Ecoquest Bankrupt – What Do Reps Do Now?

Phoenix EQ Holding Co. Inc., also known as EcoQuest Holding Corporation Inc., the company that owned Eco Quest International, filed a Chapter 11 bankruptcy petition about a month ago.

Chapter 11 of the United States Bankruptcy Code does not refer to a process of liquidation of the company, but rather allows for reorganization under the U.S. bankruptcy laws, so that the debtor corporation can propose a plan for reorganizing the company in order to keep it going and pay creditors over time. The meeting of creditors also took place in December, and apparently, the company has more than $4 million in unsecured claims against it from its largest creditors and only “$0-$ 50,000″ in assets.

From 2000 to 2009 EcoQuest were a large manufacturer and marketer of air and water purifiers, based in Greeneville. These products were sold through a network system that comprised tens of thousands of independent distributors. This network seems to have covered the U.S. and a number of countries from Europe, Asia and Australia.
The company had a significant growth, developing new products and employing locally more than 700 people when it was at its peak, a few years ago. It had over $50 million in gross income both in 2007 and in 2008. According to Its president, CEO and majority stock holder, Mike Jackson, it had a distribution network of approximately 100,000 active distributors.

However, sales dropped sharply with the onset of the economical recession and, after unsuccessful efforts to obtain third-party financing, in March 2009, a large part of the assets of EcoQuest was sold to a subsidiary of Aerus Holdings LLC. Mike Jackson stated at the time, referring to his decision to sell EcoQuest, “I had nowhere else to turn.”(as cited by the The Greeneville Sun).

Currently, Phoenix EQ Holding Company is the defendant in a number of lawsuits initiated by creditors all over the country. This is a sad example of how a success story can turn overnight into a nightmare, for all the people involved – management, manufacturing work force (which had been decreased to 200 people) and, yes, distributors. Many of them may have a second business, but I suppose most were mainly dedicated to EcoQuest. This story meant tremendous income loss for everybody.

What can you do, as a distributor, to prevent this loss from happening to you again? The one and only certain approach is not to let your carrier as a marketer and your income as well, depend on a company. …Or two, or more than two for that matter. Companies thrive and then collapse all of a sudden, and you’ll be left with nothing. You career and income should depend on yourself entirely, and on the image you have managed to create for yourself. If you have managed to promote yourself as a marketer over the years, instead of promoting the company’s product, then you’ll suffer no loss, as the people you have sponsored and guided will not scatter once an opportunity has failed; instead, they will follow you to whatever good opportunity you lead them to, as they trust your knowledge and experience.

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