About 18 months ago, MLM company, Bazi (formerly XELR8) left their MLM distributors and chose to take their product direct to consumer.
Here is a quote from my article on the day they fired their MLM reps:
In my opinion, Bazi has a slim chance of survival without the personal stories and face to face sales that Network Marketing is famous for. Good news is the company is public and traded on the OTC…we can easily report the results of this fiasco as it unfolds.
So I took a look at the sales results and it looks like Bazi is now in some serious trouble:
The company did $6.2 million in 2009 (last full year with the MLM model) and only did $2.27 million in 2010 when the MLM component was removed.
And if you think that’s bad, they are on pace to do about $1.2 million in 2011.
Ouch. I wonder if the investors and board are happy with the stock at 12 cents per share?
Without knowing all the details I might point out that the numbers could be deceptive.
***The company did $6.2 million in 2009 (last full year with the MLM model)
How much of that $6.2 was paid out in commission and expenses?
***only did $2.27 million in 2010 when the MLM component was removed.
How much of that $2.27 was paid out in expenses?
If the NET income is NOW greater due to lower expenses then the company could actually be MORE profitable now with a lower income than it was with the higher volume.
…and they are on pace to do $1.2 million this year without the MLM Model.
Bazi is actually a good product, the only problem with their mlm model was the management. They wasted over 20 million dollars, now their going the retail route and their annual loss is actually more than when they were mlm. Can’t blame this mess on the distributors now.
Wow, I never heard of Bazi MLM before. I guest they should of used the 2 up MLM model. They would of had a better chance at being successful for their mlm members to make a lot of money.
Great post, thanks for sharing your thoughts
I guess some business don’t stand a chance without network marketing. SMH