Vector Marketing

Vector Marketing
Subsidiary
Industry Sales
Founded 1981
Headquarters Olean, New York, US
Parent Cutco Corporation
Website www.vectormarketing.com
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Vector Marketing is a multi-level marketing subsidiary company and the domestic sales arm of Cutco Corporation, an Olean, New York-based cutlery manufacturer.[1][2]

History

Vector Marketing Corporation is a wholly owned subsidiary of Cutco Corporation. The firm originated in a joint venture between Alcoa and Case Cutlery known as Alcas Corporation.[3] In 1947, It completed a factory in Olean, New York, and shipped the first set of Cutco Cutlery that year. In 1974, Alcoa purchased Case Cutlery's share of Alcas.

In 1982, members of Alcas management purchased the firm in a management buyout, and in 1985 they acquired Vector Marketing,[4] originally an independent distributor of Cutco Cutlery founded in 1981.[5] In 2009, Alcas changed its name to Cutco Corporation, with Vector its domestic sales subsidiary.[3]

Business model

Vector Marketing uses a direct sales model and that builds its sales force through advertising via newspapers, word-of-mouth, posted advertisements, letters and various media on the internet.They recruit sales representatives from high schools and college campuses in the United States and Canada. Students are employed as independent contractors to sell Cutco products (mainly kitchen knives) to customers, typically their friends and family members, via one-on-one demonstrations.

Vector Marketing previously required sales representatives to make a refundable security deposit to procure a set of knives for demonstrations. However the practices have changed and representatives are no longer required to make a security deposit. They are loaned knives and can be given many others as prizes for their "Fast Start" sales achievements.[6][7][8] Students who work for Vector Marketing as independent contractors are not reimbursed for transportation expenses and other common business expenses while working, or for the time they spend at training sessions.[9][6]

Lawsuits

Vector Marketing has been sued several times. In 2003, a recruit who was successful in a lawsuit against Vector for failing to adhere to labor laws in New York, co-founded a group, Students Against Vector Exploitation (SAVE).[10] In 2008, Alicia Harris filed a federal class action lawsuit against Vector. Harris alleged that Vector violated California and federal labor law by failing to pay adequate wages and illegally coercing employees into patronizing the company.[11] The case, Harris v. Vector Marketing Corporation, is pending a final settlement approval for US$13 million before Judge Edward M. Chen.[12][13] Vector was sued in 1990 by the Arizona Attorney General.[5] Arizona and Vector agreed to a settlement that punctuated a series of state actions against Vector's Tucson manager that spanned seven years. Vector agreed not to misrepresent its compensation system as part of the settlement.[14] In 1994, Wisconsin ordered Vector to stop deceptive recruiting practices.[5]

References

  1. ↑ Moret, Darrin (September 6, 2013). "Did I Participate In A Pyramid Scheme?". Popular Science. Retrieved May 31, 2017.
  2. ↑ Behm, Carly (October 19, 2016). "Students Question Company's On-Campus Recruiting". Loyola Phoenix. Retrieved May 31, 2017.
  3. 1 2 Shaw, Jeff (December 20, 2008). "Alcas changing its name to Cutco". Olean Times Herald. Retrieved May 26, 2018.
  4. ↑ Smul, Jack (6 December 2016). "Cutco: Schemers or Success Story?". Dartmouth Business Journal.
  5. 1 2 3 Robbins, Rebecca (August 2, 2011). "The Company that Cuts Both Ways". Santa Barbara Independent. Retrieved August 2, 2011.
  6. 1 2
  7. ↑
  8. ↑ Anderson, Matt (October 6, 2004). "Vector policies questionable". MTSU Sidelines. p. 1. Retrieved June 5, 2008.
  9. ↑
  10. ↑ Gripenstraw, Kelsey (April 20, 2011). "Beware of Campus Scams". The Bottom Line. University of California, Santa Barbara. Retrieved May 18, 2011.
  11. ↑ Chen, Edward M. (September 4, 2009). "Order Granting in Part and Denying in Part Defendant's Motion for Summary Judgment". Harris v. Vector Marketing Corporation. United States District Court for the Northern District of California
  12. ↑ "Court opinion". Harris v. Vector Marketing Corporation. Justia.com. May 5, 2011. Retrieved May 14, 2011.
  13. ↑ "Preliminary approval of $13 million settlement granted despite concerns". AllBusiness.com. May 31, 2011. Retrieved Feb 5, 2012.
  14. ↑ McKay, Peter (1996-07-01). "For Vector Marketing, The Question of the Hour". Washington Post. ISSN 0190-8286. Retrieved 2018-05-26.
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