DS-MAX

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DS-Max ("Direct Sales to the Maximum"), or more precisely D S Max USA Inc [1] and its affiliates, is a direct sales company that originally specialized in selling discount/overstock/damaged merchandise, and later expanded to include sales of discount coupons, telecommunications contracts like AT&T, credit card processing services, and so forth. Started in Toronto, Canada in the late 1970's by Murray Reinhart who began selling goods directly to the public, it later expanded to become an extremely large organization, with thousands of affiliated offices and a presence in numerous countries. Murray Reinhart recruited fellow Canadians Larry Tannenbaum and Avie Roth to join the organization at the very genesis of what would become DS-Max worldwide. These three men are known as "The Big Three" in DS-Max folklore. Today, Larry Tannenbaum is the most powerful man in the DS-Max network. He oversees all operations over every division. Avie Roth oversees all of Cydcor. Murray Reinhart is retired from the business but does occasionally show up at DS-Max conventions to deliver high spirited motivational speeches.

In 2003 DS-Max divided into three main braches. The products division (Clearance) became Innovage [2].The advertising division became Granton Marketing, which has just recently been renamed Smart Circle International[3] . The communication division became Cydcor [4]. These three divisions are still under the DS-Max umbrella but this connection is not promoted and even avoided if possible when discussing the structure of the business with new distributors.


DS-Max is reported to have more than 15,000 offices around the world and more than 2.2 million independent distributors. The company is said to have a presence in more than 40 countries and a net worth of 75 Billion US Dollars. However, because the company is privately held and represents a loose confederation of independent offices there is no reliable way to verify these estimates. The name DS-Max is often used to refer to the whole distribution system that includes DS-Max USA Inc., its affiliated suppliers and independent offices. Each affiliated sales office is an independent and incorporated business. This legal separation between the DS-Max supplying organizations and each individual office insulates DS-Max from any legal or financial liability should something happen within an individual office. Because all sales office are independently owned and operated each individual distributor and manager/owner reaps the rewards of and is both financially and legally responsible for his own business. The majority of all distributors work as independent contractors and thus are not paid a salary, receive no health benefits and are responsible for paying their own taxes.


The DS-Max system runs similarly to network marketing businesses but with several key differences:

1) Sales representatives (distributors) generally work full-time (often six days, 60 hours or more a week), relying on their sales for their primary source of income, rather than a slow transition from part-time to full-time.

2) The individual owner assumes the cost and advertises for new distributors and finds a mentor for them, rather than the distributor absorbing the cost of recruiting.

3) Distributors receive the products on consignment rather than paying for them up front and there is no fee for becoming a distributor.

The business only grows when new distributors are added. While DS-Max as a whole has grown quite large through the years, some distributors and managers who ran affiliated distribution operations in the DS-Max system have not enjoyed success. Ds-max has produced its share of millionaires, but many more have tried and failed.

All participants begin as canvassing salespeople (door to door, both residential and commericial) and must work to build their organizations by adding more sales people to achieve higher incomes.

Affiliated companies include Innovage, Smart Circle International, Cydcor, Grupo B&F, The Cobra Group Appco and IPG Imports, among others. Innovage is a participating member in the Direct Selling Association and, as such, is bound by the organization's code of ethics. However, the fact that each sales office is an independent incorporation makes the implementation of these strict guidelines on ethical conduct very diffilcult to enforce.

The operations of DS-Max-affiliated "offices/companies" have been criticized by some former distributors due to improprieties allegedly perpetrated by independent corporate distributors (managers/owners) including deceptive recruiting practices, false promises and the encouragement of deceptive/aggressive sales practices. It should be noted that the companies named in this article all issue strict guidelines on recruiting and sales practices, they have the ability and obligation to stop supplying independent distributors who fail to live up to ethical standards.

One of the most common complaints about DS-Max affiliated companies is in their recruiting and advertising practices. Usually the position is advertised as an "entry level management position", when in reality the position is that of door-to-door salesperson, which the applicant only discovers during the second interview. While there is no doubt that the opportunity to become a manager exists, it allegedly creates a false expectation on some applicants, some of whom have complained that it was a waste of their time.

A common interviewing process used by the independent sales offices consists of a very short first round interview conducted in the office of the manager. The second interview is a full day interview in the sales field where the potential distributor shadows a current distributor while they attempt to sell their products or services door-to-door. This full day interview is an attempt to show the potential distributor how a typical day in the field works. This full day interview, like the first interview is vague on details as most questions are not answered fully or more often passed on to the manager/owner to answer during the final interview. This final interview takes place in the manager's office when the potential distributor returns after a full day in the field. The goal of every manager is to encourage the interviewee to start full time the very next day.


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