Friday, February 26, 2010

Amway - Business Mentality?

One of the things IBOs "think" they possess, but in reality they are far from it, is "Business Mentality". It is not necessarily the fault of the IBOs. Many are sponsored into Amway by trusted friends or family lacking business experience. They will "submit" to upline as they are advised and will try to learn about the Amway business. The problem is that many upline leaders teach self serving business practices such as hard core dedication to their tools system, from which they often handsomely profit. Let's examine some of the questionable practices.

"Buy from yourself". If you have a business owner mentality, you only buy from yourself if it's beneficial to your business. Many IBOs talk about ridiculous things like a McDonald's owner would never eat at Burger King. That's totally false. Just because I own a McDonald's doesn't mean I am eating Big Macs the rest of my life. You cannot spend yourself to prosperity. If I sold pens for $1.00 and my cost was .50, and my competitor had a special on the same pens at 3 for $1.00, I'm buying them from my competition. Also, buying from yourself makes you a customer, not a business owner.

"Ignore facts if you have a dream". This is probably the biggest heap of bull crap taught by some upline. I have seen this spouted in particular by IBOs downline from WWDB and BWW leaders. A business owner studies the facts, not ignores them. Any REAL business owner wants to know how much he is bringing in and how much is going out. That's how you detect the heartbeat of your business. A site visitor named Gina on this site, posted a profit/loss statement from her real business. Naturally, IBOs were at a loss to discuss it because it was foreign material to them.

"Submit to upline" Another load of hogwash. Why should someone submit to upline simply because they "sponsored me" or whatever? A real business owner would think independently and make business decisions based on facts and numbers, not on the advice of someone upline who hasn't taken the time to assess each IBO on a personal level to be able to give advice on an IBO's "Indepdendent Business", or worse, advice on their personal lives".

"Dedication to the system". Silly advice as well. What dedication does the system have for an IBO? If an IBO succeeds (which is very rare), the system takes credit, but for the more than 99% of people who never make a significant income, it is their own fault if they don't make it. Amway apologists will defend this by saying that many may not have signed up wanting a significant income. While that may be partially true, tell me where people show "plans" designed for the guy who wants an extra $100 a month? The plans shown are always (AFAIK) to go platinum or diamond.

IBOs and information seekers, does any of this sound familiar? Is this a part of your experience? If so, I encourage you to ask questions here and get more information before proceeding with any more "business" activity.

Amway - Duplicate Your Way To Success?

One of the things my upline used to teach, and apparently is still taught today, it to duplicate or copy your way to success. In fact, we were told to always check upline because things we did needed to be duplicatable for your group. For example, flying first class to a function was not duplicatable, thus not allowed. I believe this is why some IBOs mistakenly think they are franchise owners. Looking back, it would seem that diamonds are exempt from this rule.

At functions, everyone seemed to have a catalog shirt or suit. Everyone used the products and spoke off the tapes, or standing orders. This is where the term "tapespeak" came from. The recruiting approach was also similar for many, and people in the US became aware of the techniques and I believe this is a contributor to the apparent decline in Amway North America.

While IBOs can certainly duplicate certain things such as dressing alike and using the same tools such as voicemail to run their business, they cannot duplicate the conditions or the market that a higher pin may have had in order to achieve their success. That is why I believe so many IBOs fall short of their business goals. In fact, if duplication was truly the answer to IBO success, then why aren't there more pins breaking? Why do diamonds and other big pins quit the business if the answer was duplication?

I think the answer is clear. Duplication doesn't work. While some Amway supporters claim there aren't many new Amway critics, which may be true, I believe it is because the internet allows easy access to information, thus recruits are aware of the pitfalls and low success rate of IBOs. By the way, there aren't many new advocates around either.

Wednesday, February 24, 2010

Amway - Upline Accountability?

Part of what Joecool perceives as the problem with the Amway opportunity is the utter lack of accountability of some upline leaders. They may tell you to trust them, to submit to them and simply copy or duplicate what they have done, and they imply that you will get the same results. Many downlines over the years have put in blood sweat and tears into the business only to suffer massive losses following the system. Upline will then place the blame on the downline. Citing that they either did not try hard enough or they didn't put in enough time and effort. Despite a shockingly low success rate of system IBOs, nobody seems to fault the system as being flawed. And nobody seems to question whether upline is at fault.

In my observations, I would say that many financial systems are similar. Whether it be BWW, N21, WWDB, real estate gurus or other systems, the success rate is low. Many systems that advertise on television will have a disclaimer that a success testimony is a rare or unique experience. I believe it is similar to the systems in Amway. Dedication or continued spending on the system is not the problem. The problem is often the system itself. It can work for some exceptional people. These people were likely to succeed in other venues anyway. The problem is that is does not work for the majority of people.

The bigger problem, is that for many many years, some uplines have lived high on the hog off of the dedicated tool purchases of their downline. All the while, quesitonable or bad advice was given to the faithful downline. Advice such as quitting a job to attend a function, skipping financial obligations such as the rent or electric bills to buy more tools. One upline even said your family can skip a meal because the standing order may contain the one thing you needed to hear to make your business grow. I have personally seen couples lose their homes and go bankrupt because they followed upline advice. Upline to "has their best interest at heart". Granted, the couple has some culpability in these decisions, but uplines who give this advice seem to get a pass.

Where is the accountability? Some of these uplines who give and gave bad advice, are still active today, and some are still giving bad advice to their downlines. Advice that profits upline and drains downline. Even with valid complaints, it appears that many uplines avoid any accountability. For some, perhaps there is poetic justice, such as diamonds having their homes foreclosed. But as many uplines have nobody to hold them accountable, do you really want to do business with these folks? Would you invest your retirement money with a broker who could not be held accountable? Would you have your car repaired by a shop whose mechanics could not be held accountable? I believe the answer is not to these questions, yet many people are asked to trust and follow the advice of an upline who is not held accountable for their advice.

The system is credited for the few successes that are visible, but the individual is held accountable for any shortcomings or failures. IBOs, I encourage you to hold your upline leaders accountable for the advice they give you. If they won't answer tough questions or take responsibility, then one should wonder why the upline should be given your trust.

Tuesday, February 23, 2010

Amway - A Business Or A Mind Game?

This was a comment loeft on this blog. It is a very good description of what many IBOs experience and how uplines manipulate them.

Amway is totally a mind game. Controlling your mind is the name of the game. Each and everything that is said from the stage, in the done for a reason. When you are in it, you dont think u are being manipulated. Rather you are made to feel like you are a winner..and you are exceptionally better off than the average outside(non-amway) people, whereas in reality you are loosing every day- loosing in the sense, you are not getting the results for the efforts u are putting.

Every possible negative situation that could happen is thought of and covered from the stage, and the cd. For eg: let's say u have been in the business for 5 years and not making profit. You will listen to a cd where the speaker says nothing happened to them for the first 5 years of business- so u will be like, this is so similar to my story..if I stay a little more time, it is going to work for me.

The job world and the outside people (non-amway people) is painted in such a negative color in the system, so u will be like business is not working..but jobs dont work either...let me stick it out and make it in the business...anyway i will not be able to even spend any time with people outside, let me stay in the business.

You are encouraged to have bigger dreams and get pictures of your dreams on your fridge or have a dream board. In a way this keeps u in the biz, b'coz it is your dream and u are like, how can i choose to leave the biz and these dreams.

Big time stroking of ego happens in all associations. At all associations, whoever that is getting results at that time is promoted through the roof. Sometimes when u are not getting any results, some of the big pins, wont even acknowledge ur presence. U will be like...i will show it to u, what i am capable of and will stay in the biz some more time.

The main goal of the system is to keep u in the biz for some more time, until that next function or seminar comes to pump u up or give u hope. In the meantime u will be buying 300PV worth of product and increase Amway's business and will be buying tools and be inncreasing your system's income.

If u have a few people in your group, quitting becomes even more difficult, u will be can i tell these people, whom i gave dreams and got them in...that i am not going to pursue.

If ur upline is in the local area, if u tell them that u dont want to continue, they will come to ur house, spend hours with u and will use every technique in the book to keep u in.

For those of u who have read "How to win Friends and Influence people"- two main techniques are used from that book in amway business:
1) Appeal to Nobler cause- There is no real money in Amway for most people- so what do they appeal to - Impacting people, better marriages, great families, Free Enterprise, Intagible benefits like becoming a better person etc etc etc.

2)Dramatize your ideas- This is what happens in the function- whereas everything is dramatized--incredible fear about economy, job world is put in your mind and incredible rewards achieved by people in the business is constantly talked about( in a crowd of 3000 in a function, at the most 20 so called successful people talk-so there is your ratio of sucess.)

So, how does this business run? why do people stay in? for HOPE...HOPE of making it one day..HOPE of achieving their dreams...They stay afloat with HOPE

Friday, February 19, 2010

Amway - The Cult Following?

Many outsiders see Amway members as being cult like in nature. I also believe that many Amway groups are like cults. The only major difference I can see is that Amway members are free to quit. But there are many similarities to a cult following which I will outline.

Groups are often told not to associate with non members. If your friends and family do not like Amway or are not positive about Amway, they are to be shunned. Members are told not to put anything but positive into their minds, thus IBOs are told not to watch television or read newspapers. thus depriving an IBO of basic information about their communities or their cities. It makes them apathetic.

IBOs are often advised or told to submit to their upline leaders. Just follow the trail already blazed by upline. Don't reinvent the wheel. Just copy or duplicate your upline. IBOs tend to dress alike, act alike and say the same things, but they are discouraged from speaking to crossline IBOs, which I find ridiculous for business associates.

Downlines are trained to edify the diamonds. Standing ovations, adoration and complete submission to these "great" leaders. IBOs are often told to "counsel" with these great leaders. A 50 year old successful married businessman would have to "submit" and listen to the single and 30 year old diamond, because the diamond has accomplished what everyone wants - to be a diamond. (Doesn't this sound like the funny farm?)

Downlines are also constantly on the hunt for new cult members (recruiting). They go through all kinds of trials and tribulations to do so, even attending out of town seminars to learn this skill. The IBOs also channel significant amounts of money to upline leaders in the form of tools purchases, or in some cases, special functions run exclusively by their upline.

So are Amway groups such as BWW, N21, LTD or WWDB cults? I don't know, but I can say pretty confidently that they certainly exhibit traits that can be compared to a cult. What do you think?

Wednesday, February 17, 2010

Amway - The Deception Begins?

For many Amway prospects, there is a deal of deception that IBOs use in prospecting them. Now I don't believe that IBOs are evil or purposely trying to be deceptive, but I believe that many uplines teach some form of deception to unsuspecting IBOs, who in turn use these techniques and in many cases, contribute to Amway'a already battered reputation. There are many examples, but I will just give some of the more recent ones.

Take the perfect water fiasco. IBOs were promoting this product as if it were the cure all for any physical ailments, but apparently, it is nothing more than an expensive drink. The cost of one bottle of perfect water can just about get you a case of purified water at WalMart. Quixtar is not Amway. Another example of deception where IBOs tried to distance themselves from the Amway name and reputation. Another big deception was calling the Amway oppportunity a private franchise. Amway is not selling franchises and IBOs do not operate franchises. If this were true, there would probably be frachising agreements that an IBO would sign with Amway and Amway would provide the training, not individual groups such as WWDB, N21, or BWW.

Teaching such as "fake it till you make it is also deceptive. Uplines will teach IBOs to fake success as a means to attract people to the business. It is why you might see nice people in suits and business attire at meetings, all the while arriving in broken down cars and trucks. Try getting an IBO to tell you what they actually earn from Amway and watch the uncomfortable or belligerent reaction.

I write this post not only because I experienced much of it, but there is evidence and testimonies out there that indicate that nothing has changed. Amway apologists like to cite critical experiences as "outdated", but fail to point out that these deceptive practices are still more common than they like to admit. If you were prospected or retained in the business by deceptive practices, can you honestly believe that uplines have your best interest at heart, or that they really care abour your success? Recently, we have begun to see the hypocrisy and lies of some uplines. Bankruptcy, home foreclosures, terminations, divorces and "quitting" by some upline leaders have exposed the facade.

Sure, diamonds are just people, but they raised the bar on themselves when they made their claims and fortunes on stage. It's time for downlines to hold them accountable for their actions.

Tuesday, February 16, 2010

Amway - Are You A Business Owner?

Many folks involved with Amway call themselves "Independent Business Owners", or IBOs for short. The idea of "owning a business" sounds pretty cool, and is a selling point in recruiting new people. But in a business that touts itself and being so simply, why don't more people actually make a profit? Even some avid Amway supporters understand that most dedicated IBOs suffer a loss, primarily due to system expenses, but they dismiss the failure by saying these IBOs did not work hard enough, quit too soon, or did not take their business seriously enough.

A business exists to make a profit. Sadly, many uplines do not teach IBOs to be profitable. Instead, these uplines teach dedication to the business and to the teaching system rather than teaching IBOs to be profitable business owners. Ironically, the teaching system is disguised as a success system that is practically guaranteed to lead you to wealth. Ironically, the system in it's simplest form, simply transfers money from downline to upline. The uplines profit from the system, thus the uplines can make a nice profit whether anyone downline succeeds or not. Although uplines will say they want you to succeed, I don't think they give a rat's ass about downline success. It's more profitable for certain upline if people keep joining and quitting, as long as the standing orders get sold and there are butts in the seats at functions. If you stop and think about this for a moment, you can see that it makes perfect sense from a business standpoint.

So as a business owners, are you making business decisions with regards to expenditures? And are you assessing the worth of these expenditures? For example, if your monthly income from Amway is $25, is there enough value in attending a major function which might cost several hundreds of dollars (if out of town)? Say a major function costs $500 with airfare and hotel included. Is it worth 20 months worth of your business income to attend? If you say the function is worth the expense, then you should ask yourself what direct benefit your business received by your attendance. If your voicemail expenses exceed your monthly Amway income, how long do you stay committed to such an expenditure? Does your standing order expenses exceed your monthly Amway income? Are your expenses exceeding your income month after month? If so, as a business owner, you need to assess these expense and perhaps cut or reduce these expenses.

Are you consistenly driving more traffic to your website to generate sales? If you are not gaining more customers month after month, how do you expect to generate income? Do your uplines teach you how to drive traffic to your websites? These questions and examples are only meant to be though provoking for new and established IBOs. I have seen too many IBOs rack up tremendous debt by following the system without looking at their expenses with a critical eye.

Are you a business owner?

Wednesday, February 10, 2010

Amway - Working Hard Makes You Successful?

One of the things that many Amway defenders will cite is that the people who don't succeed didn't work hard enough or didn't put in enough effort. While I agree that one must work hard to succeed in many endeavors, I will also state my informed opinion that working hard and success in Amway may not be related. I say this because I have seen so many testimonies of people who worked the Amway business hard and achieved little or no results.

Psrt of the problem is that many uplines emphasize recruiting as their focus, even though there is no direct compensation for doing so. In fact, recruiting downline often comes with much expenses such as gas, babysitters, and the false belief that an IBO needs standing orders and seminars to learn this. Also, Amway has a spotty reputation in the US, thus making recruiting potential downline a very diffcult task.

An important part of any business is to find customers to buy your goods. Because IBOs already spend much of their time recruiting and not selling, they are already at a disadvantage over many other businesses. Add in the seemingly uncompetetive prices of Amway and Amway partner store products and you give IBOs yet another disadvantage over most other businesses. If there were better value in these goods and services, then IBOs who sell instead of recruit would be much more common. Also, the Amway compensation plan often rewards uplines rather than the IBOs who actually do the work of moving the volume.

I also believe that the Amway business is so outdated and inefficient. While you may have a website to sell your goods, you have restrictions that severely limit the ability of an IBO to drive traffic to their website. The person to person touch may sound nice and flowery, but it is the most inefficient way to make sales. It is why people pay millions to advertise during the Superbowl, because you may have a hundred million people watching the adervtisement and can drive up your name recognition and sales.

While working hard is definitely important to succeeding in any venture, I don't believe there is any bonafide correlation that working hard equates success in the Amway business for the reasons I have outlined in this post.

Monday, February 8, 2010

Amway - The Amway Compensation Plan?

One of the major reasons why I think Amway is not such a good opportunity is because of the unfair multi tiered compensation plan. I have heard that Amway pays out about 32-33% to their IBOs, but I find it unfair in that you get rewarded for sponsoring people who move volume more than you do for actually selling products. I believe this is why so many IBOs are desperately trying to sponsor people and in some cases, deception and trickery is used in recruiting, which contributes to Amway's bad reputation.

This multi tiered compensation plan also rewards a few people at the expense of the masses. If an IBO works really hard and sold 100 PV worth of goods, that IBO would get $9 or $10 in a bonus from Amway and layers of upline would split up about $90. I fail to see how that is fair, especially when IBOs seemingly say "do the work and get paid". In this case, you do the work and your uplines get paid.

I think Amway would be more efficient by giving all IBO's 20-25% back as a bonus, with the remaining 8-13% in bonus (33 - 20 or 25) going to certain levels os achievers. I believe that this would truly allow someone to change their buying habits and gain some value. It would also be good for retention of IBOs because a 100 PV would get you a monthly bonus of about $60. If you sold 100 PV to customers, you would get the retail profit plus the bonus. I believe there would be less of an emphasis on sponsoring and more of an emphasis on selling. It would put less pressure on IBO's to recruit and sponsor, and I believe that Amway's reputation could be repaired in this manner. While you would have less emphasis on "going diamond", those who did achieve it could still get handsome bonuses.

I believe implementation of this type of compensation would also eliminate the endless need for cds and seminars. Sure, product expos and some teaching on salesmanship might help, but I believe that compensating the "majority" of IBOs would keep them interested in doing business and would lessen the need for tools. I believe this is a win-win for the majority of those in the business.

I'm sure some Amway apologists will find fault in my line of reasoning, but I believe this is a long term sustainable solution for Amway. Comments are welcome.

Thursday, February 4, 2010

Amway - Diamond, Possible, But Not Likely?

When I was shown the plan, the plan was to go diamond. I believe that most plans shown result in the ultimate goal of going diamond. That appears to be the pinnacle of success in the Amway business. It certainly is the beginning of the speaking engagements and where you would be doing your own open meetings. You are the sought after person for functions and your faithful downline are your servants. These downline would be willing to chauffeur you around, mow your lawn, etc,. Anything to gain association time because you might say that one thing that propels their business to diamond.

In nearly every meeting I attended, the "diamond" lifestyle was flaunted. I attended a function called "Dream Night", which is still in existence, where some diamonds will present a slide show to display all the trappings of being a diamond. I also believe I have seen ample evidence that this still goes on in WWDB today. Anyway, I saw pictures of mansions, jet skis, jets, boats, ATVs, sports cars, designer clothes, shopping sprees, golf outings and other luxuries. While the diamonds may participate in these outings and may own some of these toys, I highly doubt that a diamond or even an above diamond lifestyle consists of basically dooing nothing, waking up at noon and going golfing and then spending the evening shopping and buying more extravagant items. In light of recent events in WWDB, i would say that hard times are falling on the diamond lifestyle. A prominent triple diamond went bankrupt and a host of other diamonds selling off mansions. While we don't know all the details of what is going on, we can certainly conclude that the economy has affected the diamonds as well.

But getting back onm topic. I understand the salesmanship of someone showing the plan, but for information seekers, just be aware that much of the extarvagance you may see is quite possibly an illusion. Just as in a real business, I sugggest that you see to inquire about business financials as real business owners do when getting involved in a new business venture. A lack of willingness to share and/or a lack of transparency by the person recruting you should set off red flags all over the place. Based on figures provided by Amway, it appears that less than 1 in 240 IBOs ever reach platinum. That is less than one half of one percent. And out of those few who reach platinum, less than one percent of them ever reach diamond. Even if you reach diamond, there's a good chance that attrition will eat away at your business before the shine on your diamond pin wears out.

Going diamond is possible, but highly unlikely. In a business where the evidence suggests that most people never make a single dime of profit, I would just caution prospects from jumping into the business blindly without asking tough questions and demanding answers. It's because Amway recruiters will always show you what is possible, but not what is likely.

Wednesday, February 3, 2010

Amway - My Job Is A Pyramid?

One of ths things I take issue with is how uplines will create an us versus them mentality in the business. Thus friends and family who care about you suddenly become "negative" and association with them should be limited. In some cases, people are discouraged from excellence in their jobs or professions because it takes the focus off of their Amway business. What I was told was to do my job, but my radar should always be on for new prospects. Some crossline IBOs turned down promotions at work because they did not want to have to work longer hours or take the focus off of their Amway businesses.

In some cases, the speaker at open meetings or functions will put down people's jobs. A commonly used acronym was J-O-B = "Just Over Broke". Some leaders also would say that my job was a pyramid because you will never earn more than the boss. A completely ridiculous comparison because someone's job has no relationship with how people view the Amway business (i.e. an Amway pyramid) and in a job, every employee gets paid and has a net gain at the end of the month. Not true in Amway. If IBOs only use KATE for example, an IBO at 100 PV or less will already be at a loss, and that is not considering any other expenses that IBO may have. And while a job may have a hierarchy, or chain of command, the business owner and CEO or manager earns their salary from customers, not directly from the pockets of their employees.

Some uplines will laugh about people's jobs, stating that they wake up at the "crack of noon". What these same uplines may not tell you is that they wake up at noon because they are up at 3:00 in the morning doing nite owls for their groups and looking for recruits. These same uplines possibly can't do much with their downlines since their downlines mostly tend to have 9-5 jobs.

So if you are of the opinion that nobody should criticize the Amway opportunity
or IBO behavior, maybe uplines and IBOs should not criticize family and friends who disagree with or are not interested in the opportunity, and maybe the same uplines and IBOs should not criticize people who choose to work jobs. Don't most IBOs rely on their jobs as their Amway income is not sufficient to even pay for their Amway business related expenses?

Tuesday, February 2, 2010

Amway - Investing In Your Business?

One of the things that many Amway IBOs do is to purchase cds, books, voicemail, websites, seminar tickets, etc. These materials are supposed to help an IBO to succeed, but apparently the people who sell these materials are far more successful than those who use them. What makes these materials potentially harmful to an IBO's resources is that many IBOs are told that these "tools" are an "investment" into their business. I believe that these tools are simply a drain on an IBO's bank account and not truly an investment. I will explain.

If you owned a tradional business, you would have to come up with a lot more money than opening an Amway business. That is true, but a traditional business will likely come with a building and possibly some real estate. This is a tangible investment. If your business doesn't work out, you can still sell the land and/or building, or transfer the lease to another business owner and recoup some of your initial investment. Contrast this with former IBOs who endup selling their Amway tools on ebay or craigslist for pennies on the dollar. I'm not even sure they have any takers, except for morons who think the tools have any value.

Also, in a traditional business, you may have to make other "investments" such as perhaps purchasing a company van or other equipment that will help your business be efficient. These materials, while they will depreciate, still carry value and can be liquidated if your business is sold. What can an IBO sell to offset losses if they stop their Amway business? Sell their white board and easel I suppose, or they can try to sell their excess inventory if any, but generally, an IBO's business doesn't gain any equity. You don't own your downline. You don't own anything really, except the right to distribute products.

The way I see it, the purchase of tools is an investment. An investment into your upline's business. The more you purchase, the more your upline prospers.

Monday, February 1, 2010

Amway - Early Retirement?

One of the humorous things I read is when am IBO says he or she is 19 years old and will be "retired" at the age of 24 because of the Amway business. I erpsonally don't know of anyone who has retired primarily on residual Amway income, as many seem to claim. I am not suggesting that nobody has ever done this, but I suspect that there are so few people who may have done it that it is not noteworthy. Even the Crown Ambassadors appear to not only be working, but have very busy schedules where they are constantly on the run. The poor retention rate of IBOs would suggest that even a sizable Amway business could fall apart rather quickly without a constant replacement of IBOs.

I ask this of IBOs. Is your upline diamond, or someone in between you and the diamond retired because of (primarily) Amway income? Do you as an IBO have a projected date when you will "walk away" from the business and retire? When I was an IBO, I always wondered why nobody "walked away" from their business after they went diamond. I believe the answer is crystal clear. Because IBO turnover is so high, if a diamond were to walk away from the business, he would probably fall out of qualification in less than a year. The bonuses would disappear and the diamond would probably have to look for a job. There are many examples of diamonds who have quit, and in some cases, went back to work.

Many unsuspecting prospects may be lured into the Amway business with the hope of an early retirement. Amway recruiters may mention that control of time and money is the key to success, but ironically, for most who sign up, will end up with less time and money than if they did not join at all. For many people. especially young people, it might be a good idea to seek financial advice from a professional and to make long term investment goals. Am investment of about $200 a month can net you close to a million bucks after 30 to 40 years.

Yes, there may be "some" people who retired early due to (primarily) Amway income. But I don't know any. Do you?