Monday, July 18, 2011

Why AutoXten can NEVER work

I don't mean to pick on AutoXten particularly, and why it can never work, but it is a glaring example out there right now.

I have been around this industry for right abotu 3 years now. During that time, I have seen dozens of such programs come and go. There is a very simple reason why such programs as AutoXten can and will never work in the long term.

The comp plan is not sustainable.

What does that mean? I will tell you. The promise of the program is, make a one time investment of $10 and sit back and draw thousands of dollars. The people who get in at the very beginning can make a bit of money from it, although they will never see the kinds of checks that were shown in the over-hyped marketing campaigns. This makes it all the more difficult to explain, to someone in the program, why it will not work. They are getting a check, so they think it's working. WRONG!

The quick test is, what happens to the income when the recruiting stops? if the income stops when recruiting stops, the it is not only a bad business model, but most likely illegal. At best, they are riding in a gray area and hoping the feds do not come knocking on their door. Ongoing sale of product is the only way to keep a business, of any kind, in business. From an MLM start-up to Wal Mart, if they did not continue to generate sales, they would not last.

Then ask, why will the recruiting stop? History has shown us why. Programs like AutoXten have a HUGE hype machine going prior to and just after the launch. Most people who are going to join will do so within the first month or two. After that, growth slows to a trickle. A few newbies here and there, that do not know nay better, might get roped into this deal, but otherwise, it has gone flat at that point. So, members have a hard time recruiting, and if nobody can recruit, nobody will get paid.

This is why AutoXten and other programs like it can never work. Their entire business model is not self sustaining. Every one of these companies I have seen, over the past 3 years, has been gone within 2-3 months of launch, if they even launched at all.

I hope everyone who reads this gets this concept. This is one of the first lessons I want people to learn when they look into the Educational program I mentioned not long ago. I am still working on putting that campaign together, so keep your eyes open for it.
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