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Quixtar



         


Quixtar is a multi-level marketing company, founded in 1999 by the owners of Amway . It employs a compensation system similar to Amway's and is the North American marketing venture for products formerly marketed as Amway products in North America. Quixtar is owned by Alticor which also owns Amway. Between 1999 and 2001, Quixtar took over the North-American business of Amway.

People can join as "Clients", "Members" or "Independent Business Owners " (IBOs). IBOs, pay a registration fee, and begin building their businesses through retail sales (to clients and members) and helping new business owners build businesses. Their earnings are based on their sales and the volume of sales and purchases of other IBOs recruited below them. The only way to join and buy products at Quixtar's web site is with a referral number from an IBO. Quixtar sales reached $518 million in the first year, with $143 million in profits being paid out to distributors.

Quixtar, and its predecessor, Amway, have been controversial for years because of allegations that these companies are pyramid schemes. Quixtar offers a wide range of products for its IBOs to purchase and sell as well as many products manufactured and marketed by third parties. Quixtar IBOs, members and clients can also access the Internet sites of Quixtar's many "partner stores" through the Quixtar website. Critics claim, however, that most of the products sold by Quixtar are to the IBOs themselves for their own use and consumption rather than to retail consumers who aren't enrolled as IBOs. As a result, according to the critics, Quixtar IBOs often spend more money than they make and can only offset those losses by recruiting a number of downline IBOs also losing money spending more on Quixtar products and motivational and training materials than they make from Quixtar. In a 1979 ruling, the Federal Trade Commission determined that Amway was not an illegal pyramid scheme because it enforced rules requiring distributors to sell to at least 10 retail customers per month and to sell 70% of the products to retail customers. Critics state that Quixtar does not enforce the retail sales rules. Quixtar maintains that the 70% rule is only meant to prevent product stockpiling to achieve certain bonuses.

There is also a great deal of controversy surrounding the Amway/Quixtar Motivational Organizations (AMOs or AQMOs) owned and operated by older/higher level distributors. Critics describe this as the "business within the business" of selling motivational audiotapes, CDs, books, videos, website access, rallies, seminars, meetings and other promotional items to newer participants, from which the high level distributors make the majority of their income.

On college campuses in particular, Quixtar representatives have recruited many students to become customers and IBOs.

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