As we move forward together into a bright new year, we would like to inform you of some important updates to our Distributor Policies. In-depth discussion with the Presidential Advisory Committee (PAC) and feedback from the Executive Council and Founder’s Circle, as well as many other Distributors, have resulted in some key policy changes that are scheduled to go into effect in the Third Quarter of 2013 (Q3 2013), i.e., July, August, or September, 2013.
I. Distributor Incentive Pricing and Commissions:
- The option of Distributor Incentive discounting will no longer be available on the sale of Drinking Water Systems (DWS); this means that all products must be sold at full retail price.
- Distributors will continue to earn percentage commissions based on their Achievement Level. This is computed on the commissionable net of the product, not on the retail price.
- Distributors will continue to earn the Distributor Incentive (if applicable) in addition to their percentage commission.
EXAMPLE A: Master Builder John Doe sells a below-sink Aquaversa. Its full retail price is $429.95, the Distributor Incentive is $59.95, and its commissionable net is $370. John Doe will receive $59.95 plus 35% of the commissionable net, for a total earnings of $59.95 + $129.50 = $189.45.
What this means in Q3 2013: This means that all retail sales products must be sold at full price. You will receive the Distributor Incentive plus percentage commission on the commissionable net of the product.
II. New Distributor Signup Incentive*:
- Although the option to discount the Distributor Incentive Pricing is eliminated, customers are eligible to receive a $40 discount off of the price of a basic Drinking Water System Starter Kit (i.e., Aquadome Starter Kit, Aquaversa Starter Kit, or Aquaperform Starter Kit), when they sign up as a Distributor at the time of purchase.
- This discount, if given, will be taken out of the Distributor Incentive portion of the system price (i.e., the Distributor Incentive is reduced from $59.95 to $19.95).
*The New Distributor Signup Incentive does NOT apply if the customer does NOT sign up as a new Distributor at the time of purchase of a basic Drinking Water System Starter Kit (i.e., Aquadome Starter Kit, Aquaversa Starter Kit, or Aquaperform Starter Kit).
EXAMPLE B: Master Builder John Doe sells an Aquaversa Starter Kit to a new customer. Its full retail price is $659.95, the Distributor Incentive is $59.95, and its commissionable net is $600. Normally, John Doe would receive $59.95 plus 35% of the commissionable net, for a total earnings of $59.95 + $210 = $269.95. The customer signs up as a new Distributor under John Doe with the Starter Kit purchase, and is eligible for the New Distributor Signup Incentive. If the New Distributor Signup Incentive is given, the customer receives a $40 discount, making the retail price $659.95 – $40 = $619.95. The $40 discount is taken from the Distributor Incentive portion of the price ($59.95), so John Doe receives $59.95 – $40 plus 35% of the commissionable net, for a total earnings of $19.95 + $210 = $229.95.
What this means in Q3 2013: This gives you the option to provide a discount to customers for registering as a Distributor with a qualifying purchase, while still offering you a portion of the Distributor Incentive earnings. It also creates an even pricing field for all Distributors, allowing all to earn more from each sale.
III. Allocation of Commissions for Direct Sales (sales made without a selling Distributor), a.k.a. the CASH program:
- All Active (PAR** qualified) Back Office Distributors may register for the Company Allocated Sales Handler (CASH) program for the allocation of commissionable unit purchases made without a selling Distributor or for new Distributor signups made without a sponsoring Distributor. Distributors may pre-register for the CASH program in the Back Office on June 1, 2013.
- Allocations will progress sequentially through the CASH roster.
- Distributor placement on the CASH roster is on a first-come-first-served basis, determined by the time of CASH registration in the Back Office.
- Any customer drinking water system (DWS) purchase made without a selling Distributor will be allocated for commission to the in-turn Active Distributor in the CASH roster.
- The in-turn Active Distributor in the CASH roster is allocated 25% of the DWS commission that the Distributor would normally earn on a personal sale. This percentage increases to 50% for Founders’ Circle Distributors and 75% for Executive Council Distributors.
- If the purchasing customer also signs up as a new Distributor at the same time, they will be assigned to the 2nd Level of the same Distributor that receives the product commission.
- CASH commissions will also be allocated to the 9 levels of Active upline for the Distributor, at the same CASH allocation percentage as the in-turn Active Distributor.
- Orders allocated through the CASH program do not count toward ALV, MALV, PAR, EC/FC qualification, or contest points.
**Personal Activity Requirement (PAR) is a requirement which enables Distributors to receive commissions on their network sales and filter replacements. To be PAR qualified, Distributors are asked to make a personal sale or purchase of a Drinking Water System with a minimum $165 value every four months. PAR qualified Distributors, a.k.a. Active Distributors, are eligible to receive commissions on sales and replacement filter purchases made in their ten level network. Distributors who are not PAR qualified can only earn commissions on their personal product sales and personal replacement filter sales (Senior Builder or higher).
EXAMPLE C: A customer purchases a below-sink Aquaversa without a selling Distributor. Its full retail price is $429.95, the Distributor Incentive is $59.95, and its commissionable net is $370. The purchase is assigned to the next in-turn Distributor in the CASH program, Master Builder John Doe. John Doe would normally earn $189.45 on a personal sale (See EXAMPLE A). Because he is not EC or FC, the value of the allocated purchase is 25% of $189.45, or $47.36. In addition, the Active members of his 10-level upline also receive 25% of their normal upline commissions. If the purchasing customer signs up as a new Distributor, the new Distributor is assigned to the 2nd Level of John Doe’s network.
What this means in Q3 2013: The CASH program provides an additional incentive to utilize the Back Office and maintain PAR; it provides additional potential revenue through commissions from purchases made directly through Multipure, and it increases network growth through additional downline members from new Distributor signups made directly through Multipure.
IV. Policy on Unpaid Commissions:
- Dormant Distributors (Distributors that have been Inactive/non-PAR-qualified for 36 months or more) with earned but unpaid commissions remaining on their account will receive a commission check from Multipure at the time of their removal from Multipure’s list of Distributors. Unpaid commissions occur when earned commissions remain below the $25.00 minimum value for Multipure to issue a commission check.
- A $5.00 check processing fee will automatically be deducted from this commission check. If the check processing fee reduces the value of the unpaid commission check to zero or below, then the commission check will not be paid out.
EXAMPLE D: Distributor John Doe has not been PAR qualified for 35 months, and as such has been classified as an Inactive Distributor. Upon reaching his 36th month as an Inactive Distributor, he becomes classified as a Dormant Distributor, and will be removed from the Multipure Distributor list. Although he possessed $15.00 in earned commissions, they remained unpaid because the value fell below the $25.00 minimum to issue a commission check. Upon his removal from the Distributor ranks, he is issued a check for any unpaid commissions on his account, less a $5.00 check processing fee. John Doe is no longer considered a Distributor, and is issued a check for $10.00 ($15.00 – $5.00).
What this means in Q3 2013: The Unpaid Commissions policy serves to clear out any earned but unpaid commissions from a Distributor’s account when they are removed as a Dormant Distributor.
Although the scheduled implementation date for these changes is Q3 2013, the exact date is subject to change, and we will advise you about the final implementation date as it approaches. Understand that these changes to Distributor Policy have been discussed and supported by your peers in the field, and are being enacted for the mutual benefit of all of our Distributors.
If you have any questions about these changes, please contact us by telephone at 800.622.9206.