Analyzing the opportunities
Please read this introduction before proceeding to the main home page
This site was started to aid individuals involved in some way with the business opportunities offered by Scent-Sations, Inc. This includes current and past Distributors along with those who are contemplating becoming a Distributor.
The effort reflected in this site was begun by Distributors actively evolving their businesses and business plans.
Those business plans included a full analysis of the economics of the business including profit potential and information to inform pricing decisions.
Over time, while working through the business plans, questions began to emerge. This site contains the writings regarding those questions.
Ultimately, the key questions that emerged came down to:
Are the business opportunities being marketed by Scent-Sations, Inc. a good deal?
Is Scent-Sations, Inc. a company you want to help prosper?
This site focuses on using facts and data to answer those questions.
It should be noted that some sections of the site have not been completed and others have not been fully reviewed.
Having said that, however, the paths that are being followed on the site are the right ones to answer the questions posed above, and the methods being used come from sound, accepted business analysis techniques.
As we began to analyze Scent-Sations' business model and opportunities it became apparent that the models we were accustomed to (more conventional retail businesses) we're not applicable to Scent-Sations. For example, Scent-Sations' Candle of the Month sends commissions to upline players based on a downline's purchase. In more conventional retail, commissions, if used, would be paid based on sales not purchases.
Because of this we realized that part of the work would be to describe the underlying business model(s) being used by Scent-Sations. We began to see that there were two business streams: one for retailing and the other for recruiting. The comparison of the retail opportunity and the recruiting opportunity seemed important to the model particularly if one provided a greater incentive than the other.
Its in the Profile section of the site where we attempt to extrapolate the Scent-Sations Business Model from information that we've gathered.
Scent-Sations is certainly a Direct Selling company. Direct selling companies with a business model similar to Scent-Sations are a category of businesses sometimes called Multi-Level Marketing (MLM) companies.
Much analysis has been done (and is available on the web) regarding MLMs and particularly those that fall into a category thought to be at least unfair if not illegal. We've read much of that information and it's excellent. On the Pyramids page you will find links to a few of the sites we feel are led by the subject matter experts in these areas. We are in contact with the leaders of some of these efforts and share information openly. Their efforts to a great extent were instrumental in getting us started in this work.
However, much of their work boils down to an analysis of the residual payout model (also know under various other names). This is the model that forms the basis of the use of the term "pyramid" and is the compensation system for incentivizing recruiting. It is comprehensive and sometimes a bit overwhelming. The experts present their work as a theory based on their belief that the recruiting payout structure used by many MLMs forms a structure inherently designed to produce extremely high percentages of people who will lose money while a very low percentage will receive those loses as incentives.
As good as this work is, there is little that helps the individual making a formal business decision.
But the incentive payout models of these companies is only half the story. The other half is the retailing opportunity that these companies market. In fact, if the business failure rates are high (caused by very low returns or losses by retailers) then there must be something happening in the retailing business that is causing those failures.
What we haven't been able to find in abundance are professional analyses of the business opportunities being offered by these companies in the retailing area. If, as we suspect, that it is extremely difficult to make a reasonable profit in retailing, the facts and data provided by this type of analysis should point that out. We also believe, based on the experience from Scent-Sations, that, over time, the MLMs will move to increase the payouts to their recruiters at the expense of their retailers.
Part of our focus here is to perform that opportunity analysis.
The Opportunity portion of the site is roughly organized around the elements called for in a formal Business Plan. It also includes a detailed analysis of potential margins available in retailing along with an analysis of expected "effort vs. reward".
Another main area of the site is a Log containing decisions and events the occur in Scent-Sations and an analysis of the ramifications of those actions.
The site also includes an area that is a collection of Questions we would like to have Scent-Sations clarify and/or justify. Some of these questions are intended to be ones that any business owner might ask of his or her product supplier. We also keep some of our own unanswered questions in this section which may get answered as we continue the business analysis.
One last thing: We recognize that the content of this site is overwhelmingly text. To accomplish our intent of creating understanding, the site will need some non-text additions. The first place where we intend to create something a bit more dynamic is in the Opportunity section which lends itself nicely to spreadsheets and graphs.
Enjoy and remember this site is very much under construction.