a classic case of down'n'dirty frontloading

Let's get right down to brass tacks and talk specifically about Summit Photographix and Amerapress, shall we? 

Summit Photographix closed its doors and ran away with our money, and the FTC took them to trial. 

What about Amerapress?

Well, when I first wrote this article a year ago, I was torn.  Could I actually be WRONG about Amerapress?  Lots of Believers said I was.  (Okay, so they hadn't seen the money yet, but it's not unusual for reality to take hold slowly.)  So I covered my tracks with this disclaimer: "I am not saying for one minute that Amerapress is in the same category as The Scummit, but I am comparing the two PRODUCTS and the two PROGRAMS because they are very similar.  As I understand it, Amerapress was investigated by the FTC and allowed to continue their operations, so I am not implying any dishonesty by making this comparison.  As far as I know, they were cleared of any wrongdoing."  (Or so the story went.)

But I didn't like it.  I didn't like it one little bit.  There were too many tales circulating.... dealers who claimed Amerapress pressured them into buying thousands of dollars worth of inventory.  How could two companies be exactly alike but one's a good guy and one's a bad guy??

Well, I didn't have to wait long to find out.

Amerapress closed its doors too.

Here is how they worked:

Both companies offered dealerships through the seminar circuit for about $495 (depending upon which seminar got your money).  Both companies used "prepaid order forms" (Summit called them "ATMs" and Amerapress called them "DRVs," but the people in my Disgruntled Dealers' Coalition just called them "Junk.")  Both of these nifty "prepaid" order forms required the customer to enclose an additional fee for shipping & handling (in the neighborhood of $5.95). 

They both concentrated their efforts on pressuring their distributors to buy a ton of "inventory" (ATMs or DRVs) right up front (known as "frontloading" or "making their profit on the front end").  Their "marketing consultants" claimed it was impossible to run a successful fundraiser without having thousands of these things on hand.

So why did we call them Junk? 

Because nobody wanted them.  People didn't want to pay (whatever the dealer was charging, usually $18 to $28 or so) for 16 or 18 personal trading cards and then be expected to cough up $5.95 more for postage.  And people didn't want to BUY an order form. 

Naturally I thought it was just me.... but strangely enough, I managed to find another 600+ Summit dealers who had the same problem.

I was able to find two.... (count 'em, two!).... people who were wildly successful with Summit, but they were each able to find a highly-specialized niche that had nothing to do with the bottomless "niches" The Scummit mentioned every time they turned their Terrorists (sorry, I meant "personal marketing consultants") loose on a hapless dealer with a credit card.  One of these ladies managed to land a government contract, and another signed on with a university football team. 

But for the average guy on the street, people just won't beat down your door trying to get these things, despite how adorable your kids might look on the sample cards. 

And here's the corker:

There are companies producing these cards that won't charge you ONE DIME to sell their products!  And they'll do custom orders!  And they won't try to sell you any inventory!  And you don't have to sell order forms!!  Or tack on $5.95 postage!!  Whee!!

Can you see the difference here?

Summit was making money on the opportunity and on the inventory....

TURNING THEIR DEALERS INTO CUSTOMERS....

and the companies that don't charge you are making money on their PRODUCTS ALONE.  These are the ones who "don't succeed unless you succeed."

Were The Scummit and Amerapress ever in the business of selling cards, or were they (as I suspect) strictly in the "Biz Op" business? 

I can't say for sure.  I know they filled some of their orders.  But I also know that The Scummit left a trail of destruction in its wake.  Their last (mad-as-hell) printer called me on the phone, in fact, and told me they owed him over half a million dollars.  My own Scummit Goon (uh, "personal marketing consultant") told me this guy was their seventh printer, and The Scummit never paid any of them.

What happened to the dealers?

The vast majority of them were left deep in debt (some hopelessly).  I lost $8,000 on this deal, but I was lucky. Many, many people in my group lost $15,000 to $20,000, and one man let them talk him out of $50,000!  He later negotiated a "partial buyback" which left him only(?!?) $39,000 in the hole.

And the Scummit?

Don't worry about them.  They came out smelling like a rose because they didn't NEED to sell cards or fill orders to make bucks....

All they needed to do was sell the OPPORTUNITY and the INVENTORY. 

Sure, the FTC filed charges against them.... but not criminal charges.  The FTC can't do that, and the FBI wasn't interested.  So they're free to open up another company and do it all again.  (In fact, there's a rumor that they did just that.... ever hear of an MLM called MPower?)

And what are the Amerapress people doing right now?

I don't know.  But I know what their dealers are doing.  Some of them are working two and three jobs while they scramble to pick up the pieces of their lives.

I know I keep repeating myself, but it is SO important:

When weighing the pros and cons of a business opportunity, figure out WHERE THEY MAKE THEIR PROFIT, and that's usually all you need to know.

Take me back to the Scams 101 Index!

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