Alpha Program
Commercial Use
Many businesses share the problem of nonperforming assets. These assets could be in the form of empty seats, beds, tables, space, theme parks, personal, machinery, media, staff downtime, excess, idle inventory, slow to sell trucks, boats, caravans, cars and property.
There may be many reasons why these assets are non-performing such as one or more of the following:
▪ The business has a bad reputation for providing quality products, reliable services, non competitive pricing.
▪ The business is in a bad location.
▪ The business has insufficient capital to market it offerings.
▪ The Government fiscal policy and or Reserve Bank monetary policies have diminished the amount of currency in circulation in an effort to reduce inflation. Now buyers have limited money to purchases from sellers.
Businesses seeking to improve bottom-line profits by monetising their non-performing assets in an extremely competitive marketplace with a diminishing supply of AUD currency in circulation need additional inducements to incentivise customers into their businesses and keep them coming back.
It is imperative the inducements they offer focus on for filling their businesses objectives primarily being to improve bottom-line profits.
Introduction
The are two primary methods to improve the bottom-line profits of a business.
Method 1: INCREASE cash sales.
Method 2: REDUCE operating costs.
As cash sales increase and operating costs are reduced bottom-line profits can be improved.
Therefore, these methods must become the businesses objectives and the primary focus when integrating additional inducements into their marketing mix over and above the foundation inducements required by any business to be successful.
Foundation Inducements
The Inexorable law of the marketplace is, a business that cannot compete cannot survive. In order to survive business must off buyers inducements.
The foundation inducements to motivate buyers to purchase is, quality, reliability, accessibility, and service.
As the marketplace gets more competitive astute businesses realise they have to offer additional inducements to gain a competitive advantage.
Additional Inducements
There are four primary additional inducements being used by businesses these days:
▪ the discount inducement, offered by brands such as Groupon,
▪ the convenience inducement, offered by brands such as Uber Eats,
▪ the payment method inducement offered by brands such as Qoin, and,
▪ the added value inducement offered by brands such as FlyBuys and the new arrival on the added value scene Alpha ePay.
The following Profit Analysis's where created to compare the economic viability of using the Discount, Convenience, Payment Method and Added Value inducements to improve bottom-line profits.
TRANSACTION INCOME
▪ In this example the business generates a sale of $200 by offering a 40% discount to incentivise the purchase thus receiving $120.00.
▪ Less replacement cost of goods at 50% being $100.00 leaving a Gross Profit on the sale of $20.00
TRANSACTION OUTGOINGS
▪ The business then has to pay a 20% fee on the cash income amount of $120.00 equating to $24.00 thus making the Total Transaction Outgoing of $24.00.
▪ When the Total Transaction Outgoings of $24.00 are deducted from the Gross Profit of $20.00 the business is left with a Profit decrease on the sale of -$4.00
TRANSACTION INCOME
▪ In this example the business generates a sale of $200 by offering convenience to incentivise the purchase.
▪ Less replacement Cost Of Goods at 50% being $100.00 leaving a Gross Profit on the sale of $100.00
TRANSACTION OUTGOINGS
▪ The business then has to pay a 35% fee on the cash sale amount of $200.00 equating to $70.00 thus making the Total Transaction Outgoings of $70.00.
▪ When the Total Transaction Outgoings of $70.00 are deducted from the Gross Profit of $100.00 the business is left with a Profit on the sale of $30.00
TRANSACTION INCOME
▪ In this example the business generates a sale of $200 by offering to accept 60% of the sale income in cash ($120.00) and 40% of the sale income in Qoin (Q$80.00) to incentivise the purchase.
▪ Less replacement Cost Of Goods at 50% being $100.00 leaving a Gross Profit on the sale of $20.00 in cash and Q$80.00 in Qoin
TRANSACTION OUTGOINGS
▪ The business then has NO transaction fee on the sale amount of $200.00.
▪ When the Total Transaction Outgoings of $00.00 are deducted from the Gross Profit of $20.00 Cash and Q$80 Qoin the business is left with a Profit on the sale of $20.00 Cash and Q$80 Qoin
TRANSACTION INCOME
▪ In this example the business generates a sale of $200 by offering to pay 40% of the sale price back in Alpha silver dollars as an added value reward to incentivise the purchase.
▪ Less replacement Cost Of Goods at 50% being $100.00 leaving a Gross Profit on the sale of $100.00.
TRANSACTION OUTGOINGS
▪ The business then has to pay a Transaction Fee of 5.5% on the cash Sale Value amount of $200.00 equating to $11.00 thus making the Total Transaction Outgoings of $11.00.
▪ The business also has to pay 40% of the sale price back being As$80.00 in Alpha silver dollars to incentivise the purchase. (The As$80.00 Alpha silver dollars used as a reward in this example where generated at no cash outlay cost as they where received from making previous sales accepting the gross profit or the percentage that would have been discounted anyway in Alpha silver dollars.)
▪ When the Total Transaction Outgoings of $11.00 are deducted from the Gross Profit of $100.00 the business is left with a Profit on the sale of $81.00
This image summarises the Profit Analysis's calculated in the previous examples.
▪ Discount Inducement -$4.00
▪ Convenience Inducement $30.00
▪ Payment Method Inducement $20 Cash + Q$80.00 Qoin.
▪ Added Value Inducement $81.00
In order to achieve a real understanding of how each type of inducement can impact a businesses bottom-line profits we have created the following Profit and Loss statements which are all compared to the business's Present Position as displayed directly below.
INCOME
▪ In this example income is made up of Existing Sales of $500,000.
▪ Less Cost Goods at 50% is $250,000, which leaves a Gross Profit of $250,000.
OPERATING COSTS
▪ Less Fixed Costs, apportioned to mortgage, phone, power, leasing, wages, etc., $100,000.
▪ Less Variable Costs, apportioned to printing, freight, packaging, chemicals, building maintenance, vehicle maintenance, sign writing, etc., $90,000, which gives us a Total Operating Cost of $190,000.
▪ If we deduct the Total Operating Costs of $190,000 from the Gross Profit $250,000, we find the business has generated a Profit of $60,000.
INCOME
▪ In this example the business has Existing Cash Sales of $500,000, as in Present Position Example, with a Groupon incremental sales increase of 10% being $50,0000 less the 40% discount leaving the income amount of $30,000.
Less Cost Goods @ 50% on $550.00 sales value equals $275,000 leaving a Gross Profit of $255,000.
OPERATING COSTS
▪ Less Fixed Costs, apportioned to mortgage, phone, power, leasing, wages, etc. $100,000.
▪ Less Variable Costs, apportioned to printing, freight, packaging, chemicals, building maintenance, vehicle maintenance, sign writing, etc. $90,000.
▪ Less Groupon marketing fee of 20% on the $30,000 of discounted income equaling $6,000 which gives us a Total Operating Cost of $196,000.
▪ If we deduct the operating costs of $196,00 from the Gross Profit $255,000, we find the business has generated a Profit of $59,000 and a Profit Decrease of $1,000 or 1.67 % from the Present Position Example above.
INCOME
▪ In this example the business has Existing Cash Sales of $500,000, as in Present Position example, with a Uber Eats incremental sales increase of 10% being $50,0000.
▪ Less Cost Goods @ 50% on $550.00 sales value equals $275,000 leaving a Gross Profit of $275,000.
OPERATING COSTS
▪ Less Fixed Costs, apportioned to mortgage, phone, power, leasing, wages, etc., $100,000.
▪ Less Variable Costs, apportioned to printing, freight, packaging, chemicals, building maintenance, vehicle maintenance, sign writing, etc. $90,000.
▪ Less Uber Eats marketing fee of 35% for generating the $50,000 incremental sales increase equaling $17,500 which gives a Total Operating Cost of $207,500.
▪ If we deduct the Total Operating Costs of $207,500 from the Gross Profit $275,000, we find the business has generated a Profit of $67,500 and a Profit Increase of $7,500 or 12.50 % over and above the Present Position example.
In this example, note we have $ IN '"Cash IN"), $ OUT ("Cash OUT"), Q$ IN ("Qoin IN"), and Q$ OUT ("Qoin OUT") columns in the ledger.
▪ In this example the business has Existing Cash Sales of $500,000, as in Present Position example, with a Qoin incremental sales increase of 10% made up of $30,000 paid in Cash and Q$20,000 paid in Qoin.
(NB. The key benefit in accepting alternative currencies like Qoin to improve bottom-line profits is how a business uses this incremental income. In this example the business accepts the Q$20,000 Qoin as a method of payment to incentivise $50,000 in purchases and then uses the Q$20,000 Qoin to offset against its Variable Costs in order to Reduce Operating Costs.)
▪ Less Cost Goods @ 50% on $550,000 sales value equals $275,000 leaving a Gross Profit of $255,000.
OPERATING COSTS
▪ Less Fixed Costs, apportioned to mortgage, phone, power, leasing, wages, etc., $100,000.
▪ Less Variable Costs, apportioned to printing, freight, packaging, chemicals, building maintenance, vehicle maintenance, sign writing, etc. totaling $90,000 and paid $70,000 in Cash and Q$20,000 in Qoin.
▪ Less Qoin transaction fee for generating the sales increase of $50,000 being zero give a Total Operating Cost of $170,00 Cash and Q$20,00 Qoin.
▪ After the Total Operating Costs of $170,000 Cash and Q$20,00 Qoin are deduct the Gross Profit of $255,000 Cash and Q$20,00 Qoin we find the business generated Profit of $85,000, a Profit Increase of $25,000 or 41.67% over and above the Present Condition example.
In this example, note we have $ IN ('Cash In"), $ OUT ("Cash Out"), As$ IN ("Alpha dollar In"), and As$ OUT ("Alpha dollars") columns in the ledger.
▪ In this example the business generated a 10% increase in Existing Sales of $500,000 from previous transactions paid for 60% Cash ($30,000) and 40% in Alpha dollars (As$20.00).
(NB. The key benefit in accepting alternative currencies like Alpha silver dollars to improve bottom-line profits is how businesses use this incremental income. In this example the business uses the As$20,000 Alpha silver dollars to pay customers 30% back as an added value reward to incentivise cash purchases of $66,500 thereby Increasing Cash Sales.)
▪ Less Cost Goods @ 50% on $566,500 sales value equals $283,250 leaving a Gross Profit of $283,250.
OPERATING COSTS
▪ Less Fixed Costs, apportioned to mortgage, phone, power, leasing, wages, etc., $100,000.
▪ Less Variable Costs, apportioned to printing, freight, packaging, chemicals, building maintenance, vehicle maintenance, sign writing, etc. totaling $90,000.
▪ Less Alpha transaction fee of 5.5% equaling $3,657 for generating an incremental sales increase of $66,500 thereby a Total Operating Cost of $193,657 Cash and As$20,00 Alpha silver dollars.
▪ After the Total Operating Costs of $193,657 Cash and As$20,00 Alpha silver dollars are deduct the Gross Profit of $283,250 we find the business generated a Profit of $89,595, a Profit Increase of $29,593 or 49.32% over and above the Present Condition example.
This image summarises the Decrease and Increase on bottom-line profits by using the four primary additional inducements types that are used by businesses today.
It is important to note that a business may have to use a mix of inducements to achieve their economic objectives but as can be seen, discounting is defiantly not the way to go.
As can be seen in the Profit Summary Comparison above the use of the Payment Method and Added Value inducements have the greatest positive impact on a businesses bottom-line profits.
As previously stated in the Introduction the two primary methods to improve the bottom-line profits of a business are:
Method 1: INCREASE cash sales.
Method 2: REDUCE operating costs.
Businesses accept Alpha silver dollars to incentivise purchases and then use the Alpha silver dollars as an added value reward to Increase Cash Sales.
Businesses accept Qoin to incentivise purchases and then use the Qoin as a payment method to Reduce Operating Costs.
The Alpha Program assists businesses fast track the sale of non-performing assets by enabling them to monetise the value normally discounted or gross profit in their sale value into Alpha silver dollars through listings in the Alpha eMarket.
They can intern use the Alpha dollars as an added value reward to incentivise purchases paid for with AUD-Based and Crypto-Based payment methods.
This video explains the rational as to why businesses should promote their business in the “Payment Methods Accepted” and or “Payment Methods Rewarded” listings at the Alpha eMarket.
Many business do not display the payment methods they accept on their websites which can make it frustrating for buyers who seek to use methods such as AMEX and Diners or any of the alternative methods to pay for purchases.
There is also a growing number of businesses who now don’t accept notes and coins and these can be found in the Alpha eMarket listings.
This video provides a comparison analysis showing the bottom line benefits to restaurants by using the Alpha Added Value Model offer promoted through the “Payment Methods Rewarded” listings in the Alpha eMarket as opposed to listings in a Discount style model like Groupon or a Convenience style model style like Uber Eats.
The rational applied to the content of the video can be applied to many other businesses
Customer loyalty is a proven way to not just sustain market share, but to grow it.
In most mature brands, over 85 percent of growth comes from their most loyal customers.
The comments above and stats displayed right are from a report published by KPMG.
Businesses offer Alpha silver dollars to their customers as an inducement to RETAIN their AUD business and to other Program members as an inducement to GAIN their AUD business.
Businesses can offer a high percentage of Alpha silver dollars to increase AUD sales in times that are traditionally slow or a low percentage of Alpha silver dollars to slow down AUD sales in times that are traditionally busy.
Consumers may intern use the Alpha silver dollars received for FREE as a Purchase Reward, or BORROWED interest FREE, towards the purchase a wide range of products and services inclusive of vehicles, watercraft and property by sellers promoting to accept them through listings in the Alpha eMarket.
If a business is presently using less than 100% of its potential capacity to produce, or supply goods and services, it will realize an increase in incremental sales through participation in the Program.
Under-utilised space, time, equipment, personnel and inventories are monetised into a new profit centre.
Businesses can show their existing customers they value their business by rewarding them with Alpha silver dollars for purchases paid for by AUD and or Crypto-Based payment methods.
Well accepted facts on customer retention:
▪ Increasing existing customer retention rates by 5% increases business profits by 25% to 95%
▪ It costs a business 5-10 times more to acquire a new customer than to sell to an existing one
Businesses can attract new customers by showing them they value their business by offering them Alpha silver dollars as a reward for purchases paid for with AUD and or Crypto-Based payment methods.
Alpha ePay marketing costs are performance based and are up to 70% lower than other models such as ebay/PayPal, Amazon/Amazon pay, Alibaba/Alipay, UberEats and Groupon etc.
After businesses join Alpha ePay they are shown how to generate the Alpha silver dollars that may use as an added value reward at ZERO cash outlay cost to create.
Businesses may offer debtors Alpha silver dollars as a reward to pay their AUD accounts in a timely manner. When debts are paid cashflow and liquidity are improved
Debtors can join the Program free of charge, and the Alpha silver dollars they receive may be used towards payment of a growing variety of purchases.