need to fix the subject issue.

In this case, it is excessive tool profits.

Piet said: March 19, 2007 7:06 AM | #

Piet says: Tex, when you did your "root cause analysis", I assume the effect that you were looking at is the lack of growth at Q? Because the rest of Alticor is still growing at a rapid pace, excluding the Chinese market. And the root cause there is the regulatory issues with the Chinese government.

So what were the other causes that you investigated during your analysis?

Tex said: March 19, 2007 1:46 PM | #

The root cause analysis would have identified the tool profits being a problem long before the lack of Q growth for the past 10+ years.

Rich Devos identified it in 1983, and he probably never heard of root cause analysis.

However, the internet has exposed the problem, leading to the flat growth.

The tool systems are not as entrenched in many foreign countries, because:

1. Most people literally can't afford them,

2. Having them available in a multitude of languages makes having tools a much bigger job than in English speaking countries.

The purpose of a root cause analysis is to get to the "root" problem. The theory is all other apparent problems are symptoms of the problem. The apparent problem that answers the highest percentage of apparent problems (symptoms) is the root cause problem.

The other major issue with the business in my view is the lack of retailing, although even this has a connection to the tool profit issue. There are only 24 hours in a day, and since tools make much more profit for the higher pins, they emphasize tool consumption at the expense of retail sales emphasis.

What other causes for the flat growth do you see? How much does your upline charge for tapes/CD's, books, and functions? How much profit do they make on tools compared to A/Q?

Joecool said: March 19, 2007 1:54 PM | #

Tex, are you contending that lower tools prices will result in a higher IBO success rate?

Piet said: March 20, 2007 3:16 AM | #

Come-on Tex, you do a root cause analysis of a USD 1 000 000 000 company, and you come up with "tools" and "lack of retail"?

I asked what other causes you investigated, and you give me ONE!

Tex said: March 20, 2007 7:57 AM | #

Yes. Isn't this obvious?

Tex said: March 20, 2007 8:12 AM | #

Getting back to the topic of tansparency, I noticed the lawsuit against Randy Haugen for the P&G cult gaff in 1995 was decided in front of a jury, with $19.25 Million going to P&G for the false statement.

There are a couple of issues that will test the stated desire for transparency:

1. The article I read (http://www.chron.com/disp/story.mpl/ap/fn/4644827.html) refers to these individuals being "ex-distributors". Is this true?

2. The same article indicates the $19.25 Million judgment is being paid via liability insurance. Is this the insurance all IBO's have access to, or a separate policy(ies) these individuals have?

3. The same article says an Alticor spokesperson, Kate Makled, made the comment Alticor has "research" showing the wrong decision was made by the jury. Since the corp. made this comment, it would be useful to know the nature of this "research" that would overturn the judgment against the IBO's. If you make a statement like this, you really need to back it up to some extent, instead of throwing out a gratuitous "red herring". You don't have to describe all of the "research" in detail, but some general description should be made to back up this statement.

You say you want transparency, here's a great chance to give us some. Simple questions, simple answers.

Beth Dornan's Response:

Transparency is one thing, truth in reporting another.

The defendants in this case are current Quixtar IBOs, not former IBOs as your source suggests. And the statement attributed to Alticor's Kate Makled was not quite correct -- she had answered a question about some shared resources in previous phases of this case, not that she would "share research."

And regarding the third question about how the claims would be paid, we simply don't know. That's a question for the defendants.

Tex said: March 20, 2007 11:24 AM | #

My "Yes. Isn't this obvious?" answer above was meant for JC regarding his lower tool and higher success rate question.

Piet, I looked at many issues, they were all determined to be causal factors, not the root cause.

Piet, why don't you do your own root cause analysis? There are plenty of resources on the internet you can use. Or, give me a list of issues that you are aware of, and I will trace them back to the tool profit root cause for you.

Tex said: March 21, 2007 4:05 PM | #

Beth,

Thanks for the response. I was referring to the Q liability insurance that is offered to all IBO's when we signup/renew. Is this the insurance they are using to pay the fine?

Editor's Note:

As stated in Beth's comment above, we aren't privy to how the claims would be paid. That's a question for the defendants.

Katie Pearsall
Editor -- Quixtar Opportunity Zone

Tex said: March 25, 2007 2:59 PM | #

Beth: And regarding the third question about how the claims would be paid, we simply don't know. That's a question for the defendants.

Tex: I guess the real question is, COULD these types of penalties be paid with the business liability insurance that is available to new and renewing IBO's as part of the registration process?

Beth Dornan said: March 26, 2007 9:50 AM | #

Tex: The Independent Business Owner Business Benefits Association coverage is detailed on page C-3 of the Business Reference Guide (available as a PDF at Quixtar.com.)

Tex said: March 27, 2007 7:24 PM | #

Beth,

Thanks for the reference. Below is the subject section. It is not clear to me the applicability of the words "advertising injury", below. For instance, the Randy Haugen voice mail could be considered an "advertising injury", but we all know the nature of insurance companies is to take a very narrow view of actual coverage. Just ask the thousands of folks along the Gulf Coast after hurricanes Katrina and Rita, almost two years ago, and they STILL haven't seen a single dollar from their insurance companies, although many of us have seen the news stories which would imply they should have been paid long ago.

[A portion of this post has been deleted for brevity. The Independent Business Owner Business Benefits Association coverage is detailed on page C-3 of the Business Reference Guide (available as a PDF at Quixtar.com).]

Editor's Note: all questions concerning this policy should be directed to the Independent Business Owners Benefits Association (IBOBA) through which this policy is available as they are the experts. The IBOBA can be reached at 800-548-9175.

Katie Pearsall
Editor -- Opportunity Zone

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About Beth Dornan

I’ve been writing professionally (published) since I was 14, which means I’ve now logged 30+ years as a writer. I grew up in Northwest Indiana (“the region” to those familiar with the greater Chicago area), went to journalism school at Indiana University and was a reporter before going into PR. Realized I didn’t have the heart or stomach for journalism. I worked at a Grand Rapids PR agency founded by two former Amway Public Relations alums before leaving them to join Amway Public Relations in March 1989. I hopped over to Quixtar shortly after its launch in 1999. I’ve been married since 1992 to my college sweetheart and am Mom to two girls.

adatudes@opportunityzone.com