Friday, June 5, 2009

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.

12 comments:

Levi said...

You obviously either have a really good job or live with mom and dad having no bills in order to do the scenario you are presenting. I know of no one who can do the scenario you are presenting when they first look at this business model otherwise why would they get in? if you can produce that much to pay out then you already have a decent income and why would you be scearching for more? Yes, It is true and sad at the same time, There are some uplines who sell that crap and they bring in alot of misguided souls looking for that easy out or that get rich quick scheme. But on the other had uplines such as myself teach a profit before expenses stratagy where most of people fall into. I meet people everyday who might have an extra 100-200 per month to venture out into a business but even then that is not near enough to do what you had to do. You were scammed plain and simple they took your money like candy from a baby. So now you are angry and are making sure your voice is heard and I can understand. I don't like this fact of what happend to you just as much as you. but you were foolish, if you narrow it down to the real cause of the problem is you had no spine. you should have known when you were spending an insane amount of money and bringing in so little you should have said no.
but you were sold over and over, this is not our fault but sadly only yours. Maybe the next time you take on a business venture or someone elses advice on a investment idea you might weigh your abilities and lead in a situation and not follow so foolishly the wild words of a fast talker.

Levi said...

Well I see you wont put my comment in whats up with that

Joecool said...

Levi, I moderate comments so idiots like tex don't ruin my blog.

And yes, I have a decent job, I own my home and I am very comfortable. I believe many who join Amway are not quite where they want to be in life and get attracted to what seems like an easy opportunity.

Levi, if you carefull read my posts, many are not aimed at Amway, but at the groups who sell the cds and seminar tickets.

Levi said...

Then Aim those people at still builing thier dreams with this business but get them away from the clutches of uplines such as the ones you had. you could be truely helping those people who regardless of what happened to you still have hopes and dreams of making this opportunity work. save them don't break thier spirit.

and i understand the whole tex and dave situation so I do apologize I should have gave you a bit more time.

Joecool said...

I do my best to point out pitfalls that IBOs can avoid. The sad part is that many who are "building" their business are at the same time, getting scammed out of their money by the same kinds of uplines I had.

Levi said...

Then we should be posting blogs to divert or stop people from joing and starting this way. the ones who are in it already may be too attached to their upline to break away from the tit. I have a blog on my site dedicated to you and your tribulaions with such uplines and would like to hear from you. We could change the garbage that has tarnished buisness opportunities and give people a correct way to raise thier chances to become sucessful and show the naysayers that this kind of opportunity can be done with honesty and integrity.

mrmaximum said...

"you could be truely helping those people who regardless of what happened to you still have hopes and dreams of making this opportunity work. save them don't break thier spirit."

But how is Joe is not saving them? By pointing out the issues with some of the other shadier AMO's which taught him suspect practices and caused his business to flounder in the first place. He is telling IBO's and prospects to watch out for it, if you come across a group who doesn't engage in these practices then what is the issue? How is he breaking the spirit of somone with a dream by warning some about how some will use it as leverage against them?

You said that he should aim his blog at the perpetrators of the issues of Amway, that is exactly what he is doing. He isn't stealing the dream of those IBO's who have enrolled in a suspect LOA (let's be honest, most are), he is saving them from a horrible nightmare.

Gina said...

Knowledge is power....The truth is key...

Reading the truth and gaining knowledge is not going to break anyones spirit. These are fundamental to building a business. How can someone avoid these pitfalls if they are not allowed to read about them or told soem propaganda excuse as to why there are people with these views.

There are none so blind as those who refuse to see...

Levi said...

But if nothing is said to encourage positive growth then they will drown in the negative. on my site you can see i dont' agree with all the practices of people in this business but I do also give a honest and productive alternative. These anno's that blog are skeptical to me because they don't reveal thier name for fear of what? If you run a honest business why should you hide in the dark?

Gina said...

There is a difference in something and nothing and always...in Amway motivation is always, positive is always, reality is never, negative is never...not a way to run a business at all.

No good with out bad, no positive without negative, no up without down..

There is truth to the statement that too much of a good thing can be a bad thing.

Levi said...

Lets go ahead and call that over my head.

my point is if you keep throwing negative comments and crticisim at a situation how do you think it will turn out?
There is positive to be said about this business and someone of your calibur should be able to find it. you could be guiding These bloggers to being productive in whatever business they do by giving the correct methods of how to oprate. for instance your P/L report, instead of saying ha ha show me,you could actually be teaching them how to keep one and why they should. you could make some of them more productive at what they are already desiring to do. But You Dont. That is my main reson for calling you a snob, you talk about your 4 mil a year business and how you are doing but you put down someone else who is trying just as hard.

Gina said...

"my point is if you keep throwing negative comments and crticisim at a situation how do you think it will turn out?"

That enterily depends on how you react to that negative. If there is constant negative it is because there is not enough positive, so evaluating the negative and making the appropriate changes should facilitate in a better balance between the two. The problem is that you like so many other IBO's is that you refuse to evaluate the negatives, you refuse to believe there could be so much negative and you don't have the gumption to face it and change it so instead you insult...


"There is positive to be said about this business and someone of your calibur should be able to find it."

Its not a matter of "should" find it. It should be clear. There are reasons one gets into business...Amway doesn't seem to provide for any of those reasons.

"you could be guiding These bloggers to being productive in whatever business they do by giving the correct methods of how to oprate."

I could do a lot of things. I could sit down and try to make a car that runs on water, I could try to solve world hunger....could could could....but why would I? No IBO wants to be guided from a real business person....especially when it conflicts with what the almighty upline says, so why waste my time? The information I give about expenses, P/L's, B/S's and basic business practices are everywhere on the internet....people are responsable for their own actions and choices....if they ignore it, they use it, they hate it, they love it...its all up to them...not me.

"for instance your P/L report, instead of saying ha ha show me,you could actually be teaching them how to keep one and why they should."

I have given plenty of information on how to keep a P/L. I have given titles of simple, inexpensive books that can be purchased everywhere, I have provided links to more information on how to calculate COGS, I have explained the fundamentals and do and can always provide resources proving their effectivness. You are just attempting to turn the tables and make it seem that I am only making empty statements without susbstance or backing them up....but you are wrong.

"you could make some of them more productive at what they are already desiring to do."

See both responses above....not my responsability, and I prefer to teach those willing to learn.

"But You Dont. That is my main reson for calling you a snob,"

No, your main reason is because just like every other IBO you are unable to provide facts or proof to support your stance so you resort to name calling.

"you talk about your 4 mil a year business and how you are doing but you put down someone else who is trying just as hard."

No I don't....your jealosy has you to believe that I do. And no....IBO's don't try just as hard as I do or have....if they did they would keep P/L's, B/S's ect. There are probably a very miniscule amount of IBO's who actually run their business as a business adn are honest and upfront with customers and prospects....but it is miniscule at best and those that are encountered online, like yourself, are not of that category and I take issue with people who are dis-honest, purport to be experts on subjects they know nothing of, who spout propaganda lies, name call, throw bible verses as responses of how they work for God, lie, cheat, steal ect.

June 11, 2009 9:21 PM