The History of DS-MAX
Murray and the First Idea
In 1980, in Toronto, Canada, a man by the name of Murray Reinhart worked in direct sales.� The company for which he worked went under.� Murray was in his mid-twenties, $30,000 in debt, living out of the back of his car, and creditors had his home number on speed dial.� His mother was receiving all of the harassing phone calls and cried to Murray, asking him why he was so in debt.� Murray decided to be proactive after the company went under and decided to start his own.� His company, however, would not be based on sales, but opportunity.� It wouldn't be based on a person's ability to sell, but a person's ability to work the Law of Averages and have a great attitude.
Larry and Avie join Murray
Murray Reinhart recruited two men, Larry Tannenbaum, and Avie Roth.� Murray's main idea was that any person, regardless of race, creed, gender, could make money selling products door-to-door as long as that person saw as many people as possible, was indifferent towards negatives, and had a great attitude.� Larry and Avie agreed.�
Murray, Larry, Avie, and the first office
Murray, Larry, and Avie bought pots and pans and sold them at a marked up rate.� People bought.� Customers didn't care about whether or not they could buy the same pots and pans down the street for less, they cared about how excited these guys were.� Attitude sold, not the product.� Eventually, they were able to afford a suite in an industrial park.� Murray's first desk was comprised of standard, plastic crates.� Now Murray started putting ads in the paper.
Murray builds his organization and the organization grows
Murray, Larry, and Avie would train five people at a time, five in the morning and five at night.� Eventually, these new people started working on their own.� Murray built his first office.� As revenue increased, so did buying power.� The more money you have, the more products you could buy at a reduced rate.� Overhead shrank and buying power grew.� The Clearance division was born.
Promotions and further growth
Originally, the company was called WWI (Wholesale Warehouse Industries).� The name was changed to DS-Max (Direct Sales to the Max).� Murray started promoting offices and the direct sales force became more efficient and productive.� People with good attitudes who worked the Law of Averages made it so that WWI could eventually produce, rather than purchase and resell.�
The Clearance Division
Different divisions were born out of Clearance.� The Roses division offers a dozen roses for twelve dollars.� Today, DS-Max owns rose fields in Colombia.� Every morning, the leaders of the office pick up the roses from the airport, cut them, package them, and bring them back to the office.� Ashten Racks is another division.� Distributors pitch business owners and leave racks of products in their locations.� Both the owner of the business and the distributor make commission on the products sold. DS-Max's Clearance division was the first, the division upon which the company was built.� It is the backbone of DS-Max.
Murray's first idea
Murray, Larry, and Avie proved attitude can build a company.� DS-Max had pushed products, bought patents and rose fields, and proved that anyone with a good attitude can move any product.� "Sell the sizzle, not the steak."� The attitude of a distributor is what sells, not the product.
The Second Idea
Then, the idea of representing a client, instead of pushing DS-Max's own products, created the Advertising Division in 1990.� Until then, distributors sold products made by DS-Max.� The Advertising Division started out representing small businesses.� Listers (Employees of DS-Max who seek out clients) would approach small businesses that were just starting out and businesses that have experienced a loss of revenue and propose to them a campaign.� For example, if PMI Pizza was struggling through the first year of business in Duarte, CA, the lister would propose a buy one, get one free certificate.� The Advertising Division sells the coupon, keeps the profit, and PMI Pizza's clientele base grows.� Over time, DS-Max's Advertising Division's clients became more and more prestigious.� The turning point for the Advertising Division was the N.Y. Yankees campaign.
The Yankees and the Advertising Division
In the early nineties, while the Yankees were struggling almost as much as their ticket sales, DS-Max?s listers approached George Steinbrenner.� Much like the PMI Pizza example, the certificate offered a buy one get one free ticket to a Yankee game.� Steinbrenner agreed and, within one baseball season, in 162 games, the Advertising Division put 150,000 people in the seats.� DS-Max started to get recognized.� Skytel Pagers was another early campaign.� At one point, Skytel Pagers were only available through SkyMall, a magazine only available on airplanes.� Another certificate was made up for a buy one, get one free deal and pushed.� Skytel's clientele base the year before Advertising took on the campaign was 300 customers.� In one year with the campaign, Advertising added over 100,000 customers.� The Advertising Division has worked for The Philadelphia 76ers, The Bicycle Club, Papa John's, Pizza Hut, Jiffy Lube, and countless others.� Advertising became the fastest growing division of DS-Max.� Then, Murray, Larry, and Avie had another idea.
The Third Idea, The Retirement of Murray Reinhart, and the Origin of Cydcor
��������������� DS-Max had always dealt with the exchange of goods for money.� The third idea was to start pushing services.� Instead of asking for cash or a check, distributors would ask for a signature.� In 1992, The Communications Division was born.� After Murray retired, Larry Tannenbaum took over as Executive Vice President of DS-Max.� Now that services were involved, Avie Roth would run the Communications Division as Executive Vice President of Cydcor (Avie's daughters are name Cydney and Cortney - Cydcor).� Jim Majeski, former MCI C.E.O., came on as the main lister for Cydcor, and, AT&T- just after the deregulation of phone companies in the nineties - became the first client, signing a four and a half year contract.
The AT&T Campaign and It's Effects
��������������� Much like every other client, AT&T underestimated the efficacy of direct sales.� The "paper-pushers" of Cydcor set up accounts with business owners.� In order to confirm the orders, distributors had to call a third party verification center which forwarded the orders to AT&T.� The system AT&T prepared for the orders was hardly ready for the volume.� If an application was not matched with the verification call within two weeks of the call, the application was null and void.� Distributors flooded AT&T with applications and not all the orders were completed on AT&T's end.� AT&T organized an entire division to handle Cydcor's applications.� Today, the Cydcor is responsible for over 41% of AT&T's overall clientele.� The Communications Division became the fastest growing division of DS-Max.� DS-Max as a whole now only deals with our own products and those products and services of Fortune 500 companies.� The AT&T Campaign gave DS-Max and Cydcor the recognition it deserved.
Murray Returns and Cydcor Grows
��������������� As the company he built was growing, Murray was getting bored.� He missed the thrill of the field and the support structure of the office.� Murray decided to come back into DS-Max by way of Cydcor.� The founder of a company that banked over two billion dollars in revenue in 2000 went back into the field to build his team.� He formed a partnership with Dave Zinke and opened a deal in Norwalk, CA, named DotCom Marketing Inc.� Out of their office in Norwalk, Murray and Dave became the hub owners of what will soon be a division within Cydcor, the Travel Division.� Jacquelyn Nguyen, promoted by Murray and Dave, runs the Travel Division.
DS-Max and Cydcor
��������������� DS-Max is currently the 6th strongest direct sales force in the world.� We are on pace to be #1 by 2005 as 3,500 offices are waiting to open up by the end of Summer 2001.� With the Travel division booming and Cydcor getting more clients every day,
DS-Max and Cydcor's listers are the only people busier than the distributors.� Murray has said that his company offers "the greatest opportunity in the world."� With twenty years, over 10,000 offices worldwide, and $2,000,000,000 in revenue in the year 2000, under his belt, he's probably right.
Miscellaneous Information
Other Divisions, Campaigns, and Products
��������������� The Books division has contracts with Disney, Hanna-Barbera, Warner Bros.,and several other corporations.� Before Disney movies are in wide release, Murray, Larry, and Avie are asked to see the film first, then delegate the writing of the books - in approximately 50 languages.� Since DS-Max has the contracts, no other direct sales force is allowed to push these books. Clearance is responsible for the popularity of such products and "Big Mouth Billy Bass," the fish that sings if a person walks by it, as well as the "Razor Scooter."� Cydcor is now working with ACC Business, Card Services International (CSI), Dish Network, Charities, etc.�
The Reliability of the Clients and the Campaigns
The first idea that launched the company was attitude.� A great attitude coupled with the Law of Averages will move any viable product.� DS-Max always test markets campaigns for at least a year before any considerable amount of offices take it on.� Ordinary people who have great attitudes and work the Law of Averages are asked to push products in order to give DS-Max an idea of how the campaign will work.� At one point, there was a Clothing campaign.� Distributors would wear the merchandise and attempt to ring the bell.� They didn't, DS-Max didn't take on the campaign.� Another failed campaign was Pizza.� Just like the Clothing campaign, the Pizza campaign didn't get passed the test market.� Before DS-Max offices are given their consignments, the consignments have been test marketed thoroughly and the strokes adjusted so that every distributor can ring the bell every day.
Direct Sales v. TV Commercials (Communications)
��������������� DS-Max now has over 10,000 offices in approximately 100 different countries.� Consider the making of a commercial.� Allow one million dollars as the cost of production and another million as the cost of airtime.� Without making a cent in profit, a company has already spent two million dollars.� Not only that, but the company still doesn?t know whether or not the commercial will result in profit.� Now consider direct sales.� Allow twenty-five people as the average number of people in any DS-Max/Cydcor office.� These twenty-five people see at least one hundred people a day.� Allow only 100 offices to take part in the campaign.� Now allow all distributors a week to work.
25 people x 100 potential customers x 100 offices x 7 days = 1,750,000 people have heard the name of the company.
Now allow that everyone rings the bell with two applications.
25 people x 100 offices x 2 applications x 7 days = 35,000 new clients each week for the company.
-$2,000,000 for x clients (T.V. Commercial) v. Paying flat-rate commission on clients earned (Direct Sales)
Yes, the commercial may reach more people in a shorter span of time, however, direct sales is a commission based job.� The company doesn't make money unless the distributors make money.� Also assume that not everyone pays attention to commercials (phone calls, getting a drink, etc.).� Direct sales may not be the corporate way to advertise and expand clientele base, but it is, in my opinion, the most economically sound.
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