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.


Anonymous said...

Not trus again Joe. I told you the story of an elderly couple that had been full time in the business for more than 20 years, that simply sell enough laundry detergent to maintain a Q12 business to this day. Since Amway increased the Q12 bonus to 20k last year, they make around 100K a year. They do not participate in any organized system.

You are right that the majority of people that spend their $200 to get an IBO number, have never run a regular brick and mortor business, but Amway is a business that, when taught properly, can be run and built very economically.

I have run a conventional store front business in the past. I was opened for 5 years. My Monthly rent was $3000, my electric was $700+, my payroll for 3 employees was about 1000 a week and then there was insurance, water, taxes, equipment repair and advertising, etc....

I worked 60-70 hours a week and at the end of the week, my take home pay was about $500.

When I looked at Quixtar / Amway, it was the 6th time I had been approached. It made much more sense to me at that point, than it ever had before.

What is more detrimental to new IBO's is that they do not know how to biuld a network.

Amway gets a lot less of those funny looks today than ever before, because people are running out of options and are feeling less confident than ever before about their economic future.

I'll post a follow up article from MSNBC right after this post.

Anonymous said...

Times have changed

NEW YORK -- Molly Stach thought she was doing everything right until she got laid off from her public relations job in December. Since then, the 26-year-old has been struggling with self-doubt.

"Why don't they want to hire me?" she asked of the companies not responding to the resumes she sends out each week. "I went through four years of college, graduated. You get praised while you are working and then all the sudden you are not employable."

For 20-somethings who are losing their first or second jobs because of the recession, the economic downturn has been an especially bitter pill. Many of them have been raised to believe they can do anything and be anything, and are finding their high expectations dashed.

"Many were raised to believe that the world was their oyster," said Alexandra Robbins, author of "Conquering Your Quarterlife Crisis." "And in this kind of economy, that's just not the case."

The national unemployment rate for people ages 20 to 24 was 12.9 percent in February, up from 9 percent a year ago and higher than the overall unemployment rate of 8.1 percent, according to Bureau of Labor Statistics. For those ages 25 to 29, the rate -- not seasonally adjusted -- was 10.6 percent.

Getting laid off is a humbling experience for Gen Yers, many of whom have never experienced real financial hardship or big disappointment, said Nancy Molitor, a clinical psychologist in Wilmette, Ill. She said many of her young adult patients feel depressed, devastated and uneasy about their future.

"A lot of these kids grew up thinking they were going to be able to have it all," she said. "They feel frozen just when they should feel excited and hopeful about the future."

While 20-somethings don't generally have the responsibilities of older workers, getting laid off is in other ways a harder blow because they are still trying to figure out what to do with their lives and are "ardent about doing something meaningful for a living," Robbins said.

Craig Hengel, 27, of St. Cloud, Minn., was surprised to be let go from his job at a printing company.

"Losing my job is something I never thought about because I am educated, very hard working ... and have never had to deal with something like this," he said. "I don't really know what to do next and I'm not finding much answers."

In previous recessions, companies tended to let go of more senior workers because of their high salaries, said Andrew Sum, director of the Center for Labor Market Studies at Northeastern University. But he said younger workers are faring worse this time around as employers hold on to the workers who have knowledge, experience and better work habits.

A growing number of workers over age 60 have also been returning to the work force and capturing jobs that would have gone to young adults, he added.

Brianna D'Amico, 23, was the first to go at the high-end retail group where she landed a job in Washington, D.C. She had been there six months when the company restructured; everyone else had five or more years of experience.

"It really hurts to lose a job that you really like, that you were good at, that you were praised for being good at," said D'Amico, who is collecting unemployment. "For a while I felt so embarrassed I was laid off."

In some ways, growing up in a time of plenty has made it harder for 20-somethings to adjust because they have to learn new skills, such as budgeting, living frugally and staying out of debt, said Dr. Judith Orloff, author of "Emotional Freedom: Liberate Yourself From Negative Emotions and Transform Your Life."

Still, she added, many have a youthful outlook that there's plenty of time to fix things and get back on track.

Some are hitting up the bank of mom and dad, though mom and dad are experiencing their own financial struggles. Others are looking at the situation as an opportunity.

Joecool said...

Anonymous, so there's a story of a nice elderly couple who sells stuff. What percentage is that of the tens of millions of IBO who have tried this business?

"When taught properly, this business can be run econcomically."

You see anonymous, that is the entire issue and why I run this blog. The vast majority of IBOs are not taught to run their business properly. They are taught to ignore facts, buy more tools, submit to upline, etc etc etc.

That's why I started blogging. To inform potential recruits of what to watch for to avoid being scammed.

Joecool said...

OKay so I read the post about those young folks losing their jobs. How will their situation improve by purchasing overpriced household goods and purchasing cds that tell them the overpriced goods are a bargain?

Anonymous said...

Joe, I'm just one of those believers that if one can do it, it can be done. Call me funny like that, but when I sat in an open meeting, with zero pv and zero downline, I was not one of the people that asked, "yeah, but how many people make or what percentage?" I was one of those that said, tell me HOW it's done and let me figure out how to make it work"

To this day, I have never registered a friend that I had coming into the business. My point is always, if one can do it, other can also. You're seems to be that no one can or that those who do, have some special secret handshake that gives them the easy route.

As for the people that are losing their jobs, nothing that you asked in that paragraph will help them. The point was, I don't get many funny looks, and people are not as cocky as they have been, because they now realize they were sold a bill of goods that said, get an overpriced college degree, buy a lot of high priced text books (that professors get kick backs on. That wasn't in the enrollment sheet) and you will be on the road to success. They didn't tell you in college that it really wasn't a garuntee and that you probably won't be working in your chosen degree in a few years anyway.

Joecool said...

"If one can do it, then it can be done."

See, this is one of the recruiting hooks for Amway uplines. They want to show what is possible, not what is likely. It is also possible to win the powerball lottery, or start a software company that will rival Microsoft. There are many other and better ways to make extra money and many of those were discussed on my other blog.

"They didn't tell you in college that it really wasn't a garuntee and that you probably won't be working in your chosen degree in a few years anyway."

That's because college is promoted as an education and not a job. However, it is well documented that a college degree means you have a much better chance of making more income than someone without a degree. Comparing Amway to college is actually quite silly.

If a decent number of people actually made money in Amway, there would be no argument.

Now if a college only graduated 3 out of every thousand students, that would be a better comaprison to Amway.

Anonymous said...

Actually, the percentage is not that far off. You have to measure your comparison with the same scrutiny you do Amway. If you take all the numbers of people that have enrolled in college or secondary education, vs. the ones who actually graduate, You are probably pretty close.

Then break it down the same way you do Amway; "Yes but of all those that do graduate, how many graduate with a 3.5 or better. Out of all the people who enroll in college, how long does it take them to earn back, what they invested? How many are truely financially successful etc., etc., blah blah blah

By the way, address your comment about the recruiting hook. Is it not true, that if one can do it, it can be done? Is that made up? A couple of years ago, in Quixtar's achieve magazine, over 5000 names were listed as having attained the Platinum level in that phiscal year.

John said...

But joe how many college students go out and enter the career of their studying when they leave college?

If one can do it, then it can be done."

Thats not a hook, he stated it was his belief.

Joecool said...

Levi, college is not set up to teach you how to study. They are there to educate you. After your formal schooling is done, you can go out and find a career or business to work.

In Amway, your schooling mever ends and you pay tuition as long as you are in the business.

John said...

College is not set up to teach you how to study? No, but it is there to teach you how to do a certain carrer but does not garuntee you will be able to enter that carrer or even be successful.
So, why would authors like Donald trump and Robert kyosaki recommend starting in businesses such as the likes of Amway in order to get an understandig of Big time businesses at a low cost?
You bash Amway at all costs but have no alternative to our problems and how we can solve them in another way. I want to get my time back with my family and friends, I dont want to build someone elses dream at a JOB.

Joecool said...

No, college does not teach you how to do a career. You learn in college and you may or may not work in a related field. But college graduation demonstrates your ability to learn.

As far as I know, Donald Trump does not promote MLM and while Kiyosaki does, he has not achieved anything in MLM, except to sell his books to MLM downlines.

Anonymous said...

Trump just bought his second MLM..FYI...Joecool, you say that upline tells you what is possible not what is likely. Social security statistics prove that you are more likely to be dead or below the poverty line if you just work a job your whole life. At age 65 out of 100 people only one has the ability to enjoy THE SAME lifestyle as they had before why don't we tell everyone that? Isn't that more likely? but it is still possible to make it...1% is good right?

Joecool said...

Anonymous, there is a difference between owning an MLM and being an IBO. The Amway owners are very wealthy. The vast majority of IBOs are not.

Can you back up your claim about only 1 in a 100 people can enjoy the same lifestyle they had before retirement? I don't think so.

Plus, most people do not need the same incone to match their working lifestyle. That is because when you retire, many people have their homes paid off, and retirement means less expenses as they do not need as much gas to go to work, and they do not need as many new clothes, etc.

Please don't make up such absurd claims. It makes IBOs look bad.

Anonymous said...

As Usual:

IBOFB twisting the facts.

Anonymous said...

Is there a difference...Do you know that the owners of Amway are IBOs??? Crazy huh? In an MLM company the way to best structure your company is to have a parent company Alticor, and then to be an IBO in your actual company, they are still IBOs.

I can back that up but I am having trouble finding my notes on it, I just sent an Ibocs I will let you know as soon as I hear back.

You say don't make absurd but then you say
"Plus, most people do not need the same incone to match their working lifestyle. That is because when you retire, many people have their homes paid off, and retirement means less expenses as they do not need as much gas to go to work, and they do not need as many new clothes, etc."

According to Fannie Mae 97% of people still have mortgages when they retire, that is why you will see so many reverse mortgage companies rise up. Less expenses? Have you ever watched the news? Seniors can't even afford healthcare cost, thier 401Ks are way down and they are stuck because if they get a part time job they might go above the income threshold and lose thier SSI.

I made no absurd comment, I can't believe you think people pay off thier mortgage...hello the savings rate is negative!

Joecool said...

"According to Fannie Mae 97% of people still have mortgages when they retire"

Can you provide a soucre for this?

And can you explain how joining Amway would make this better when most people lose money in Amway?

Anonymous said...

Joecool why is it that people have to provide you with sources for everything? Can't look them up yourself? Are you lazy? Or do you think that once you found them it will make you look and feel like an idiot?

Joecool said...

Anonymous, it is because many Amway supporters make ridiculous claims suchas 98% of people are broke by age 65 or 95% of businesses fail in the first year. These claims are not true, thus I ask for the source. I post many sources when I refute claims. Why do you and others make claims without verifying them? Are you lazy or are you just a liar?

Gina said...

Ah yes the reliablitity of Fannie Mae. Did you invest with Bernie Madoff as well?

So of that 97% who are retired what were their ages? What portion did they still owe on their home? How many years left?

People usually have to provide the proof for their own sstatements because they are the ones making them...lets recal our basic research paper writting...always provide proof. But I went ahead and did a search as you so kindly suggested and this is what I found..."in fact, according to
a 2006 survey by the Pew Research Center, 72 percent
of people aged 65 and older have no home mortgage;
this figure contrasts with the percentage — 32 percent
— of all homeowners who do not have a mortgage
on their home."

This was found from information regarding reverse mortgages...seems to not correlate with your odd stats.

I have yet to find your stats anywhere much less by Fannie Mae...

Oh and so since when are the owners of Amway IBO's? Does DeVos and Vanandel know this? They may not have gotten the memo. So when it is convienent for you IBO's its all about being independant but when it is more convinient it is we are the owners of Amway....can't have it both ways. Even according to Amway you are nothing but independant reps....owners of a company are not issued 1099's by the company they supposedly own.

John said...

Oh Gina..., prove it. are you a fraud or not? post your P/L and let us see if you are a fruad or not. Also supply us with proof that you are saving money at this venture of yours by supplying us with proof that your savings account is increasing by paymets your venture is able to provide you after your cost of living expeses

Anonymous said...

"owners of a company are not issued 1099's by the company they supposedly own."

sarcasm on:

But, but, but - interactive distribution! franchising! IBO-ship is like owning a McDonald's! You have heard of McDonald's haven't you????


sarcasm off:

I wonder how many IBOs actually receive a 1099 much less know what one looks like....

Bet they know how to report a loss on their Schedule C, though!!!!!

Anonymous said...

Looks like "Mr. EDC" disappeared quickly....

BTW, I was a triple-flipple-dipple Diamond with 4 people in my downline.....

Gina said...

so you think that I am a fraud as you are? I have shown my P/L in response to claims like yours by so many other IBO's before...and STILL no IBO can make with the P/L. Claiming that someone is a fraud in an attempt to deflect the real issue that you in fact are one and in a lame attempt to take away from their very valid point regarding business book keeping is silly.

Anonymous said...

Gina said:"Ah yes the reliablitity of Fannie Mae. Did you invest with Bernie Madoff as well?

So of that 97% who are retired what were their ages? What portion did they still owe on their home? How many years left?

People usually have to provide the proof for their own sstatements because they are the ones making them...lets recal our basic research paper writting...always provide proof. "

First off Gina to know what portion they owe on thier home and years left is impossible to track. I never said they were a good orginization I was reffering to them as one of the major sources of information on mortgages. The age was 65 and it is a fact that 97% of people have a mortgage at retirement age. It was in an article used during a House of Reps debate on C-span. i have had a lot of trouble finding it since I heard it. Fannie Mae is only one insurer of mortgages there are several others. Maybe you should do some more research.

Why do you feel the need to talk down to Levi calling him "poor little Levi"? Does that make you feel better. I bet your husbands company that he works for has done business with Amway, where does he work?

Levi: Keep going man...critics never stop. a friend of mine, his last name is Duncan, just went Crown. In his speach he talked about his struggle and how people laughed and laughed and laughed...but they are not laughing any more. Good job I admire your persistance on this site. Ask your upline but I think it would be more beneficial for you to focus on talking to new people instead of these guys/gals who are just plain negative.

Anonymous said...

hmmm. typical ambot rifraff...