Friday, January 06, 2006

So How Much Does It Really Cost?

I know that there are some prospective IBO's that will find this blog someday, and there are probably some current IBO's that don't know how much it really costs them and finally, there are some "former" IBO's that stopped building the business because they thought the investment into building a business was to great for the return. Well, I'm just going to break it down so that we're all together on this.

First is the issue of getting started properly. To me, a proper start is registering with Quixtar (about $50,) getting the publications (about $20,) getting on CommuniKate (about $31) and placing your first order (varies.) If your team provides any type of educational starter pack (CD's, list builders, books,) I would suggest getting that also (probably between $45 and $75.) Why would you want to start behind the eight ball? The typical start-up cost, not counting placing your first order will run somewhere between $100 to $175 depending on whether there is an educational starter pack purchased or not. Look at the cost to start any other business on the planet. What would it cost to even build your own website with sales and tracking capabilities? This opportunity gives you access to create income right off the bat. I have had IBO's create the Member/Client volume in their first two weeks to reimburse themselves for the investment they made to get started plus extra. Registering with Quixtar is an annual cost and CommuniKate is monthly. I'll save why CommuniKate is so vital for another day, but it ties into the post on the system that I made earlier.

Here's the breakdown of other expected first year expenses an IBO is likely to incur depending on how their education system handles functions, etc.:
Open meetings - $5 X 52 weeks = $260
Major Functions - $100 X 4 major functions = $400
Bus Charter Contribution - $100 X 4 trips = $400
Fall Leadership - $30
Team Meetings - $10 X 4 = $40
Seminar/Rallys - $10 X 2 = $20
Various Other Events (Christmas parties, spa days, etc.) - $50
Standing Order - $7.50 X 7 = $52.50/week or $2,730/year but I'll make it an even $3,000 to account for taxes, double CD's (once a month) and the book of the month
Gas is really a subjective and I say this because unless you were a total homebody before the business, you were driving somewhere on those nights that you are now using to build the business. The driving that I used to do from bar to bar and from friends house to friends house has been traded for driving to open meetings. Not everyone has to "drive the miles" right off the bat. For arguement's sake I'll add in another $30/week in gas for a total of $1,560/year.

That total is $5,760 for the entire year. Plus your start-up cost. All of which are tax deductions in some way or another. I won't count what you order because you have to buy stuff anyway. What business do you know of that you can run on less than $6,000 per year? Not $6,000 all at once. Not one lump sum here and one lump sum there. Less than $6,000 TOTAL. That's less than $500/month. If you didn't recieve one check until you went Q12, you would still be in the black as soon as the first year of Q12 income came in as long as it happened within your first 9 years. More clearly:

Q12 total income as shown in the plan = approximately $50,500
$50,500 divided by $6,000/year = 8.4

That doesn't count the fact that you will make money along the way and because you were accountable to your upline when it came to standing order, as a platinum you are probably receiving a tool break so your income is even better. Yes, I said it. A tool break.

I guess it's time to eliminate another weak internet argument. The supply side of the franchise system is one that you can profit off of and so is the education side. Again, thinking of McDonalds, you do understand that part of your $1.25 million goes to your education, right? You understand that the people teaching you at Hamburger U. aren't there pro bono, right? All the materials you use to teach and train your staff at your McDonald's are not given to you, they have to be paid for. Well, the same is true here. "Foul" some may call (and put up sites ad nauseum to complain.) "But the IBO has no end user to market to outside of the business when it comes to CD's and tapes." That's a true statement, but I don't want to buy your college calculus book either and I don't see anyone crying foul over the $150 they drop on those things. And they make it through whole semesters without even breaking the binding.

Here's the best part though: by participating in the educational side, by being on standing order and staying accountable to your upline, when you go platinum you actually qualify to receive a break on the cost you have to pay. At this point in your business, you probably have enough people in your group that you may need to hire an assistant to separate the educational material or you are at least deserving of being compensated for your time. None of my line of sponsorship has ever charged me for their help with showing a plan for me, never sent me a bill for counseling on how to run my business and never will. The least I can do is be responsible enough to want to learn some things on my own time and attempt to create a thirst for knowledge in the business owners I'm looking to work with. I'm excited about the income I'll see from tool flow and speaking engagements when the time comes. This is free enterprise, not socialism; the qualified are asked to speak. Spots are earned but they're open to anyone who wants to put in the work. That's not fru-fru, nicey-nice talk. I've heard as much in qualified meetings that I've snuck into with big pins.

Just remember - if you want this to be a hobby, it can be a very expensive one. If you are in this thing because you really need the extra income, do more than just order the CD's and books. If you read them, you will act. If you're not successful in year one, you've got a ways to go before you've proven this "thing doesn't work."

One IBO

Comments:
Hi! Great Post!

Just wondering, when you show the plan do you also show how people make money from the movement of tools?

You seem to be pretty up front about it, so I was curious. What percentages do you show that they will receive at the different levels? ie. a certain percentage at platinum, a higher percentage at emerald...etc.

If you are showing tools profits as part of the plan, does the corporation know and approve that?

It's funny how the internet changes things. Back in the mid 90's, and prior to that, it was always stated that the "leaders" were there to help you, and that they did it out of the goodness of their hearts. They didn't need to be there speaking to you, but since they love you, they chose to do so.

Now that everyone knows how that is patently false, the tools profits are considered common knowledge. I find it really neat how they empower themselves by now deciding to tell the truth, and assuming that people will forget.

Funny how things change.
 
I don't go in depth in explaining the income that can be derived from the education side. I do mention that there is an income opportunity available there once you reach a certain point in the business. I don't show tool profits, I simply answer the question before it's asked.

I think being able to derive income from the education side is a positive. Many people can excel in various businesses but only so many are asked to teach other people how to do it. Not every investor can have the same literary success of a Robert Kiyosaki. If Kiyosaki derives the majority of his income from teaching at this point of his life, so what? He's earned the right because of what he's accomplished in the arena that he is speaking on. I have paid to see him and other people with no business vehicle for me and I'm sure they all got paid for their work. Why do I care if some of the money I paid to attend an event goes into the speakers pockets? I would hope that someday what I have to say holds enough value that people are willing to pay to hear me.

I don't know about the business in the mid-90's as I wasn't in the business then. What I do know is that it was a very different business then than it is now. Either way, I don't know of anyone or how anyone who could grow a business to the Diamond level without the aid of the education system. True, speakers get paid to speak at functions, but if they don't speak and there is no function, and therefore no CD or tape, and we cut out the open meetings because that's on the education side, then everyone just runs around and has to be the magic on their own. There is solace in knowing I am actually trying to duplicate what other people have done instead of trying to make my own way or simply rely on what one upline is telling me.

Lastly, "deciding to tell the truth, and assuming that people will forget" isn't quite accurate. I got excited when I learned about the availability of income on the education side. This was after I read numerous websites that bashed it. I haven't forgotten about it. The goal is to disarm the misinformed negativity that is portrayed by some people about that side of the business.
 
I guess if I was an IBO, the 2 main questions I would feel compelled to ask are:

1. If you are showing tools profits as part of the plan, does the corporation know and approve that?

2. If the education system is so valuable in creating successful IBO's, why are these tapes and CD's not available to download as an MP3 file to your group at a drastically reduced cost? It is in everyone's best interest to have access to them, no? So why not make it available for a cheaper cost?

I think everyone knows why. Product volume is not the moneymaker.

Tools flow is.
 
joecool, while I understand your point, the point is that "many" IBO's don't actually actively build the business. To answer your question, most businesses are in the red for a number of years before they actually turn a profit, however, this business doesn't require a large capital investment up front. I'd rather invest my money into training myself and people I sponsor over investing into buying a building or a billboard advertisement any day. Plus, with the opportunities available through marketing the products with programs like Incredible Edibles and the Gift & Incentives, it can become very easy to build your business from the black within your first few months. Not only have I seen it done, I've had IBO's in my group do this.

Will that take a little marketing of your own product? Sure, but if it provides a positive income base while you build a six-figure income, I think it's worth it.
 
rocket, as I mentioned, I do not show specific tool profits, I simply state that there is an income opportunity on the education side when you reach certain points of success.

As for point number 2, if education is so successful in creating successful people, why do colleges charge so much in tuition? Why don't they just hand down all the books from one class to the next? Because colleges are in business for two things, to educate and to make a profit.

It's minimalistic to even complain about this. Just go platinum and you have access to this income as well. If income was only available to the head of the organization and they still promoted buying instead of downloading, I could see your point, but the income is available to anyone that goes platinum and above, properly. Bill Britt has a right to make a profit from the education system but has set it up so that people that do the work can earn additional income from it as well.
 
I think what's ironic is that you gave Rocket and JoeCool18 a straight answer and they still found fault in it.

It wouldn't have mattered what you said they would have found fault in your answer.

Great job with posting real information in neutral way.
 
Thanks Kevin. I truly think rocket and joecool mean well and it seems like they didn't have the best experience with the opportunity. This business involves people and relies on people keeping standards and being trustworthy and frankly, not everyone is.

While I think this is the best business opportunity for me and many others, it's not for everyone and I think that occassionally people are thrust into leadership positions that they aren't prepared to be in. It seems that these may have been the type of people that led to some of the negative experiences had by those that decide to spend their freetime deriding a corporation that has little to do with that individual on a personal level.

I wish everyone the best in whatever they choose to do and expect the same in return without demanding it. I do believe that people who work traditional day jobs should seek something more than just counting on 401K's and pensions, be it Quixtar or something else to supplement their income.

OneIBO
 
OneIBO SAID>> I don't go in depth in explaining the income that can be derived from the education side.

WHY NOT? Why can't you "go in depth in explaining the income that can be derived from the education side"


OneIBO SAID>> I do mention that there is an income opportunity available there once you reach a certain point in the business. I don't show tool profits, I simply answer the question before it's asked.

Again, WHY NOT? Is there a specific contract guaranteeing access to the Tool Profits?

I mean, there's a specific contract on which the product-related-Quixtar-bonuses are based. So, don't you think the prospect has a right to know whether there is a specific contract for sharing of the Tools/System Profits? And if there isn't one, don't you think that's like saying, "Well, we (the System-Kingpins) do make most of our income from the "System", and we WOULD NOT HAVE THAT INCOME, IF IT WEREN'T FOR THE FACT THAT YOU GUYS ENROLLED WITH QUIXTAR TO RUN YOUR OWN "INDEPENDENT QUIXTAR BUSINESS". But, we do inform you about that. Oh, but as far as the question of WHEN YOU get to SHARE in the 'System Income', we are not going to reveal that to you right now. Oh, and as far as HOW the "System Profits" are shared, WE (I.E. THE SYSTEM KING-PINS) will decide on our whim, how you are going to share in those profits. i.e. You get into Quixtar, hoping to make money from the QUIXTAR BUSINESS, but also hoping to make MOST OF YOUR MONEY from the 'System Profits' when you get to a certain Pin Level. BUT, what pin level that is, or what kind of profit-sharing in the 'System Profits' at that point, we are not going to tell you. WE ARE JUST GOING TO DANGLE A CARROT IN FRONT OF YOU."

Correct me if I am wrong, but that's the gist of your assertion, right?
 
Choosing not to go into depth and being unable to go into depth are two different things. Tool profits are not something that is immediately available to someone looking to become a part of the business team, therefore usually not of immediate concern. Most people that I show the plan to want to know what they can do to start earning a check a.s.a.p. When they find that there is an availablity of more income, it does add excitement, but if you can't get excited over what you can get paid through Quixtar alone, then you may have some other issues.

I don't grasp this whole "kingpin" concept unless that is your generic term for anyone that receives income from BWW. My upline has never been shy about telling me when I'll receive a tool break, nor has he been shy about telling me what it can amount to. I've been informed as to how profit-sharing works. I would apologize for whomever your upline was not having this knowledge, but it wasn't my responsibility to teach you, but that's not my place.

Business owners decide on a whim as to how they will pay bonuses, set up pay structures, etc. all the time. I personally have no knowledge of changes in profit sharing being made "on a whim," but I also know when the first tool break is and approximately for how much, so I'm not sure of your point. Actually, I'm sure of your point, it's just isn't very valid today.

Regardless, for sake of your arguement, let's say that you go Emerald and get no money from the education system. None. Zero. I believe the average income for Emerald's was still around $100K. What was Diamond? Around $250K? EDC? Somewhere in the neighborhood of $750K? You can pay me tool money or not pay me tool money, $100K/yr. is enough to keep me from having to work a day job. Even if it took 30 years just to go Emerald and retire, I'd be ahead of traditional retirement age. I don't care if I get on a stage or cut a single CD, I got started so that I could dump my 9-5 for good. Anything above that is "extry."
 
Hey

Just checked back in. You may want to read Merchants Of Deception. He gives a pretty good idea as to what you can expect for an income as an emerald.

Or you could check Jeff Probant's site. He also fills you in on what emerald income amounts to.

You may be surprised.

I'm glad that you feel your answers were straight up. I think you are trying to be honest and give the straight poop.

The reality of the situation is that you don't know what the tools profits will be. What if that decides whether or not a prospect chooses to get in?

If there are any questions that can't be answered regarding the income you can make, there is a problem with the business, or the way it is being run.

Direct questions from a prospect deserves a direct and honest answer.

What happens if you hit the emerald level and don't get any tool money? At this point, you cannot even assure anyone including yourself that this is impossible.

Most people will not want to commit to a vaguely described outcome.

If you can dig what I'm saying?
 
I don't need to read "Merchants of Deception" to find out what Emeralds get paid. My upline Emerald has happily shared and proven that information to me. I'm not in confusion on what Emeralds make. Actually, let me refine that - I'm not in confusion on what Emeralds can make. Just like in any other business, being a business owner doesn't mean you make the same as every other business owner. Two guys that own hardware shops can make vastly different incomes depending on their strategies, location and workforce.

In other words, it's not surprising to me, nor should it be to anyone else, that not every Emerald is locked and loaded into financial independence. Not everyone's group shapes up the same way. If all you have is 3 platinum legs and no side volume, making six figures might be a little tough. Of course, if all you have is 3 legs, going Emerald is going to be tough. However, by participating in the education and training program that is available, people learn why getting wide is helpful and how to do so properly, therefore setting up a proper Emeraldship. My upline Emerald made over $200K last year, just from Quixtar - not counting System income, and yes I've seen the checks to prove it.

I appreciate the compliment on my honesty, so I'll continue to be honest with you - in reality I actually do understand how the tool profits work, and it hasn't come up as a question from a potential IBO yet. Like any other incentive based pay, giving someone an exact number on what they will make isn't fair to anyone. That isn't a question that is being refused an answer, it's a question which has an answer containing a number of variables.

How much money will a recording artist make in any particular year? If you can't tell an aspiring singer exactly what they'll make next year, is that a reason for them to stop singing? What about an aspiring athlete? Even an aspiring business owner doesn't know exactly what they are going to make by starting a traditional business. The flat out point is that the Quixtar income is definitely enough to make the effort worth the time. The System income is a bonus that is not mandatory or guaranteed. However, it is available. I didn't get started in business because of the System income. I got started because the Quixtar numbers were attractive enough for me. Considering 75% of Americans make less than $60K per year, the Quixtar money buy itself is probably attractive enough for a few more people as well. System income? That's an "icing on the cake" thing if you ask me. It's a reason to perform, not a reason to quit.
 
ONEIBO>> Like any other incentive based pay, giving someone an exact number on what they will make isn't fair to anyone. That isn't a question that is being refused an answer, it's a question which has an answer containing a number of variables.

You are either missing the point or you are deliberately diverting the issue. It's not a question of "what they will make". It's a question of "what they will make when they move a certain volume of tools". Don't you think that's exactly how the Quixtar Plan is presented? Consider the commonly presented 6-4-2 example. What are you doing? You are saying that if you recruit people and your structure looks like that, you will receive so and so income, right? If you just presented the plan as - Platinum makes so much, Emerald makes so much, Diamond makes so much, EDC makes so much.... do you think a prospect would be convinced?

You get my drift?
 
I'm not diverting the issue at all. For what I believe is the third time I will say that I am well aware what income is available for moving a certain volume of tools.

When people see the plan, the interest is in how quickly they can begin creating income. The available income from Quixtar is quite sufficient and income from the education system is a bonus benefit. To me (meaning: in my honest, but accurate opinion,) if buying CD's, tapes, attending meetings, functions etc., is a proven aid in going Silver, Platinum, Ruby and so on to Diamond, it is well worth the investment. If you make $150K as a Diamond bare minimum, it is worth spending $5K or even $10K on tools every year, even if the education system never pays you.
 
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