In a stunning, yet not surprising move, YTB announced that the RTA program will be going away. As both Arnie Weissmann and I had said, YTB cannot survive in travel as an MLM. Maybe Scott has finally determined that MLM and travel is indeed a bad mix!
But the question remains, what about the millions and millions of dollars paid annually by the RTAs to YTB? I guess the new legitimate company was indeed founded on the backs of the RTAs.
On July 15, 2008, Mr. Scott Tomer, Chief Executive Officer of YTB International, Inc. (the "Company"), announced that the Company is contemplating the replacement of its referring travel agent ("RTA") business model with the implementation of a franchise operating system, potentially in 2009. The Company expects that a franchising model, if adopted, would facilitate the Company's expansion into additional markets by providing more comprehensive training and a new proprietary e-commerce platform. Details regarding price, product offerings and the conversion plan are all under consideration, but the Company anticipates that its existing RTA base would be treated favorably under its forthcoming proposal. If a franchising model is adopted, its distribution is expected to be managed by subsidiary and current marketing arm of the Company, YourTravelBiz.com, also known as YTB.com.
The information in this report shall not be deemed "filed" for purposes of
Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), or incorporated subject to the liabilities of that section or Sections 11 and 12(a)(2) of the Securities Act of 1933, as amended (the "Securities Act"), and shall not be incorporated by reference in any registration statement or other document filed under the Securities Act or the Exchange Act, whether made before or after the date hereof, regardless of any general incorporation language in such filings, except as shall be expressly set forth by specific reference in such a filing.
Wow. I am completely shocked and happy they are taking steps in the right direction. What happens to all the current RTA's? Will they have to now "purchase" a franchaise to keep their websites?
ReplyDeleteHAHAHA! I was just reading this on Yahoo when you posted this!!! YTB idiots, you got screwed!! RTAs go away, YTB sells nothing for travel and within a year or two they fold. With the Tomers walking away with all your money.
ReplyDeleteThanks to all the YTB RATS for financing the Tomers plane and the foam statue.
Hey Doogie what yah gonna do now? And Mix might as well get that McDonalds job now before your fighting with the rest of the rats to get a job.
This made my day...ahahahah!
Well if it is a franchise it will be more than $500 and the RTAs will need to pony up some more cash. There may be a discount.
ReplyDeleteBut the RTAs will now need to determine if they indeed can make money selling travel with YTB and are they willing to put in more money?
Meanwhile, YTB has collected all their fees to the tune of $154 million in the past three years. YTB also legally owns all the names the RTAs put into the system (by contract)
This wil be interesting as I am not sure the RTAs thought this was what Kim Sorenson had in mind when he was legitimizing.
But without the RTAs....there is really no need for Reps.
So YTB appears to be on the way to being one of the largest hosts/franchises in the travel industry.
They woudl be smart to look for industry people to help lead this move!
Well that is some good news for a Tuesday. Wonder what the other blogs will be saying!
ReplyDeleteSo lets wait and see how their numbers look when there isn't a "BONUS" for these referrals. As you know, it's not about "recruiting" but about travel sales. Yeah right.
ReplyDeleteWell I won't belabour a point about credibility but, without knowing anything, like john, or anyone else herre, including myself...how can you say what you are saying????
ReplyDeleteYour blog stated that "YTB announced that the RTA program WILL be going away"
The posting on the finance page says "the company is contemplating the replacement"
Now, again, I don't know what this means, but there is a big difference between WILL and CONTEMPLATING.
I will admit that this is potentially big news for YTB and the RTAs
The key word here is "contemplating." It isn't a done deal and given YTB's track record of announcements ie the Bob Dickinson and other fiascoes I will not believe it until it is in stone.
ReplyDeleteAs to the franchises that will be another version of an MLM. Coach doesn't know how to sell and market anything else. Nor, does Coach know or ever will know the travel industry.
Must be a slow week and with the stock tanking Coach had to cause a stir with a bogus press release....
Maxine, the stock has been up for 3 days, albeit pennies, but certainly not tanking considering the rest of wall st is down
ReplyDeleteFair enough Josh but Coach does have a habit of releasing press releases on whims. I am surprised he doesn't when he stubs his toe.
ReplyDeleteWith recruiting numbers peaked and going to the dumpsters, they have to try something new. Obviously what they have been doing isn't working. Vendors leaving, numbers down, only a matter of time before the company tanks. They have no choice. And of course they aren't going to say it is in cement, "right now". People like the above will keep paying into it, so they will continue to make a fast buck off you until the end. If they said it was in stone imagine the fallout? Just keep paying and losing your money.
ReplyDeleteI don't think it's a bogus release, I think they are honestly considering this. Now they can make even more money on selling the franchises, and very possibly become a large seller of travel if done properly. It was going to go either way, either go legit, or pack it up. They've made the bucks and now have the clients to try it legit, so why not? As an RTA, if they go franchise, are you going to stay? At what price will you refuse?
ReplyDeleteI had a flurry of emails saying that this could be a ploy to increase attendance at the convention or to inflate the stock. I don't think so and here are a few reasons why:
ReplyDeleteThis is NOT good news to the RTAs who have paid money into the program and now it looks like they will have to pay more.
It is not good news to the Reps who have already seen a decline in recruiting and are earning cash off their recruits. Many in YTB will leave because of this.
Making a ploy to the SEC is illegal and VERY dangerous. An old man like Coach would die in prison and Scott--well, let's just say they would love long time in there!
Although the faithful will deny it, YTB is a pariah in the industry. RCCL, IATAN, others. Their only true friend seems to be Carnival.
Sorenson wants to legitimize it. What better way? How can you argue with a host or a franchise.
YTB has been advertising for business development managers (franchise salespersons) in Travel Weekly for some time. This makes this speculation a bit more credible.
I doubt you will see many RTAs sticking around. The price will be high and with what little they sell as it is, they are going to bail left and right.
ReplyDeleteMy question which travel MLM is going to make out the best? Now this will be fun to watch.
I say YTB goes the "real" way and then just drops off the face of the earth, slowly.
I have to agree, I don't see them releasing bogus stuff like this. I think it's more of a we have been thinking about this and when it goes into effect, the shock factor won't be as big as it could be if they just dropped it in peoples laps.
ReplyDeleteSo why didn't the "insiders" like OLE and MIX and Proud and Doogie, see or know about this coming. I know why because the top doesn't want them to and wants the income to continue flowing into their pockets.
Keep i mind that all of the RTAs signed away their rights to market to the clients to YTB. Now we cannot control where a client buys travel, but YTB is legally able to market to every name that an RTA supplied to them.
ReplyDeleteIf they do it right, and an RTA does not stay in the travel biz, the client is likely to buy travel (or at least give it a shot) with whomever is marketing to them effectively.
With the $155 million the RTAs have infised over the past few years, YTB is in a great position to market to these people effectively.
"Hey Doogie what yah gonna do now?"
ReplyDeleteFrom what I can see, I’m going to change hats from an “MLM Owner”, to a “Franchise Owner”!
BIG money in franchising in case you didn’t know, and it also takes away this excuse about MLM’s being a scam.
What will you talk about then?
In addition, I’m an investor in the Company. Have you seen stock prices for some of the big name franchises lately? Go take a look!
Bravo to Coach, Scott and Kim!
I hope this comes to fruition, and licking my chops at a chance to own a piece of a “Franchise”!
Yeah Baby!
PS – Go take a look at one of our Board of Directors kids, Franchising is in his blood and I’m guessing he has something to do with this.
So there will be no more rep'ing, so you'd be making money ONLY by selling travel now or am I off base thinking this? You would need a decent client following to run your own franchise which I'm sure alot probably do not have yet, so will it justify the cost?
ReplyDeleteWell thats what it looks like.
ReplyDeleteI can only imagine the lies that will come out from the Reps now. People will be scrambling to recruit recruit recruit until this goes into effect. It will also for a short time raise YTB numbers and the client list, as people scramble to make up for their lost money.
So someones son is now running YTB because those at the top can't make a smart decision?? Yeah, sounds like a company I want to work for.
ReplyDeleteAt first YTB didn't need RCCL, then they didn't need IATAN, then they didn't need RTA/Reps. What a great company! Not.
ReplyDeleteWell, the west coast is just waking up to this bit of good news! I think if you can listen very carefully, you will hear the sound of 305,000 Reps and 130,000 RTAs collectively sh$%^ing a brick.
ReplyDeleteOf course Doug says it is a good thing for him, but time will tell.
My guess is that a huge number of RTAs will drop from this program...causing the bonuses to their upline reps to go away...and the reps will leave in droves as well....and this seems to be the way the cookie (or pyramid) crumbles.
And I hope the Tomers thought this through. My guess is probably not since Scott admittedly has no education. There are some serious ramifications. It will be interesting for sure!
Ya think the timing of this (just after the deasline to save a buck or two at the annual convention expired) had anything to do with it? Might as well get as many signed up as we can and get their $150
Doug is right. There is BIG money in franchising. The franchisee pays the company big money to use the name, big money to use the products and big money for the franchise fee every month or year. If the franchisee can run the biz successfully, theres money in that as well. Time for that training YTBites!
ReplyDeleteDoug, you really are an optimistic fool. I think it's time for you to strap on your tool belt and find a real and honest job. If YTB said they were closing tomorrow, you would pretend to see a bright side of that. I pity your wife.
ReplyDeleteThe problem is, your everyday person will not be able to afford a expensive franchise license. This was part of the pitch from YTB, anyone can own a travel agency, and you don't have to pay thousands. I guess this is about to change. We are going to see who is serious about selling travel. My guess most of them drop out and move along.
ReplyDeleteWhat a great day it is.
Or alot of them will join the ranks of the "other" MLM travel companies and still make no money.
ReplyDeleteYou people crack me up. I see you are a bunch of CFOs at your best.
ReplyDeleteCFO -- Can't Figure it Out!
If you people weren't blinded by hate your eyes could read what I plainly see in the text.
Bruce you need to notice one sentence in the announcement: If a franchising model is adopted, its distribution is expected to be managed by subsidiary and current marketing arm of the Company, YourTravelBiz.com, also known as YTB.com.
The marketing arm is going to manage the franchising model.
That tells me there is still going to be recruiting.
YTB has more than 1 arm/subsidiary:
1) YTB Travel Network -- RTAs
2) Yourtravelbiz.com -- REPs
3) RezConnect Technology - Franchises
RTAs sell travel
REPs sell travel businesses
For example,
David markets and sells travel as a YTB Travel Network RTA from this site.
David markets and sells online travel businesses as a YourTravelBiz.com REP from this site.
Do you suppose the YourTravelBiz.com REPs will be marketing and selling the franchises under consideration?
Its sounds like YTB is making an end run around all of the vendors that have issues with them. Instead of RTAs being Independant Contractors of YTB. They will be franchise owners. It could be that now the franchisees will be responsible for getting their own IATAN, CLIA and other accreditations. This could potentially allow the franchisees to start selling Royal Caribbean again.
Rod--so, after three years of earning nothing in YTB. Three months of "retirement" from YTB while you investigate if it is a good deal for you, you really have no room to be calling someone a "Can't Figure It Out".
ReplyDeleteAre you aware of the regulations required to sell a franchise? Maybe that is why YTB went into a bixop because under $500 and it is not regulated. They cannot control their people now, how are they going to handle UFOCs? YTB has been hiring Business Development Managers (yes employees) and I suspect it is to facilitate franchise sales--not the 305K Reps.
You can bet the cost to be a RTA (or its incarnation) will be more than $500 so now it is a harder sell. And will the existing RTAs be willing to pay more to maintain that $92 a year income level?
And if some RTAs should leave, what happens to their sponsors who are earning bonuses on the fact that the RTA exists.
And speaking of that, how does this all work with the "copyrighted" compensation plan that "can't ever be changed" and that is on file with all of the stats' attorneys generals? What about the Bill of Rights? Whose rights did it protect?
Did they jsut change that?
Rod guess you missed this part..
ReplyDelete"announced that the Company is contemplating the replacement of its referring travel agent ("RTA") business model with the implementation of a franchise operating system, potentially in 2009".
REPLACING. Thus no longer RTAs.
"Details regarding price, product offerings and the conversion plan are all under consideration, but the Company anticipates that its existing RTA base would be treated favorably under its forthcoming proposal."
ReplyDeleteRod, I'm on the phone right now...
You're on the right track. ;-P
Let these idiots talk about it all they want. This is HUGE news and I'm going to put 08/15/2008 at 10:21AM down in my calendar.
By the way...don't count on hearing anything about this at the Convention going in or coming out of the Convention from the company.
Nothing is chaging right now.
I could spend all day here educating the CFOs.
ReplyDeleteJohn, you first. Scott did not say he was going to change the REP compensation plan which is what the Bill of Rights covers. It's called the "REPs Bill of Rights" RTAs Bill of Rights, got it?
Now you Malique the Anti-YTB fanatic: All I can say is whatever they are replacing RTAs with is going to be managed by the YTB REP subsidiary.
John, I meant to say it's called "REPs Bill of Rights" not the RTAs Bill of Rights, got it?
ReplyDeleteThere is big money in franchising, but NO ONE in their right mind will buy a travel franchise with NO IATA!!! What a freaking joke!
ReplyDeleteWhat difference does it make if the rtas are treated favorably? The majority of them don't want to be travel agents and are already losing money. It's doubtful that the rtas will be the ones buying the franchises.
Rod,
ReplyDeletePlease do us all a favor and go back to YTB already. You seem to love them so. As for the CFO comment, tread carefully, I believe you were the one in YTB for how many years and Couldn't Figure it Out. Pot..kettle is calling.
Rod, you would think after all the time you have spent with YTB, that you would have a open eye for what YTB is doing and has done. There are thousands upon thousands of people that they made promises to that haven't made a dime. Spending hard earned money (real jobs unlike what Doogie claims), only to lose more and more. It won't matter what YTB does, it will all be based on sucking dry the poor saps as yourself. Wake up and open your eyes.
ReplyDeleteI agree K Holmes, an IATA is a must for a franchise.
ReplyDeleteI also think that the so called bill of rights could disappear with YTBs change.
And, since you will all have to pony up more money you can bet that they will do credit checks on all of the new franchisees. How many of you can pass a basic credit check?
ReplyDeleteBad check charges, late payments, defaults all reflect on your credit score. Does the Jail to Yale recruits have the right credit score?
Hmm...seems like Doogie has been "on the phone" for quite some time now. If he had any good news he would have posted it immediately. My guess, if he even did make the call, that they are declining to say anything at this moment. They want to collect that $150 from the people at the convention. Bad news would mean even less people going to see the "Statue of Gullibilty".
ReplyDeleteThe attendance should rocket. Last night at midnight was the last time to get the discounted admission. This was released this morning, so I imagine those that were not planning on attending will plan on it now to find out what the scoop is.
ReplyDeleteI don't think a franchise needs an IATA endorsement. They are not the entity selling travel--the franchisee is. Wow, I bet CLIA is excited 130,000 RTAs each needing to be a CLIA agency at $399 a pop. Now as a host, the IATA is critical.
Will be interesting to see how it all plays out.
I am sure Doug is not getting too much info from HQ. I Have heard that they are not commenting yet to the trades. Maybe by the afternoon.
Just remember, you read it here first folks! :)
Interesting news, but rather frustrating really only getting a “tease” of what is to come.
ReplyDeleteThey may just turn the producing RTA’s into franchises if the RTA is really demonstrating sales. Quite a few of the existing travel franchises will take an agent with a proven track record and let them become a new franchise for an amount far less than the sell to a new person in the industry. But with the franchise generally comes a monthly loyalty fee plus a percent of sales going to the headquarters. Should be interesting to see how this plays out.
Rod, I doubt highly that they would want the franchise to get their own IATAN, CLIA, whatever for booking purposes. Just like now they would want the franchises booking under the corporate numbers for tracking purposes (did I say tracking in regard to YTB?!?!?!) and to ensure they are getting their percentage of the commission. Maybe they are trying another run around by converting to franchises to try to get their IATAN back.
Franchises also generally require that background checks be done on owners—both financial and criminal. Wonder how that would work for the “Yale to Jail” mentality. This is critical because with a franchise you are buying into an organization and don’t want someone “dirty” the name.
Franchises are not required to have their own CLIA, most work off the headquarters number. Very few spend the money for thier own number.
ReplyDeleteIATA -- I can't imagine a franchise without one!
The FTC has some pretty strict rules on franchises. How is Coach and the gang going to get around that? They don't like to play by the rules at all or fully disclose anything. Violations are severe. Should be interesting.
ReplyDeletehttp://www.ftc.gov/bcp/franchise/netrule.shtm
Cruiselover you are mistaken. Most franchises (Carlson, Amex Rep Agencies, etc)and consortias (V.com,Virtuoso, Ensemble, etc) do indeed have ARC, IATAN, CLIA appointments but are not required. They are in place for a lot of their own travel. When you join any of these, you (as the individual) need to have whatever credentials and appointments you need. So each independent CWT agency has their own IATA number. Actually getting an IATA number is a requirement of the CWT franchise agreement.
ReplyDeleteA host, on the other hand, is the one that has the master number and the independent contractors book under that number.
Technology (which YTB says they are implementing) can track independent bookings and sales for a franchise, so they can be sure they are getting their money.
And be sure that YTB will make sure that technology is right if they are to be collecting. Versus telling the RTAs what they earned
Pfft...they don't need IATA, RCCL, RTAs or the FTC
ReplyDeleteTravelLisa said...
ReplyDeleteRod,
Please do us all a favor and go back to YTB already.
My due diligence on YTB is not complete at this time. Until then, I'm not going back. If YTB changes some things I want them to, I probably will be going back.
The CFO comment was not directed to you, but go back and look at the ignorant posts of today's top 20 on this topic. Don't you agree it looks like a bunch of CFOs trying to figure it out.
I'm starting to believe that Rod is just a YTBer trying to pull something over our eyes. Nobody in their right mind could be this ignorant.
ReplyDeleteI am sure Doug is not getting too much info from HQ. I Have heard that they are not commenting yet to the trades. Maybe by the afternoon.
ReplyDeleteJust remember, you read it here first folks! :)
Sorry…too busy doing the “giddy dance”. You have to be on the "inside" right now to get any information.
You kids can go about your day, speculating – condemning – accusing – and forecasting what you want.
YTB is contemplating at this point with some very knowledgeable people on how to take this company to the next stage. Since I was part of the first stage, I’m set.
Go read the title of today’s post on my blog, and you don’t have to read anything more, I promise.
Change is good – and those of us who flow with the changes usually benefit.
And yes, a press release about the filing will be issued later today.
“You did read it here first”
I'm out of here!
No Rod, I do not agree. See the difference is ALOT of the agents on this board actually work for travel franchises or hosts, so we know whats required for being one. Are the RTA's going to be able to pony up the dollars to do this? Doubtful majority will. As far as the rep'ing and additonal, I will not pretend to understand how they are going to do it, we will just have to wait and see.
ReplyDeleteBut Doug you don't have a blog. It's just a website with only your super inflated ego comments. Read the definition of a blog.
ReplyDeleteCare to comment on the FTC franchise rules? Loss of IATAN? What about the financial statements and background checks that will be required of all of you YTB franchisees? How many of you will pass that? Any burp in your background will raise flags honey.
Again, a travel franchise with no IATA is worthless.
ReplyDeleteMaybe you should try " can I get you some fries with that today?" It would make a lot more sense.
I thought it was already a franchise. They say you buy your own travel agency in their ads. I don't see what the big difference is. No reputable B&M would ever buy into YTB with it's reputation. I'll be waiting for the press release. I doubt if much is going to change with these idiots running the company.
ReplyDeleteWhat's going to be more entertaining is watching the RTA's actually have to *GASP* work for a change. No more recruiting. No more relying on a website. They are going to have to work. And, keep records and all that fun stuff the rest of us do. Say, good-bye to all the free vacations too. It's going to be very interesting to watch them.
ReplyDeleteAnd, what will Mix, Ole, Doug and Rod do without reading this blog all day long. Regina and Gail too. ROTFLMAO. Should have kept your day job!
Doug doesn't know any more or less than anyone else. It's a good thing he has YTB to make his business decisions for him.
ReplyDeleteWith great business decisions, such as foam and jets, it's no surprise that YTB is going down the tube. The thing is these people won't want to work because most of them want everything for free and done for them.
ReplyDeleteI can't wait to see the excuses coming in!
I think I hear that tumbleweeds blowing by. Alot of questions needing to be answered. Ole, Mix, Proud all silent. The only sound coming from Doogie(who doesn't read this blog, umm k). Of course he wouldn't question them at all. I guess that promotion didn't help YTB out. Guess you failed YTB Doogie.
ReplyDeleteI bet the phone lines are lit up at HQ. But how can YTB HQ answer the phone when they have thousands of vendors lined up outside their doors. I feel sorry for alot of you, I really do. The promises of riches have now turned into the promises of debt.
In the immortal words of Ole Crotchkeeper,
John - 1,000,000
YTB - 0
I hope you can get this link because I think the last laugh is on you all!!
ReplyDeletehttp://yourtravelbiz.com/coachscalls/Static_CoachesCall.htm