Here is the final notice I sent to my downline members:
Hello All,
This is Kevin Mallory and I wanted to drop you a
quick email to inform you of my termination from
Xango. I presume John Shull or the company may
have already made this notification but just in
case I thought I'd send out this notice.
First and foremost, thank you for partnering with
me and enjoying or perhaps discovering mangosteen
juice with me. I will still remain a customer for
life because I love what is has done for me as a
product - and I believe it to be helpful in my
overall health.
For those of you who are still active customers
and/or distributors - your main point of contact
from here on out will be John Shull. Furthermore,
for those of you whom I personally sponsored -
John will become (or has become) your sponsor.
Here is his contact information:
================================
John Shull
Not provided for this blog post
================================
John and I remain great friends through this tran-
sition and he is an honorable person with great
integrity...someone you can really rely on as an
upline sponsor. If you are wanting to build your
business, pick up the phone an re-connect with
John. He is always willing and ready to help
if you want to make an effort to be helped.
Okay...now the "story" and I'll try to make is as
short as possible although there is plenty to say.
Xango dinged me on a third violation recently but
there is some history so here it is...
"DING" No. 1 - no selling on ebay!!!
The first violation came within my first year with
Xango whereas I tried to move a case of Xango on
ebay. My wife doesn't drink Xango and I do not con-
sume 4 bottles per month so we were trying to not
only reduce inventory but also market it. Ebay is
a major no-no for Xango distributors and they had
recently terminated another one of John's distri-
butors for doing this. Most people agree that once
you buy the product you should be able to do with
it what you want but Xango sees it differently &
strictly enforces this rule to protect other Xango
distributors retail pricing. This is a valid rule
but the reality is that there isn't much of a re-
tail market for Xango. Some will want to debate
this and for anyone who wants to...I'll just tell
them right up front that let's just agree to dis-
agree on it because nothing you tell me will con-
vince me that retail has might when it comes to
this product. Not at the price Xango distributors
are permitted to sell it at. Most that retail it
basically do it at a loss in order to maintain
their organizations.
"DING" No. 2 - no more personal web pages...
The second violation came as the result of the
many custom web pages I had out on the Internet
promoting Xango. I didn't violate anything as
far as making income or health claims and I was
part of a huge operation to eliminate personalized
web sites throughout. To have your own site, they
now charge thousands of dollars to review it and
it has to go through vigorous compliance reviews.
This halted many personal Xango websites. This
also was a couple of years ago. No big deal here,
I was spending to much time messing around with
web pages instead of spending more time on the
phone sponsoring new distributors. The My Mango-
steen, MyXango and Discover Mangosteen sites to
name a few are plenty adequate to build a business
if you work at it.
"DING" No. 3 -
the straw that broke the camels back...
Recently I found another company that offered a
product that I feel is excellent and, is very
affordable. This new company and product "fit
in" with what I felt was a fantastic strategy
because often, the biggest objection to Xango is
it's price. I mean, if it comes down to repairing
the car or spending $100.00 + $20.00 shipping on
a case of exotic juice or getting the car back up
and running - the juice is history! And, most
people "looking to make money" on the Internet
are looking for a very important reason - they
don't have any (money that is)! I liked the idea
of having something to offer people who didn't
want to fork out the $120.00 a month for a case
of juice. And, they'd be ordering just enough for
their own consumption so it all made sense to me.
The company is called GBG and the product is just
$19.95 for a 1 month supply. Shipping is $9.00 to
$10.00 dollars so your product still rounds out to
about a $1.00 a day or less.
So here was my strategy...continue to prospect for
new Xango business but when price became the main
objection - offer a "starter" program like GBG.
Sounds reasonable huh?
Now...my sponsoring with Xango was WAY down as
is most everyone else and I'm not the only one
that was experiencing serious attrition and
difficulty finding new customers and distributors
so I was really excited to be sponsoring so many
into GBG. It is fun again and I'm averaging 5 new
people in GBG per month.
Now...I have been marketing a free network market-
ing training CD for years with a company called
Leaders Club.
http://www.leadersclub.com/25713/uicd/
I have built up a list of network marketers from
just about all major network marketing companies
including other Xango distributors. I have coached
many of them.
So...I decided to share this strategy of having a
more affordable alternative with prospects when
promoting Xango with these other Xango distri-
butors. Now, I didn't use Xango provided infor-
mation to find other Xango distributors...this is
my own list. I was offering this as a business
building strategy...in addition to building Xango.
Anyway, one or more of those Xango distributors
reported me to compliance and the end was near.
There are always self-appointed "secret police" in
every network marketing company. These people are
rarely in profit but they know those darn rules!!!
Xango threatened termination but gave me one last
chance to remain with the company based upon the
following...
1. Quit GBG (No way! I'm having fun and growing)
2. Reveal my list of Xango distributors that I
contacted (Nope! This is
my list not theirs)
3. Fine of 1/2 uni-level commissions. Nope...I
don't believe in
"fines" when I'm a supposed
“independent”
distributor.
I had 10 days to decide and I never responded. I
was going to quit on my own immediately but it was
suggested by my up line leaders to just let things
go their own course as it would make the changes
easier on them so I just did that. I never respond-
ed and hence...termination.
So that's it in a nutshell. I have no hard feelings
and based upon the rules and procedures, Xango had
every right to pursue the termination. I can live
with the result. Things are actually better now.
John is enjoying new found life with Xango as well
no longer spending time with a dying distributor
(me) with all this great potential but never quite
realizing my full potential. You see, I'd been
having a problem with my "belief" system for some
time but was unable to come to grips with it. You
know what I'm talking about..."if I believe in it,
I can sell it". When the momentum had shifted (now
about 2 years ago)...it stopped being fun. It be-
came so hard to sponsor people knowing that most
would get in...try it for a few months and then get
out never having made any money. That is hard to
keep presenting to people when you know the truth.
Now...a reality check and something about network
marketing that most people IN network marketing
will not like revealed. But it's very factual and
why 97% of network marketers fail...they never make
any money!!! They (the network marketers) do not
consistently take the actions that are required to
succeed nor do they seek out the training in order
to turn things around. Most do not want to take the
risk or really invest the money that is required to
promote to really make it all fly. It's a business
ruled by effective marketers amongst seas of people
that know little or nothing about M.A.R.K.E.T.I.N.G.
Imagine little league baseball players going up
against NFL football players in a football game.
It's not going be productive for the baseball kids.
Many feelings are going to be hurt.
I had a downline of about 265 in Xango at the time
of my termination. I'd never made a profit because
I spent hundreds and hundreds of dollars per month
on leads, systems, tools, gadgets, google ad words,
you name it. I spent $500.00 to $1000.00 (or more)
per month trying to build the business while my
average check was around $400.00 per month. My last
check was $233.00. I just sent a box full of DVD’s,
brochures, papers, flyers...all kinds of stuff that
I'd never used to John Shull. I guess that is what
prompted this letter...my last business activity
with Xango after clearing my office of all that
Xango stuff that was collecting dust.
Ya, do that math...well over $20,000 dollars in
losses BUT - the tax write offs saved my bacon every
year so I continued to justify it all. Kind of makes
me want to say "thank you" to Xango for whacking
me like Tony Soprano.
Out of that entire downline of 265...I'm 99%
confident that the only person that was in profit
was a gentleman that I sponsored very early on and
was directly below me. I built most of the business
(with John's help) straight downline from him. He
just ordered a case per month...got a check for
slightly more than his cost - enjoying the volume
that was built below him. This is the only person
that I think ever profited in my downline. I'm not
entirely sure he always profited if he was buying
a case here and there to fund a downline member or
two himself to stay 1K. But most likely I believe
he was...but, he's the only one out of 265 that
was in profit. That would be slightly less than 4
tenths of 1% of my downline in profit. If you want
the actual number -
0.0037735849056603773584905660377358 %
Looks like a large number doesn't it?
Not very pretty is it? When I hesitated almost 4
years ago when I was first introduced to Xango I
protested..."the average person will sponsor 1 to
2 people EVER...yet, they need 14 people in Xango
to break even or get their product f.r.e.e." I went
on to say "This is to many sales for the average
person and attrition will be a problem." What changed
my mind? The allure of the dynamic compression which
indeed is a fantastic feature...for leaders with
large downlines. And I knew I was going to be one of
the ones with a very large downline. Dynamic com-
pression can really change everything but only if you
have a large organization. Here's the math with Xango
i.e. a little break even analysis.
Your cost - $120.00/month including shipping
Level I - 1 person $5.00
Level II - 1 person $5.00
Level III - 12 people $120.00
14 people to break even when you add in the annual
fee to remain a distributor and check fees.
This is without buying any marketing materials,
leads, etc. etc. etc. No marketing budget.
In other words...I have to have $1680.00 dollars
in monthly sales to break even.
Just for this discussion, let's compare with GBG
where you get $5.00 per month for each person you
enroll even though the product is only $19.95
Number of people to break even? 7 including check
fees...in fact, you're in profit with 7 if you
have no marketing budget to be consistent with the
above Xango example. There are no annual fees or
fees to start.
7 versus 14 and $208.88 in monthly sales versus
$1680.00 in sales. What sounds easier? GBG is the
much easier sell. Don't get me wrong...GBG has its
own challenges because they are running with much
less overhead and resources. If Xango and GBG were
cars...Xango would be a Mercedes or a Bentley and
GBG is a Kia or Yugo. But you know what? The Kia
dealers must be making money or they wouldn't be
in existence now would they? There's a place and
room for Mercede's and Kia's don’t you agree?
A pay plan that requires so much effort in order
to "break even" is fatally flawed and why Xango
is losing people at incredible rates (or at least
I'm told that by some insiders). I could be wrong
but I don't think so...I have some very reliable and
credible sources and I’m hearing from more than
one angle.
I would love to see Xango go to some modified pay
plan whereas they pay a larger percentage on level
one...say 20% to 30% and then spread reduced per-
centages deeper down but still adding up to 50%.
This would require fewer personally enrolled people
in order to break even and I believe it would also
slightly reduce attrition. Maybe not and who am I
to say at this point. It’s all history.
Okay...so let's wrap it all up.
Xango remains one of the best network marketing
companies out there and like I said, I really like
the product. But network marketing is one tough
business. Only the very strong survive and very
few ever make enough to replace the income they
earn from their normal jobs. So think about that
when you think about network marketing now and in
the future. A 3% chance to slightly profit. A
fraction of a fraction of 1% to earn a significant
income. Most people are to timid to like those
odds and prefer the safer less risky route.
So am I done with network marketing? No way! I've
learned way to much along the way to quit and with
each day I draw closer to becoming one of those 3
per centers and just maybe one of those fractions
of a fraction of 1% people. The odds are tipping
in my favor and I have a lot of experience now. In
spite of all it's flaws...I love the industry and
it is the ultimate "pay for performance" business.
Zero times zero = 0 You get out of it what you put
into it which includes training, time, money and
working at it and taking real business actions not
just keeping busy.
If you want to keep in touch, I'd love to hear
from you. If you want to know what companies I'm
involved with...just go to www.KevinMallory.com
I am experiencing upward growth in every one of
these companies. But I work hard at it and I have
come to know a thing or two about marketing,
generating my own leads and so forth. I can teach
most people how to do many of these things if you
are ready and willing to engage and do the work
and to learn.
Thanks again for experiencing Xango with me and
I wish you all a very Happy Holiday Season and
success in whatever you choose to do.
Kevin Mallory
Contact information at main site!
http://www.KevinMallory.com
"Nothing is impossible to the willing
heart." - The Proverbs of John Heywood (1546)
