Monday, November 30, 2009

Amway - Is Amway Your Hobby?

Many Anway IBOs get into the business with high expectations. They get in with oftentimes, a dream of early retirement, living a fabulous lifestyle, mansions, sports cars and "walking the beaches. In order to do thism IBOs are taught that they need to "plug into the system". So IBOs get on standing order, they attend all the meetings and functions, they read books and show the plan.

But because the Amway business has so many handicaps and shortfalls, the IBO soon falls into the trap of "playing Amway". The IBO will do their 100 PV, either by self consumption or selling, or a combination of the two, and will continue to listen to the cds or tapes, and will continue to attend every meeting. When I was an IBO, our group had many who did not sponsor a single person, yet they were at all of the meetings and functions. These folks, in my opinion, had Amway as a hobby.

A hobby is something you do in your spare time, usually something you enjoy. For many people, Amway meetings are a social event. It is evidenced when some people say they enjoy the meetings, being with "positive people", and they have become nicer as a result of their involvement. While this may or may not be a side benefit of the functions and meetings, it is not relative to the bottom line of a business. A business exists to make money. If a business is losing money, expenses are usually cut.

If you have been an IBO for more than a month or two, have you actually sponsored someone? If the excitement of being a new IBO has not resulted in acquiring new downline, it is unlikely that you will ever have a downline. If you have been in the system reading books, listening to stnding order and attending functions and showing the plan, and you have no results, you have Amway as a hobby and not a business. Don't feel bad, sponsoring other IBOs is not a common or easy feat. But as a business owner, you should think about your involvement in the business and if you find you are participating in a hobby rather than running a profitable business, then you should decide whether or not you are accomplishing what you set out to do.

Are you running a business (to make money) or are you playing Amway?

Tuesday, November 24, 2009

Amway - Buy From Yourself?

One of the apparently common practices among major IBO groups is still the concept of "buy from yourself". I believe IBO leaders teach this because most people are not familiar or not comfortable selling goods and services. Therefore, to teach buy from yourself makes the business an easier sell. In reality, an Amway IBO is simply a comissioned salesperson with no benefits. But presenting the opportunity that way is unlikely to yield results either, thus the buy from yourself has become a common practice.

Buying from youself makes you a customer and not a business owner. Buying from yourself doesn't generate your business a profit. Would you open a car dealership to buy a car? Now I am not suggesting that supporting your own business is a bad idea. What I am suggesting is if you are the primary or exclusive customer of your Amway business, then you aren't really running a business. You are simply a glorified customer.

What an IBO is really doing is paying his upline's bonuses. Amway overcharges more than 30% of the cost of their product. They have to do this in order to be able to pay IBO bonuses. Since most IBOs are at 100 PV or less, the lion's share of the bonuses earned are channeled upline when a purchase is made. It is not a level playing field as some IBO leaders might suggest.

What compounds the situation and makes it worse is when an IBO pays for standing order or attends functions where some of these IBO leaders may teach this bad business practice. You as an IBO already pverpay for products for which upline gets most of the bonus, but then the problem is compounded by IBOs paying to receive this bad advice. When I was an IBO, I heard speakers talk about skipping rent or mortgage payments to attend more functions, or having your family skip a meal so you can buy standing orders. Buying from yourself is just another example of bad advice given fro upline to downline. What makes it worse is that some uplines profit by giving bad advice.

Are you buying from yourself almost exclusively? Can you think of any truly successful business where the owner is the main or possibly the only customer? I can't think of any.

Monday, November 23, 2009

Amway - The Facade Of A Diamond Lifestyle?

Have you ever been to the set of a movie? You may see a mansion for example, but often, in movies, it will be only the front of the mansion. When you see the full picture, you would note that there is no mansion, but simply the facade or the front camera shot of a mansion. I believe this is what many diamonds are doing.

Going diamond. While certainly it is not the goal of all IBOs, it certainly is what many IBOs are hoping for. Diamonds are often portrayed as having no job, waking up at noon every day and basically living a lifestyle full of luxury and leisure. At least that's what is being portrayed. I certainly though so when I was an IBO. But now I can easily see through the illusion.

The illusion is set up, I believe as a recruiting tool. Afterall, living a middle class lifestyle with a modest income wouldn't be all that attracive would it? A young couple might think $4000 or $5000 a month is a great income, but the reality is that you won't be traveling the world a sipping Martinis all day long, even with an above average diamond income.

Certainly there may be some tenured crown ambassador types who might make over a million dollars a year from Amway, but I do believe this is the exception and not the rule. I would suspect that most diamonds live average middle class lifestyles but simply provide the illusion of great wealth at functions or at recruitment meetings.

When you simply do the math, the diamond lifestyle doesn't add up. Think about taxes, medical insurance, private school for kids and other expenses. How much do you think you would need to earn to pay for these expenses and still be able to save some money? We are currently seeing bits and pieces of evidence that my claim may indeed be true. Diamonds with homes foreclosing, diamonds selling off homes, a significant diamond filing for bankruptcy.

The writing is on the wall. Most IBOs simply choose not to see it.

Friday, November 20, 2009

Amway - IBOs Living in Denial?

So many IBOs are hard working and dedicated to their business. However, I believe they are simply living in denial. Most of them, even the hardest working IBOs are more than likely losing money, due to the system expenses. The system generally consists of voicemail, standing order, book of the month, meetings and functions.

When I was an IBO, I was losing money or braking even at best, but I always spoke about my "gross" income and did not mention the mounting costs of the system. I did as my upline taught, you see. I just figured I was helping others who would eventually copy me and we would all progress towards financial freedom and walking the beaches of the world. However, in retrospect, I see that I was just fooling myself and living in denial.

I believe there are still many IBOs out there showing the plans and working the system only to end up month after month with a net loss. I am writing this article hoping that some IBO will see it and be able to relate to what I experienced. I jut wish someone had spoken some sense into me sooner. It's easy to get sucked into the system because you are normally sponsored by someone know know and trust. But your sponsor is more than likely "NOT" trying to rip you off, but simply teaching what upline teaches. It's upline, in my opinion whose greed has ruined the business opportunity with their self serving advice. I hope this article helps some IBOs.

Tuesday, November 17, 2009

Amway - The Real Cost of Tools?

To my knowledge, there is no unbiased evidence that the tools used by IBOs actually work. Sure, Amway apologists will argue that everyone who "succeeds" uses the tools, but these same apologists will disregard the tens or hundreds of thousands who also use the tools but do not succeed. But what many do not notice is the hidden costs of the tools. I'm not talking strictly money. The tools costs an IBO valuable time as well.

Attending seminars, meetings, listening to standing orders, checking voicemail all takes up valuable time from an IBO's life. Factor in the cost and most IBOs who use tools end up with less time and money. Ironically, many IBOs may have joined Amway to gain more time and money. That time and money is supposed to come in the form of "passive income", something that very very few IBOs enjoy. I suspect that even big tenured diamonds may not have all the time and money as they like to portray. If they did, wouldn't more of them have walked away from the business to go and enjoy life?

I challenge IBOs to sit down and analyze the financial cost as well as the time commitments they sacrifice to build the business and ask yourselves if it is truly worth the cost? If you are perfectly honest with yourselves, I think you may find that your time and money is not well spent. But you as a business owner must look at the big picture and come up with your own conclusion. It is my opinion that nearly all IBOs will find that the real cost of the tools far exceeds what little benefits you may enjoy from the tools.

Monday, November 2, 2009

Amway - IBOs Lose Money Because Of The Tools

What are tools? Tools in reference to the Amway business usually consists of Books, CDs, Voicemail, Wesbite Hosting, and Functions. While the prices of these individual items may not seem exorbitant, the collective cost for these tools can run up to several hundred dollars a month. For extremely hard core IBOs, these tools can cost more than $400 a month on average, and perhaps for a casual partaker of functions, etc., perhaps they can get by for less than $100 a montt on average.

But in any case, when most (business building) IBOs are at 100 PV or so, which results in a $10 bonus, it is easy to see how most IBOs will lose money because of the tools. Even at 1000 PV, it is likely that a dedicated IBO will have a net loss in their Amway business. It is simple math, add up the tool expenses for any group and then add up the bonuses. In nearly every group, there will be a net loss.

Of course, someone upline is profitng from tools, thus the success you see on a stage is likely coming directly from the pockets of their downline. Sadly, most of these downline will never earn a net profit but will be told to never quit and encouraged to continue to invest into a black hole that will never pay them back and will nearly assure business failure in the long run. It is also sad that so many downline will be told these lies about future success by people who they consider trusted friends and mentors.

I would strongly encourage IBOs to look critically at their business and add up the cost of your expenses and compare that with your income. If the income is not growing steadily, then you may want to reconsider additional expenditures for tools. That is real business. If upline encourages you to buy more tools when you are losing money, maybe you should wonder whose best interest is at heart in teh advice you are receiving.

Joecool will be on vacation in Europe and Japan over the next two weeks. I would like my audience to note that my J-O-B is paying for this wonderful vacation. If I end up in Sweden, maybe I will pay IBOfightback a visit. LOL I'll return to my blogging duties later im November. I wish everyone well.