Tuesday, June 30, 2009

Amway - Are Diamonds "Free" As They Claim?

When I was an IBO, I often saw my upline diamond driving around town dressed in a business suit. I used to think why does he keep working if he can walk away and collect residual income? My sponsor told me that the diamond only works because he cares about his downline and wants to help them. So there are two possible scenarios, the diamond is working to help his downline out of a genuine concern, or possoibly he is working because he has to! The only difference now is that the diamond works the nite and/or graveyard shift, because many IBOs are building the business after the complete their day jobs.

Now Amway has stated that the average diamond earns about $147,000 a year. That is a decent income, but after yaxes and paying for basic expenses such as medical and dental insurance, the average diamond probably lives a very middle class lifestyle. Keep in mind that a large portion of a diamond's income comes in the form of an annual bonus, thus a diamond's monthly income may be quite small. Yes, diamonds may have other sources of income such as speaking engagements and income from standing orders and functions. But this income depends on the diamond's continued appearances and efforts.

So is it likely that a diamond is "free"? I would have to conclude that a diamond is not free, and may actually have to spend more time maintaining his group than if the diamond simply had a 9-5 job. For one thing, a diamond needs to maintain a personal group to keep qualifying for bonuses. With a poor retention rate in Amway, I am fairly sure that a diamond spends much time recruiting personally sponsored IBOs to maintain this group. Additionally, a diamond must help his six or more groups of downline platinums to maintain their businesses or face the possibility of falling out of qualification. My former diamond dropped down to the emerald level but has since re-qualified at diamond. A diamond must also dedicate time to reward up and coming movers and shakers, to keep them motivated. I got to spend time with my upline diamond when I was considered a promising up and coming pin.

In order to continue to receive tools income, a diamond must also travel to numerous functions and speaking engagements. Although the tools income allegedly doubles a diamond's income, it also adds a lot of expenses, especially if the diamond and his family travel first class to show off the diamond lifestyle.

After breaking down projected income and considering projected expenses, I can only conclude that a diamond probably lives a middle to upper middle class lifestyle, and probably works as much as a man with a 9-5 job, except that a diamond works nites and weekends. A good portrait of this is shown in Ruth Carter's book (Amway Motivational Organizations: Behind The Smoke and Mirrors). In the book, the diamond had a net income of over $300,000, but lived in debt, could barely pay his mortgage, and was always on the run from one function to the next.

Is this the freedom you are seeking?

Monday, June 29, 2009

Amway or College?

Many IBOs justify their involvement in the system of cds, tapes, books and seminars by comparing it to college. They claim they need this education and that it is much cheaper when compared to a college or university. Of course this is the upline propaganda that IBOs are fed, much like the concept that a job is a bad idea.

In college, it is true that not everyone graduates, but approximately half of those who start college end up graduation. Those who do not graduate still benefit from their education on a year to year ot course by course basis. When you are job seeking, a college degree will give you more options than those who don't educate. This claim cannot be made by Amway IBOs. The education an IBO receives by seminars and cds do not even equate to success in Amway, much less in other venues in life. Only a small fraction of IBOs ever reach platinum, which supposedly is the break even point. So as an IBO, you have less than one half of a one percent chance to break even as compared to approximately a 50% chance of graduating college.

Also, once you graduate and receive your degree/diploma, it is complete. In Amway, there are many many many examples of people who reached levels as high as diamond or above who could not maintain the level. There are also many examlpes of diamonds who quit Amway. If there were such a thing as "residual" income, why would anyone quit when they could sit back and watch the cash roll in. I think the answer is quite obvious.

There is also no evidence (as far as I know) that your Amway related education of cds and seminars actually work. The tiny fraction of 1% of successful IBOs is not a good case for arguing the success of the system. Colleges on the other hand, had accreditation standards, which is nothing like the ineffective Amway accreditation of groups such as BWW, WWDB or Network 21.

The fact that IBOs even dare to compare a college education to their teaching in Amway is a joke. Try telling a prospective employer about your Amway education and see what that gets you. LOL

Friday, June 26, 2009

Amway - IBOs Don't Know How To Build A Business?

Building a business. That's what many IBOs set out to do, except they don't know how to build a business, and based on IBO behavior and the things they say and do, it makes me wonder what their upline actually knows about building a business.

When you open a store or a restaurant, you may not make a lot of money intitially because not enough customers know about your store and you have not yet built a reputation. New customers who have a good experience are likely to return for more, and they are also likely to tell others about your store. Over time, you create a customer base and your weekly sales become consistent and somewhat predictable.

In the Amway business, many IBOs have no idea about building a business. They are shown great (apparent) wealth by upline, and then told that their business activity consists of showing the plan, listening to standing order and attending functions. Most of an IBO's activity, as prescribed by upline, costs money instead of generating sales. Some uplines do teach IBOs to sell items, but more often than not, it is not taught as a priority, and Amway's own admission confirms that.

What's more, as I said, a new business will get repeat customers when a customer has a good experience. What do you suppose happens when IBOs lie or trick people into attending Amway meetings, or deceive people about their business, or make up wild stories about perfect water? What happens when you embellish the truth about success and then cannot provide an answer when a recruit asks and IBO how they are doing in the Amway business? What happens when an IBO tells a potential recruit that he or she is a loser or stupid for not joining Amway? Would you return to a store if they called you stupid as you were leaving? What if you were called a loser?

These are the reasons why IBOs in general cannot get enough customers to sustain a consistent and predictable amount of sales, and why over the years, Amway has at best a spotty reputation. Just the mention of the name Amway and you may get funny looks from people. It is why certain internet zealots promoting Amway do more harm than good.

Wednesday, June 24, 2009

Amway - Why IBOs Struggle With Moving Volume - They Can't Sponsor Enough Downline!

When I was an IBO, I often found myself buying more goods than I needed because a single person simply has no use for 100 PV worth of Amway goods on a consistent month to month basis, save for eating double x for breakfast or something. In general, Amway's prices are higher than many retailers, because the cost of the IBO bonus is built into the price of their goods. Up to 34% additional markup is needed for Amway to cover all of the IBO bonuses paid to layers upon layers of upline and downline.

Because of this "disadvantage" that IBOs have, it is a very rare IBO that is able to sell enough goods to make an income. Amway admits that only about 4% of their goods are sold to non IBOs. This supports my claim about the prices. Because of this disadvantage, the only other way an IBO can build PV volume is to sponsor downline who will hopefully consume their 100 PV or more.

Then comes the next problem for IBOs. Sponsoring. To begin with, most IBOs are unable to sponsor others. This is where many IBOs have become their own worst enemy. I was once tricked into attending an Amway meeting, and many many others have left comments on blogs expressing the same experiences. Other were outright lied to about the business or were deceived. These practices, while not employed by all IBOs, have saturated North America. It is hard ti find someone in the US who has not experienced, or knew of someone who had a bad experience with an Amway IBO. Because of how some groups operate, there are also allegations of cult-like behavior, and some groups greatly exaggerate the amount of upfront cash needed to register. I understand that signing up to be an IBO can be less than $100 but some groups charge $200 or more, and I saw a prospect who said a network 21 group charged over $600 to register in Amway.

You add in all these factors such as high prices and a spotty reputation and it's easy to see why IBOs cannot move volume and cannot sponsor downline. New IBOs are almost assured of this fate when they register. It is only a rare few who can overcome these major handicaps. And even those who "make it" are often unable to retain their levels for very long. Is this truly a way to generate "residual" income? I think not.

Monday, June 22, 2009

Amway - What's Wrong With A Job?

One of the things that IBO leaders do quite often in their recruitment pitch for Amway, is to put down people's jobs. They criticize people's bosses and the fact that an employee needs to report somewhere to earn a living. They try to paint the picture of a job being compared to slavery. They do this apparently to make people feel uncomfortable with their present situation so they will be open to looking at the Amway opportunity as a means to make a living.

So I will ask - What's wrong with a job? A job is not slavery. People apply for their jobs and they agree to a wage or salary in exchange for their services. Certainly, you can leverage a higher wage or salary if you have an education or a skill, such as being able to work in the construction field. A job ususally offers more than just a wage. A job often allows one to have benefits such as medical insurance, a 401K retirement plan, and some other benefits such as vacation and/or sick leave.

A recent site visitor bemoans concept of working for minimum wage, where a husband and wife would earn in the neighborhood of 30K if they both work full time at minimum wage. Of course, a high school student can earn minimum wage so two adult only able to generate that kind of income makes me think my site visitor is speaking of people with very little to offer an employer. Most people may start out as entry level, but earn more and more as they gain experience and can offer more to their employer.

What does the average Amway business owner experience? $115 a month income (which is probably way above average)? Most IBOs as outlined in "the plan" earn about $9 a month and may have expenses such as standing order which will take away from that tiny profit. Thus an average business building IBO stands to net a loss. It is very easy to look at the math and make that conclusion.

So I ask again. What's wrong with a job? You have a net gain each and every month, be able to pay for your living expenses, and allow you to contribute to society by paying taxes. The average CORE IBO is a drain on the US tax paying society by spening money on standing order and functions and then deducting these expenses when filing their taxes. The only beneficiary is the upline leaders who sell standing orders and function tickets. So what's wrong with a J-O-B?

Friday, June 19, 2009

Amway - How Many Tools Do You Need?

There has been much debate over tools on this blog recently. IBOs contend that they need tools to build their businesses. Some uplines compare tools to the same tools that a carpenter or a mechanic uses. It just so happens that a friend of mine is a mechanic. He attended automotive technology college for about 18 months and occasionally goes to workshops to update himself on the technology used on newer cars, which his employer pays for.

After finishing school, he bought a decent set up tools. He occasionally upgrades some of his equipment. Some of these upgrades are also paid for by his employer. But the majority of his time is spent fixing cars, earning a living for himself and his employer.

The Amway opportunity consists of buying goods, selling goods, and recruiting others into the system. Not the most complex of activities if you break it down to its simplest form. But IBOs seem to think they need an endless supply of tools to build this business. They do not.

IBOs need to stop and think about this for a minute. An IBO only makes money if they sell a product for a profit, or if they sponsor enough downline who actually move enough volume to make a difference. Thus, if an IBO is spending say $100 to $150 a month on cds, books, seminars and voicemail, what return are you getting on this investment in tools? A mechanic or carpenter puts out an investment in tools, but they make up that investment and then some within a month or two. Anything they earn after that is how they earn a living. Most IBOs never recoup their first month's investment in tools, let alone enjoy a net profit.

Stop and think about it. When was the last time a book, cd, voicemail or a function led directly to a product sale or to the sponsoring of downline? And even if you did get a sale or a downline due to one of the tools, was it enough to make it worth buying all those tools? I would guess that for most people, it is not worth it.

Also, if the tools were so valuable, taught you success principles and the like, why do former IBOs sell them for pennies on the dollar when they quit Amway? Why don't IBOs continue to use these tools when they leave the business? I believe IBOs only use these tools because they have been told that the tools will lead to their success. Unfortunately and sadly, for the vast majority of IBOs who use tools, the tools only lead to a lighter bank account.

Wednesday, June 17, 2009

Amway - IBOs - CORE - Non Income Producing Activity?

One of the things touted by many upline leaders as the "key to success" is CORE. I have outlined the elements of CORE here:

1 - Show the Plan
2 - Retail the Products
3 - Tapes/cds
4 - Books
5- Functions
6 - Accountability
7 - Counsel with Upline (Be teachable!)
8 - Buy 100% of your own products
9 – Communikate

In these nine steps, only #2 may actually net the IBO a profit, but this steps is not emphasized in many groups. In all the other core steps, you either spend time and/or money doing things that do not produce income for your business. If you, as an IBO spend most of your time in non income producing activities, guess what? You will suffer losses. It is no wonder nearly all IBOs lose money, they are taught to spend most of their time in activities that do not produce income!

Imagine owning a brick and mortar store where you open the store for one hour a day. The rest of the day you are reading books, listening to tapes/cds, and paying to attend seminars and listening to voicemail messages. Oh, and in addition to opening your store for an hour a day, you don't advertise except for word of mouth. Could you survive in business? I think not. Amway now advertises, but you are not Amway, you are an independent business.

So can an IBO make money by spending most of his/her time in non income producing activity? I think not.

Tuesday, June 16, 2009

Amway - Why Most IBOs Fail

Most IBOs fail. That is not a wild guess. That is a fact. Amway supporters will argue that many IBOs do little or nothing, and while that might be true, even the remaining IBOs who work hard, still find little or no success. The system is set up that way. If you see a diamond "walking the beaches" as the cash rolls in, that means someone is putting forth the effort to make that happen. It is the downline IBOs who purchase Amway products and tools that allow these diamonds to enjoy what they portray as success.

We also know that some diamonds overhype their success. There has been evidence that the diamond lifestyle is often not what people think it is. If you could truly earn residual income by the bucketload, why do diamonds quit, resign, lose homes in foreclosure proceedings, and even wind up in bankruptcy court? One could argue that some diamonds are failures. The diamond lifestyle is an illusion created by upline leaders as a means to entice recruits.

Many Amway zealots and apologists try to make ridiculous claims comparing a company owner to a diamond. The big difference is that a company owner has employees who get a regular paycheck. These employees generally wanted the job and probably applied for the work. And if and when an employee leaves, there are other applicants who are willing to step in and do the work. Thus the business continues to meet their demands and continues to profit.

In the Amway opportunity, the IBOs spend money purchasing products, and then upline leaders expect these same folks to spend even more money to learn how to be motivated to do the Amway business. But in reality, if IBOs made profits, that would likely be sufficient motivation to run their businesses. Because it is hard to find enough (suckers) IBOs to join the business and fork out cash while they lose money, other IBOs have resorted to trickery, deception and outright lying at times, in order to attract potential downlines.

The 6-4-2 system ensures that the majority of business builders must "do the work" to uphold their platinum, who (probably) barely earns a net profit. And then you need 3 or 6 groups of IBOs losing money in order to maintain an emerald or diamond.
Amway has revealed that less than 4% of product moves to non IBOs. The absence of non IBO customers nearly guarantees that most IBO groups will lose money or make very little. Most IBOs are destined to fail. And it is not necessarily the IBO's fault. The system itself comes with many flaws which most IBOs cannot overcome, even for those who put forth much effort. It is why most IBOs fail. It is why I hope prospects will find and read this information before making a final decision to sign up or not.

Monday, June 15, 2009

Amway - Why Joecool's Blog?

I recently saw some disparaging comments about Joecool on another blog. I understand that the position I hold, is contrary to what many IBOs are taught, therefore uplines probably teach their downline that a critic is their enemy. I would like to take the time to clear up what my "mission" is.

Aside from what I see as higher than ordinary prices, I actually have little to complain about Amway the corporation. When I was an IBO, I found their customer services to be very satisfactory. My only other criticism of Amway itself is their inability or unwillingness to curb upline abuse of downline. There are plenty of testimony and verifiable issues which indicate that AMOs continue to abuse their downline financially.

The bigger problem lies in recruiting tactics of some AMOs. They lure in prospects by showing fabulous wealth. The wealth is supposedly attained by Amway income. The wealth is also probably promoted as easy to attain. Then when the prospect bites, the prospect is often taught that they must be on standing order and attending functions in order to succeed. These unsuspecting newbie IBOs then become dedicated "customers" of Amway and the AMOs. What is often excluded ot glossed over is that many upline might make a significant income from the sale of these tools, and that there is no bonafide evidence that standing order and functions actually work. One could argue that many who achieve diamond are on the "system", but in the same breath, you could also argue that eventually, someone wins the powerball lottery as well. This is not comparing a business to a game of chance, but drawing an analogy to your odds of succeeding.

Why is Joecool so against the AMOs? Because I have seen firsthand, and strongly suspect that abuses continue to this day. IBOs taught to sacrifice anything to buy more cds or function tickets. IBOs told to quit their jobs to attend a function, IBOs taught to skip making rent or mortgage payments to attend a function. I know of two former crossline who followed upline advice into home foreclosure or bankruptcy. There is evidence that this continues to this day. Sadly, there are far more IBOs who suffer debt and massive financial losses than those who achieve platinum or higher. The AMOs succeed on the backs of their downline while making the downline think that losing money is success.

Friday, June 12, 2009

Amway - More On "Buy From Yourself"

At a recent church function I attended, some of the members were selling food as a means to raise funds to go on a mission to China. They were selling lunch and it gave me an interesting but very real analogy to explain why the "buy from yourself" method as taught by upline is just ridiculous if that is your primary means of moving products from your business to the end consumer.

At my church, these folks were selling chili dogs for $5. It probably costed about $2 to buy and prepare these chili dogs, thus each sale netted the mission group about $3. But to make a point, how much profit would be made towards the mission if only the missionaries bought chili dogs? Simple, their profit would be $3 times the number of chil dogs sold. But there is no true profit as the money is still coming out of the pockets of the missionaries.

You could argue that it is still profit, but from a business standpoint, it is not a true profit. If I owned a retaurant and dined in my own restaurant, it doesn't increase my sales, nor does it increase my profit.

Buying everything from the Amway catalog (Or Amway partner stores) for yourself does nothing to increase your profit or sales. It makes you a customer. Any rebate you receive from buying your own goods, still comes out of your own pocket.

Now if you bought nothing but sold some Amway goods to people, you realize a true profit from a business perspective.

There is nothing wrong with buying what you truly need through your own distributorship, but if your upline is teaching you to buy from yourself without selling goods to non IBOs, you are being taught some poor business practices.

It is my guess that some upline leaders teach the buy from yourself method because YOUR loyalty and dedication to 100 PV brings stability to their business. Stop and digest this for a minute.

Wednesday, June 10, 2009

Amway - Buy From Yourself?

In a recent exchange with an Amway apologist, we debated the merits of buying from yourself. Here's the exchange:

Joecool: Nobody actually makes money buying from themselves. In what other business besides Amway do people teach business owners to buy from themselves almost exclusively?

Awesome!!! said...
Not true Joecool. If you own let's say a car factory making sports cars, you would turn to one awesome car your factory does make, maybe even custom made. So, you end up buying it from your own business. To me that just makes sense. Only to a blind man does that not make sense.


Joecool's commentary: It is apparent to me that IBOs like "Awesome" are compleetly fooled by upline teaching about "buy from yourself". If I owned a car factory and I bought a car from myself, I would make nothing. If it costs say $20,000 to make a sports car, and I purchase it from my own factory for my cost of $20,000, I made nothing. In fact you could say I took a loss because I still had to pay the factory workers to make the car.

While it may seem plausible to buy from your own store, that is not the key to the success of the business. The key to the success of a business is selling your goods and services to customers! A friend of mine used to own a franchise food business (not McDonald's) and frankly, he could not stand eating at his own retaurant. The only product from his restaurant that he consumed regularly was diet coke!

Folks, there is nothing wrong with supporting your business, but you will not be successful if you are the primary customer of your business. Do the math and it's easy to see. When you buy from your "IBO-Ship", the biggest beneficiary is Amway, who makes or sells the products. The only way to overcome this, is to sponsor enough downline who will do the work and suffer the losses on your behalf.

That's how Joecool sees it.

Tuesday, June 9, 2009

Amway - My Upline Has My Best Interest At Heart?

A shocking testimony!


I have a similar experience with Amway and my marriage. My dh was totally taken in....we had no job...no money.....and my doctor had us over to 'visit' and we spent over $100 to get a basic start-up kit! Plus, we still had to buy more motivational materials AND for the kicker....drum roll.....my doctor decided I needed to stop breastfeeding my then 10 month old baby so that dh and I could spend more time recruiting our down-line. That way baby could stay with a sitter (she ate every two hours around the clock). I did not want to do this. This was my third and last baby, and the only one I had successfully produced milk to feed. But dh was adamant that Amway was more important (even when I pointed out to him that we had already spent more money than we had and my parent were supporting us!), and he would NOT let me feed my baby again! Instead, my baby cried and cried, I cried and cried, and we had to sign up for WIC to get formula. Because of Amway. Sick.

And, dh made me listen to these motivational tapes every time we stepped in the car to go anywhere. They made me sick. Down right sick. The most important thing was making money and having more, more, more. And leaving your kids to make this money was necessary. Being content with where you were in life and being happy in your current job was NOT ok, and forGET being frugal: spend, spend, spend....especially to go to meetings, meetings, and more meetings to meet wonderful Christians that had wonderful money in our wonderful up-lines.

Sick. It was just.sick.

Doctor and dh told me I was going to make my dh fail. It would be all my fault because "I" wasn't "doing my part". Nope. Taking care of 3 small dc, the house, the cooking, the laundry, the bill-collectors, etc. while dh went to meetings instead of to job interviews.....that was failure as far as Amway was concerned. Because I didn't go with him. I didn't hire unknown sitters to stay with the kids. Sick.

Finally, I sat dh down and told him if Amway was his thing: fine by me. But I wasn't interested in a group of people that thought money was more important than their children and their families. If he wanted to pursue it; fine. He could do so without me. I would just stay home and hold down the fort. But I would no longer use their inferior products (dh made me purchase their disposable diapers which leaked like mad and cost twice as much). If he liked a product and wanted to use it: fine. But I was purchasing products that worked for me. (I also hated their shampoo/conditioner and laundry detergent and make-up)

I can not tell you how relieved he was when he finally admitted to me that I was right and he had been totally taken in by the 'life-style' that was constantly put in front of him by these people. He apologized for the breast-feeding thing that could NEVER be recaptured, he applied for real jobs, went to interviews, got hired, and we could finally pay our bills.

And, all those wonderful Christian friends he had met? We never saw or heard from a one of them again, and my doctor 'recommended' me to 'someone closer to where I lived'. Yeah, right. Sick.

I hate Amway.

Monday, June 8, 2009

Amway - High Prices?

In my opinion, one of the biggest challenges with being an IBO was trying to sell Amway products because overall, their prices were too high. Now this is not to say that every single product sold thru Amway is priced higher than retailers, but certainly, a price comparison with WalMart or Costco would show that Amway prices are indeed higher for the exact same or similar products.

Sure, there are some Amway zealots like IBOFightback who will try to justify paying up to 3 times more for products such as meadowbrook toilet paper versus Kirkland. But Kirkland is much much cheaper, if you buy it at Costco, and still cheaper even if you order online and have to pay for shipping. I even saw an 8 pack of progresso soups in an Amway catalog for $18.99 and the exact same 8 pack was sold at Costco for 11.99. IBOFightback and other Amway apologists can try to justify the prices all they want but these numbers don't lie, and Costco and WalMart sales back up my claim. IBOFightback has only rhetoric and other apologists to back his claims.

But maybe it will help if I offer why I believe that Amway, and apparently most other MLMs have to have higher prices. It is because they need to pay IBO bonuses.
If Amway had about a billion dollars in sales and gave back 343 million or so in bonuses a few years back, it means quite clearly, that Amway could have charged a customer 30-34% less without paying IBO bonuses. Thus $300 worth of Amway products could have been purchased at Walmart or Costco for about $200. (Same or similar products).

The problem for most IBOs is that Amway pays 34% in bonuses, but most IBOs get nothing or perhaps 3% while layers and layers of upline (middlemen) take their cut of that (approximate) 34%. IBOFightback himlself said on Qblog he was a (founder's) 3%. I assume that to mean that he does 100 PV every month.

So in Amway and most other MLM opportunities, you are handicapped with paying higher prices because of the IBO bonuses which are included in the price of the products. You as an IBO, compound that problem if you participate in a system of cds, voicemail, books and functions which teach you that this is a good opportunity.
It is also, in my opinion, the reason why only about 4% of Amway goods are sold to people who are not IBOs. IBOs are their own best customers because the rest of the US shops at Costco and WalMart.

Amway - IBOs are Slaves For Upline?

I remember when I was an IBO, it was common for certain "movers and shakers" to earn time with upline. For example, I remember one time when our group had some kind of contest where the winner got the incredible priviledge of driving our upline diamond to the airport. There were other types of qualifying contests as well, where the winner got to "win" some time with upline, even if that meant it would actually cost them time and money.

Thus, IBOs who already spend their hard earned money on products, to earn PV, and then spendmore money buying materials such as cds and function tickets, get the priviledge of driving the diamond to, or picking the diamond up at the airport.

I also remember certain IBOs winning the priviledge of getting to run product pick up for the diamond when he was out of town speaking at a function or something, It's almost like paying someone for the priviledge of doing a task for them.

At functions, the directs (platinums) worked the function as ushers. I'm not sure if they had to pay to attend these functions, but I am certain they they had to pay for travel to get to the function. Imagine having an unpaid employee who pays their own way to work in another city?

Basically, downline IBOs are like slaves. They serve and edify the upline diamonds, they open doors, chaufeur them around, give them gifts and other perks, all for the priviledge or spending a few minutes with them. In my book, that makes IBOs uncompensated slaves. At least slaves were fed and given housing. LOL

Friday, June 5, 2009

Amway - How Upline Sells You A Dream To Lure You Into Their Scheme

Dreams. One of the big recruiting tools used by upline is to sell you hopes of a dream. A "dream" is basically a long term goal, such as the dream of owning a home. It is why Amway leaders want their groups to show an aura of success. IBOs attend meetings in suits and nice clothing. They will flash picture of luxury items, supposedly attainable by "anyone".

Now of course, anyone have a dream or dreams is a good thing. It gives you a purpose, something you are working towards. The part that is unethical by many uplines is that they will basically make you empty or false promises. There are many ways to achieve your dreams. It is unlikely that an IBO will achieve their dreams by running a successful Amway business. Even at the diamond level, it appears that it's not as good as how they promote it. There have been many stories of diamond level IBOs quitting, losing homes to foreclosures, and even a recent story of a triple diamond in bankruptcy court.

How these upline leaders lure unsuspecting prospects is quite clever. They will often talk about how they were once broke, but through the Amway business, they now have no job, and they make TONS of money. They will also go onto tell prospects that they too, can have the same success in a few years, if only they will do what upline says (advises), and that the key to this is to subscribe to their "system".
The system is usually a website, voicemail, cds, seminars and books.

What upline leaders really want is for a prospect to become a dedicated "customer" of their system. There is plenty of evidence and testimony that some upline leaders might be making almost all of their money from the system. Sure, an IBO can rationalize that upline might make only a hundred or two hundred bucks a month from them, but add that times the number of downline IBOs and figure it out.

Sure, some upline may tell you that you can eventually get a piece of the action at the platinum level, but there are no written compensation plans for the "system" that I know of. And so few IBOs ever reach platinum, that your chances of getting a small piece of the action are slim. Upline leaders may tell you that they want your success, but it may or may not be true, as your success might mean less income for them. I believe many upline leaders are just as happy to see new people replace old people, as long as they continue to have dedicated "customers" to purchase their system materials.

The upline leaders want to use your dream to motivate you to buy into their (tools) scheme. That's how Joecool sees it.

Amway - How An IBO Can Lose Tons Of Money And Not Notice

When I was recruited into Amway, I was told that I could make money, which would roll in forever and ever. Residual income. That was the concept that appealed to me when I was recruited. I was also intrigued when I was told thaty I could do as much or as little as I wanted.

However, when I signed up, my sponsor told me that I would be wasting my time signing up to sell products (not verbatim). That if I was going to get involved, I may as well try to build an organization and make the big bucks. I consented and then he immediately told me that I needed to get on standing order. I was told that standing order was a tape subscription and it was only $6 a tape. Nobody ever mentioned that every other week, it was a two tape set.

After a week or two, I had registered a couple of my friends into the business and my sponsor tells me that I cannot be a leader without attending all of the functions, and that I cannot listen to the same tapes over and over. That's when my expenses shot up like crazy. Of course I was excited with the folks I had sponsored so I went along with the plan, and I was edified for it so it seemed like I was "being an emerging leader".

Amway defenders question how I could possibly spend an average of nearly $1000 in a month for tools. Here's the breakdown, and although my WWDB group experience may not apply to all, I certainly continue to hear similar stories of abuse.

Standing order $36 a month. (6 tapes a month @ $6 each)
5-7 extra tapes each week $$120 - $168 a month
Amvox $24 a month
Open Meeting $6 a month
Regional functions $24 a month
Subtotal: $258/month

Major functions (4 times a year) I live in Hawaii, and major functions required mainland travel at peak travel times (January, March, July, October).
Round trip airfare $700
Hotel: $240 (for 2-3 days)
Rental car: $150 - 50 per day for 2-3 days)
Function tickets $100
Meals and other misc expenses pushed a major function to over $1200 for each trip.

These costs, not including gas money, totals about $8000 a year. Add in the cost of products and you are spending about $1000 a month on Amway. Yes, the products are not really a business expense, but then again, how many of those over-priced products would you buy if you were not an IBO? Do any former IBOs still buy double x? Do IBOs actually sell any double x? I believe these customers are rare.

If your sponsor told you that Amway would cost you nearly $1000 a month (high end, including product) or $100 a month (low end, not including products), would you still join? Once you agree to register, the expenses are then slowly revealed to youand in many cases, called investments into your business. Be wary and ask tough questions as to whether these items help you to make a profit, or whether they take away your profit.

Thursday, June 4, 2009

Amway - Amway And The Better Business Bureau

An anonymous poster who resides in Scarbourough Ontario Canada, recently posted a link from the better business bureau which I have attached:

The link says Amway Global had an A+ rating. Congratulation to Amway Global. Certainly, even as a critic of the Amway opportunity, I can acknowledge that an A+ rating from the BBB is something to be proud of. However, even as a critic, I have said that my personal dealing with Amway customer service was always satisfactory or better. Here's what the BBB link says about their ratings: "BBB assigns grades from A to F with pluses and minuses. A+ is the highest grade and F is the lowest. The grade represents BBB’s degree of confidence that the business is operating in a trustworthy manner and will make a good faith effort to resolve any customer concerns" Thus Amway makes a good effort to manage and resolve customer complaints.

Many IBOs do not understand or are fed deception. The rating does not apply to your line of sponsorship. The rating does not say WWDB, Network 21 or BWW has an A+ rating from the BBB. Also, IBOs are not Amway! In IBO is an "independent business". Therefore, the BBB rating does not apply to IBOs.

It is this misuse of Amway's credibilty that deceptive upline leaders use to sell their system. It is why so many misinformed IBOs think that the BBB and the FTC endorse Amway. They do not endorse any business. They are regulatory agencies.

IBOs and Amway prospects, I challenge you to point out where the Better Business Bureau or the FTC says that the Amway opportunity is a good and profitable one.
God and search high and low, you won't find that information. You must remember that nobody here has Amway is illegal or provides poor customer service.

Joecool's contention is that the Amway Opportunity, in it's present form and as promoted by many LOS's, is a poor business opportunity for nearly all who register. Amway's average income, when disregarding "inactive IBOs", is $115 a month. If you can retire early on that income, then go for it.

Tuesday, June 2, 2009

Amway - Is Amway A Bait And Switch Scam For Upline?

Most Amway folks call themselves IBOs, or Independent Business Owners. If you are an IBO and are taught "Buy from yourself and teach others to do the same", you are basically a glorified customer of Amway. Amway "rewards" their IBOs by giving them a rebate, or a bonus based on the amount of volume that they move. IBOs are also able to "sponsor" others into their downline which would be counted towards their sponsor's overall volume. Also, in order for an IBO to reach various levels in the business such as "emerald" or "diamond", you need to sponsor other IBOs.

Because the emeral or diamond level is a goal for many, IBOs often focue their attention to sponsoring others. Some of these sponsoring or recruitment tactics have been unethical and has been the target of much criticism over the years.

But one of the biggest scam being pulled on IBOs is when they are recruited for the Amway opportunity, they shown people blowing up their alarm clocks (no job), fancy cars, residual income speeches, mansions and the like, all a part of the (diamond) lifestyle. Go diamond and you can have all of this.

Many recruits see what appears to be financial success while surrounded by a room full of people in suits, also "appearing successful". They are often told that attaining this is very likely - if you buy into the "system". The system consists of a website, voicemail, cds, books and seminars. Many IBOs do not notice that by consenting to participate in the system, they become dedicated "customers" of the system.

Now I have nothing against an IBO receiving some training on sales and how to run a business, but the system apparently does not teach these skills. There is also little or no evidence that the system actually works. My former LOA is WWDB. They proclaimed to be the best, most profitable and fastest growing when I was an IBO about 12 years ago. Since then I believe there have been more WWDB diamonds losing their homes to foreclosure or leaving Amway, then the amount of new diamonds emerging from the system.

The bait and switch scam is luring an innocent prospect to Amway, and then quietly converting that same prospect into a system participant. The prospect thinks he/she is assured of Amway success because of the system, but the vast majority of these recruits end up losing money or going broke/bankrupt - because of the system!

Monday, June 1, 2009

Amway - Big Talking IBOs, But No Substance

So many IBOs talk a good gameplan, but have nothing to back it up. A good example, is the self appointed Amway expert, IBOFightback. He sticks out his chest and acts like am Amway guru, but ask him what he has accompished in Amway and you will get some vague and probably BS answer such be being "at least a founder's 3%". In other words, he is probably a former 1000 PV pin, if even that.

Time after time, IBO after IBO comes and goes through these websites, talking big about success and how critics are broke, and losers, yet they disappear into thin air never to be heard from again. One of the big things IBOs talk about is duplication, but it appears that it is good in theory but not in practice. It's also easy to talk about finding customers but for many IBOs, their only "customers" are their downline, if they have any downline.

It's all common sense. How many customers are willing to pay $78 for multi vitamins when you can get a similar product for literally a fraction of the cost? Sure, Amway zealots like IBOFightback will argue quality, but as far as I know, there is zero unbiased evidence that double x is any better than the cheaper multi vitamins you can get elsewhere. Only a true Amway zealot like IBOfightback would actually argue the quality of toilet paper, but IBOfightback probably has never tried Kirkland toilet paper, which is a fraction of the cost of meadowbrook.

So IBOs, where is your substance? Are you making a profit after your expenses are considered? If you are profiting, can your downline make the same claim? Chances are they cannot. Can the biggest Amway defender show evidence that he profits? No, chances are he is just talk without substance. Of course he is welcome to provide such evidence, I would be glad to correct myself. *crickets chirping*