XELR8 Discontinues MLM Business Model

by Adrian Armstrong on January 21, 2010

This kind of decision by a company damages the industry as a whole and doesn’t even give the reasons why the board of directors have pursued this course of action. My heart goes out to all the XELR8 associates who have had their hard work and dreams stolen through this action. Perhaps some of the 12 Critical Success Factors were missing, I don’t know, but it’s a hard way to start the decade.

[XELR8 LETTERHEAD]

January 19, 2010

To: XELR8 Independent Distributors

Re: XELR8 Multilevel Marketing Program

After careful consideration, the Board of Directors of XELR8 has determined to pursue an alternative business model resulting in the discontinuation of our XELR8 Multilevel Marketing Program in its current form, and has asked me to inform all XELR8 Independent Distributors of this decision. As a result, the current XELR8 Compensation Plan will be terminated effective February 28, 2010, and you will be offered the ability to participate in a program to be announced on a national call on February 3, 2010. At that time you will be offered an attractive incentive for you to continue to enjoy XELR8 products as well as compensation for existing and new customers that you introduce to Bazi.

Although the current XELR8 Compensation Plan remains in effect until February 28, 2010, please be advised that no new Distributors may be enrolled as of the date of this letter. While you will no longer be able to enroll new Distributors, you, and your customers (both existing and new customers) may continue to order XELR8 products. Commission and bonus payments earned prior to the date of this letter will be paid according to the current XELR8 Compensation Plan. Commission and bonus payments earned after the date of this letter through February 28, 2010 will be paid on or about March 15, 2010. Following the payment of these commissions and bonuses, no further bonuses or commissions will be paid to any XELR8 Independent Distributor under the current XELR8 Compensation Plan.

Although the Company has elected to terminate the current multilevel marketing program, XELR8 products will continue to be available through Independent Distributors through February 28, 2010, and other direct marketing channels to be announced on our national call on February 3, 2010. If you are enrolled in our AutoShip program, you will continue receiving your monthly AutoShip order until such time as you elect to cancel your participation in the AutoShip program. Preferred Customers will also continue to receive their automatic monthly orders until such time as they choose to cancel their Preferred Customer Agreements. If you wish to cancel your monthly AutoShip order, please send your notice of cancellation to us at 480 South Holly Street, Denver, Colorado 80246. Alternatively, you may fax or email your notice of cancellation to us at (303) 316-8078 or support@xelr8.com. Please include your Distributor ID Number in your notice of cancellation.

As mentioned above, XELR8 intends to continue distribution of our products through Internet sales and other direct marketing channels. As our thanks to you for your support over the past several years, you will be offered the ability to enroll new customers after February 28, 2010 and receive compensation under a new compensation plan at a preferential compensation payout to be announced on February 3, 2010. If you are not on our AutoShip program, you may still enroll as a customer under our AutoShip program by contacting our Customer Service Department at 888-935-7808 or email support@xelr8.com.

In closing, I want to thank ALL of our Independent Distributors for their support of XELR8. While the decision to terminate our multilevel marketing program was not a decision that any of us at the Company wanted to make, ultimately it was deemed necessary to insure that our products remain available to support the health and vitality of our customers. We are extremely grateful for your efforts to spread the word about XELR8 products and wish you success in your future endeavors.

Best regards,

XELR8 HOLDINGS, INC.

By /s/ Sanford D. Greenberg

Sandford D. Greenberg

Chairman and Founder

Make sure you read Lou’s book, so you know what to look for in a new company.

All the best for your success,

Adrian Armstrong
http://www.betternetwerker.com

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{ 4 comments… read them below or add one }

Maggie Kress January 26, 2010 at 11:35 pm Thumb up 0 Thumb down 0

Perfect example: MANAGEMENT DRIVES THE BEHAVIOR IN THE FIELD. This means the upper management is in control. I am sure there were some missed red flags in their Compensation Plans or Terms and Conditions. They are more concerned about their share holders than their reps that built them the company they are today.

I find it very sad that a company turns it back on the very people that truly built the company. If the upper management did not have the distributors, there would be no company. Companies like this do not see it that way.

There are some reliable companies that you can still build with that will appreciate what you do.

Do not give your future away because of this. You deserve the very best and this company does not recognize that in their self centered thinking.

God Bless
Maggie Kress
maggiekress.com

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Andrew Fenwick January 25, 2010 at 10:28 pm Thumb up 0 Thumb down 0

I think some of the advice in Lou’s book about the industry ring true here. You need to choose a strong company who has owners that are committed to the distributor / IBO force and their success.

These guys have put themselves and personal profit before the success of those they have promised a future to.

I agree, become a brand of your own, offer more value to your group and they will support your brand and what ever that ends up standing for.

Cheers

Andrew
Sunrider IBO Australia

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Peter Arnold January 25, 2010 at 10:06 am Thumb up 0 Thumb down 0

Hi Lou:

YES – this is indeed another “blacjk eye” for our industry.

As I’ve posted elsewhere about this – my heart ‘aches’ for those Reps / Distributors / Affiliates who may have ‘poured their hearts, souls and finances’ into building a business with this company – only to see it “evaporate” before their eyes.

Personally, I continue to believe in (and recommend strongly to others!) => to position ourselves through SELF BRANDING for “multiple income streams ((not necessarily “multiple M/L/Ms)) — so that we protect against “wraping ourselves [and our identities] around any ONE MLM – Affiliate – Direct Sales company.

It’s just good planning in my view.

EDUCATION – Y/our DRA (Distributor Rights Association) needs to “keep educating” people – not only to the RISKS in this industry – but also to the wonderful REWARDS, when “solid” companies are partnering with us..

Your “MLM-The Whole Truth” does an outstanding service for our industry, Lou – many thanks!

Warmly / Peter A.

Peter Arnold, CLU, CFC / Founder
Business Achievers Academy / Canada

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David W Johnson January 25, 2010 at 10:05 am Thumb up 0 Thumb down 0

Looks like XER8 just signed their own death warrant! I predict their March sales will drop more than 70%.

Many thoughts are running through my head and one option that seems appealing to me is for the existing associates to boycott XER8 and instruct their retail customers to do the same.

Hopefully this would send a message to other MLM companies that if you try to do the same, your associates will collapse your company entirely.

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