The following Q&A was done with Boyle Network CoFounder, Jeff Boyle and SEBO America President, John Van Leuven in June, 2010.
- 1. Please provide a brief company history and describe your product offering.
- SEBO is the world’s leading manufacturer of high-quality vacuum cleaners, and it was founded in Velbert, Germany in 1978. Since then, SEBO has sold more than four million units to markets in Europe, Asia, Africa and North America. In fact, SEBO vacuums are found in the top hotels, hospitals, universities and government institutions worldwide… even The White House and Buckingham Palace! SEBO vacuums have received awards and recognition from Better Homes and Gardens, Consumer’s Digest, TIME, Real Simple, Wired Test and other magazines. SEBO also sells a hard-floor polishing machine and a carpet and upholstery cleaning system called “duo-P.”
- 2. SEBO is an internationally recognized brand that has been selling vacuum related products via traditional retail channels for many years. What inspired you as SEBO America’s CEO to move towards network marketing and direct selling for your products?
- Floor care is a $4 billion per year industry, so it’s extremely competitive and is dominated by well-known brand names. Many of the dominant players have brand names that have been well established for decades. Therefore, I never underestimated the difficulty involved in establishing the SEBO brand in the USA. Our choices were to go the traditional route and spend millions of dollars on advertising, or we could pay the big-box retailers huge fees to put our premium products next to inferior vacuums with established brand names. After looking at these options and watching the poor economy cause the rapid decline of our existing specialty retailer network, I decided that network marketing was a good fit for our premium products. I was further convinced this was the direction to go because SEBO vacuum owners are almost universally satisfied with their machines . . . so much so that they typically cannot stop talking about them. In short, word of mouth advertising is a major reason for our success, so network marketing is an obvious fit.
- 3. Will any other SEBO markets move toward a network marketing/direct sales model?
- An international strategy has been discussed, but a decision on this will wait until we see the extent to which SEBO America succeeds with its network marketing strategy.
- 4. SEBO America has many retail centers that sell your products, how will they be affected by emphasizing network marketing to sell your products?
- The cooperative relationship between our traditional retailer network and our emerging group of network marketing distributors is perhaps the most amazing part of SEBO’s new distribution strategy. Its success rests upon a well designed pricing policy and clear cut financial interdependencies between the two distribution channels. Simply put: Individuals in both groups should easily come to the conclusion that they can increase their sales by working following the strategy as team members, rather than viewing each other as competitive threats. For example, retailers can still sell SEBO vacuums the way they always have, but they can also develop their own network marketing sales teams, thereby increasing their overall profits. On the other hand, network marketing distributors benefit from their local SEBO retailers by having locally available inventory, product displays and sales training.
- 5. Have you had any negative feedback from your retail centers about your new business model? Please describe their reaction to your new business model.
- Yes, we’ve had some negative reaction. However, overwhelmingly, the reactions from our retail centers have been positive. In fact, our best retailers have embraced our new business model, and they are thrilled to be a part of it. The reason for this is the poor economy. Our best retailers believe that profound changes will occur in the retail environment over the next few years, so they want to be open minded to new ideas and new ways to connect with potential customers. Apparently, they see SEBO’s new business model as being viable and potentially successful, so they want to be in on the ground floor.
- 6. Many network marketing products would have difficulty selling via retail channels and are sold primarily due to the income opportunity behind them. Explain how adding distributor commissions will or will not affect Sebo’s product viability to those not interested in the income opportunity.
- This is a difficult question to gauge at this early stage. My guess is that five years ago this may have been a problem for SEBO, while trying to establish itself in network marketing. However, as the old saying goes, timing is everything. We all know the economy is poor. We also know that all households need a vacuum cleaner. Therefore, SEBO’s products are a “need” not a “want.” Also, SEBO’s prices are quite reasonable, and its products have an obvious value proposition. When all these facts are added together, I believe that many entrepreneurial minded individuals will feel passionate about establishing SEBO Distributorships in their communities. They will see this venture as an excellent business opportunity, which requires a relatively small amount of money to get started. In other words, people who decide to sell SEBO’s will be passionate about the product first and its excellent income potential will be a secondary consideration.
- 7. Network marketing and direct sales success rely heavily upon a stable corporate team and field leaders dedicated to the product and opportunity. What will set SEBO’s corporate team and field leaders apart from other companies?
- With respect to dedication to the product and opportunity, SEBO’s field leaders and corporate team will not be much different from other network marketing companies. Perhaps the difference may be that SEBO, as an engineering-driven company, has developed a corporate team that is methodical, customer-driven and is keenly focused on sustainable, well-managed growth.
- 8. Does SEBO have any corporate leaders that have had success in network marketing and if so, how will that person transition SEBO into success with network marketing from a traditional retail model?
- SEBO’s transition into network marketing is being heavily influenced and guided by numerous experts in the field of network marketing, all of whom have decades of experience. In fact, everything SEBO has done up to this point has been influenced by these experts. SEBO will continue relying on their input to help us build an experienced group of corporate leaders over time.
- 9. A fair compensation plan is vital to attract successful network marketers. Please briefly describe the main goal behind your compensation plan and if it is tailored toward quick initial commissions and stable long-term commissions for those planning to make a career with SEBO.
- SEBO’s compensation plan is evenly balanced between quick and substantial retail commissions and generous multi-level bonuses. Therefore, this plan should be attractive to people interested in a career because it provides a balance between immediate income and the potential to build long-term residual income.
- 10. Financial backing can make or break a new company. SEBO has been operating for many years worldwide, how does that provide benefit to your network marketing opportunity?
- Indeed, SEBO has been operating worldwide for many years, and, as a result, it is a financially stable company. Therefore, SEBO began developing its network marketing program with ample funding to get the job done correctly. This is why SEBO hired the best network marketing consultants available. As I said earlier, SEBO’s corporate leaders are methodical and try hard to avoid unproven strategies that may undermine our financial health and long-term stability. Thus, SEBO’s financial wherewithal and managerial experience led to the development of a new network marketing program that should provide long-term potential to individuals interested in securing a desirable network marketing opportunity.
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