Tuesday, June 29, 2010

Amway - What's A Better Option?

One of the humorous things that IBOs say on my blog is if Amway isn't such a great deal, then why don't we offer a better solution? I guess it's not enough that there are facts and experiences posted here so that information seekers can find and make informed decisions about joining or not joining Amway, but we must also suggest better options? Well, I will offer some. While I am not advising anyone to listen to my thoughts, nor do I think you should act on what you read what's here without doing your due diligence your own soul searching, here are my opinions on what may be better than Amway:

1. Be a better steward of the money you already have. Many people have enough income but simply channel too much of it to things they don't need. A daily $5 cup of starbucks for example. Disciplined saving and investing.

2. Get a second job and set aside a portion for saving and investing. You will not only have more discretionary cash, but also more to be able to set aside for your golden years.

3. Start your own small business. The biggest issue with Amway, in my opinion is the endless supply of training that uplines sell. It causes most "serious" IBOs to end up with a net loss. You can find a niche product and sell it on ebay or craigslist, unlike Amway products. Another type of small business might be something like learning to do minor household repairs or installing hardwood flooring. These kinds of services are quite common and can be lucrative.

4. Do nothing. Since most business building IBOs lose money, doing nothing, although comical, actually makes you bette off than losing money because of functions and standing orders.

5. Spend more time with your family. Ironically, many IBOs have this as a goal, but actually spend less time with family because of Amway related activities.

There you have it folks. There are some ideaas of what might be better than spending your time and money participating in the Amway business and the Amway motivational organizations. While these are only ideas, only you can decide what is best for you and your family. In whatever you decide to do, I wish you well.

Monday, June 28, 2010

Amway - WWDB: A House Of Cards Falling Apart?

When I was an IBO, I was in WWDB. I was told that they were the best LOS, the fastest growing, with the best leaders. We were told to look at the fruit on the tree, that surely, that was proof that WWDB was the best. At the time I believed it all. Afterall, my upline diamond was one of the fastest to achieve that level and things were looking up. I had heard of recent functions where there were over 50,000 in attendance at the Kingdome in Seattle (at that time). We were told that nobody made a cent of profit from the functions and other tools. That upline used proceeds to make functions better and cheaper for IBOs. It all sounded like a great organization and I was certainly going to be rich if I only followed the system and their great leaders.

Well, after a year, I quit. Not because I could not build the business, but because my upline became overbearing, demanding that I submit to him, giving me bad advice and he was also unable to answer when I asked why I achieved the level of 4000 with the proper parameters but was not making any net profit. There was no incentive to spend all my time and money building a business for no profit and I quit. My upline's advice of dunping my finacee' to focus on Amway also contributed to my decision to quit. After I quit Amway, my life got back to normal until one day I happened to stumble across a website called Quixtar blog. It was then that I realized how many lies I was fed and how badly our uplines had taken advantage of downline IBOs.

It seems that the WWDB house of cards started tumbling with a couple of WWDB diamonds
having homes foreclosed. We later saw a blog post indicating that a WWDB triple diamond was in bankruptcy proceedings. That was followed by Ron Puryear's river house going up for sale, followed by the listings of other WWDB diamonds who were selling their homes. It is true that they may be selling the homes to liquidate some cash or to downsize, but in a bad housing market and if the homes were paid for in cash as many a diamond claims, then it seems like an odd time to sell. Of course it could also be that Amway in the US is shrinking and with less sales and fewer IBOs, there is less tools income and Amway bonuses, thus perhaps some of these diamonds simply cannot afford these homes any longer? Toss in a prominent WWDB diamond apparently divorcing and rumors of a couple of WWDB diamonds moving to form their own systems and you can see gaping holes in the WWDB system.

It has been my contention that many diamonds are possibly living in heavy debt because even with a decent income, their excessive lifestyles as portrayed in functions, simply cannot be sustained unless they have other major sources of income. In fact, since a large portion of a diamond's income is from annual bonuses, a diamond's monthly income may be relatively small. In any case, it appears to me, that WWDB is on shaky ground and some of their hypocrisy is being exposed. They apparently built a house of cards and now it may be falling apart.

Thursday, June 24, 2010

Amway - Tax Refunds Are Profit?

One of the things that I have observed is how IBOs are so misguided by their upline, that they think that their business losses, which result in a tax refund is somewhat like a profit, or that they are getting a free pass with the government footing the bill for their standing orders and functions. In the past, IBOs have been audited and had many business deductions disallowed because the tax department ruled that they were not truly running a business, but participating in a hobby called Amway.

I know that most IBOs are deducting the cost of their training materials on their taxes, but the issue at hand is whether the training materials are resulting in increased sales for your business. If you are running a "buy from yourself" business, then there is a strong possibility that your expenses may not be valid deductions come tax time. If you are not selling products to customers for a profit, then there is a chance that your expenses are not valid deductions. It would be sad indeed to be audited at tax time a few years after you have been an Amway business owner, only to find out that your expenses are not valid and that you may owe tens of thousands of dollars in back taxes.

Another apparently common mistake of IBOs is to think that their business expenses are basically free from the government because they may end up with a tax return. Your expenses are deductible from your taxable income. Thus if you had $10,000 in business expenses, your return would depend on your tax bracket. If you are in the 15% tax bracket, then $10,000 in expenses would get your about a $1,500 tax return, depending on other deductions you may have. But IBOs get duped into thinking they made a score and now get back $1,500 when they may not have had a refund in the past. Obviously in this case, the IBO would have been better off saving the $10,000 and never getting involved in Amway. Some IBOs proudly proclaim their refunds as basically a windfall, almost like it is a profit. That is truly scary.

Folks, there is no free ride. If you are spending money on legitimate business expenses with an intent to make a profit, then there is nothing wrong with that. But if you are traveling to conventions hoping to learn the secret of sponsoring more downline, you could be walking on thin ice should the IRS ever decide to audit your business. There have been many cases in the past where not only did IBOs lose their shirts due to the business support materials they purchaed, but they got double whammied later when the IRS disallowed tax deductions, leaving them in financial ruin. I truly hope you aren't on that path.

Check out this link:

"TRAVEL AND ENTERTAINMENT have always been areas of abuse. Sections 162, 262, and 274 are always applicable and sometimes Section 183. Since most of the travel is primarily to attend social gatherings for entertainment and motivational purposes, any real business purpose is suspect. Unless the taxpayer can show that attending seminars, meetings, etc., meets the requirement of Section 162, the travel should be disallowed. Amway people have been unable to show that attending these meetinqs increased their sales. The agendas of these meetings appear to be primarily for entertainment, socializing, and listening to motivational speeches. The meetings have nothing to do with promoting the sale of Amway products to the general public. In fact, Amway distributors are specifically warned aqainst mentioning either Amway or selling when recruitinq potential downline people. Since it is not likely that the taxpayer will increase his sales by attending these functions, then there is not a reasonable business purpose for the trips"

Wednesday, June 23, 2010

Amway - What Has Changed In 15 Years?

If I'm not mistaken, Amway was booming in the mid 90's. Their sales had hit a new high of around 7 billion at that time. Recruitment was up and there seemed to be new diamonds and emeralds popping up all over the US. I joined the Amway business around 1997-1998 and the wave was still going. I later quit, discovered the lies and fraud that was used to entice me to join and eventually became an advocate for the truth about the AMOs and some of the AMO leaders.

One of the things used by Amway defenders is that the experience of people who are critical of Amway are invalid because the experience may be dated, or because some people who are critical of Amway have never actually been IBOs. I don't buy that argument because you can be quite knowledgeable about certain things without having done them. I know that I would not put my hand on a hot stove because my hand would get burned. Even if I have never burned my hand on a stove before, I know this. Or if I burned my hand on a stove 15 years ago, would my experience be different if I put my hand on a hot stove now? Unlikely.

Yes, the Amway business has undergone some changes over the years. Most groups do not use the call in an pickup method of product movement, although my understanding is that some groups still do this for standing orders and other tools. There is accreditation which may have helped, but even with this, there is evidence of unethical practices going on, just that these issues are going on on small meetings rather than taped functions. Many groups stil focus on recruiting new IBOs and not on selling products for a profit. Many groups still focus on selling their downline tools and not ensuring profitability for new IBOs.

My former group, WWDB, apparently still has many of the leaders who were present when I was an IBO. There have been very few new diamonds in the last 15 years or so, relative to the number of IBOs that have come and gone. The lies and deception by the upline leaders were never acoounted for. They have been exposed as basiacally frauds. Leaders who taught "pay by cash only" are found to have debts they cannot pay. leaders who swore that Amway saved marriages are getting divorced. Those who swore that tools were the key to success have little or no success to show for all the tools they sold.

What has changed in the Amway business in the last 15 years other than a name change to Quixtar? Not much when you look at the big picture. The masses are still losing their asses today.

Tuesday, June 22, 2010

Amway - IBOs Drowning In Debt?

One of the things I noticed is that many IBOs who support the Amway opportunity seem to be in debt. I know that being in debt is one of the reasons these prospects are drawn to the oppportunity, because they believe that they will earn so much cash that their debts will go away. I remember seeing a presentation where the speaker touched on how people were in debt with credit cards maxed out. Thus this business is for you because you can earn enough to pay off those credit card bills or maybe go diamond and pay cash for everything.

In my informed opinion, the speakers who promote Amway in this manner are unethical at best, because they will teach IBOs to live below their means, cut expenses, and reduce debt, only to turn around and have the IBOs spend their cash on tools. It's not really debt reduction, but simply redirecting an IBO's purchases towards things that benefits the upline. It is why I often wondered why a speaker would say it was okay to go in more debt, only to invest in their Amway business. I mean, debt is debt and if IBOs are to reduce their debts, they should also be cutting their Amway expenses and focus on selling products, which can result in immediate cash.

I also believe many - a - diamond to be hypocrites. I heard many of them speak about how diamonds pay cash for everything, including their homes. I find it quite humorous and very hypocritical of some of these speakers who were exposed as having their homes foreclosed. One of these speakers, a prominent triple diamond, apparently had some involvement with bankruptcy proceedings because he could not service his debts.

I also believe that many diamonds may be drowning in debt, moreso than the downline that they teach. Why do I believe this? Because they portray lifestyles that are not sustainable on the incomes they have. Sure a diamond may have a $250,000 income consisting of Amway payments and tools. But if anyone does the math and considers taxes and business expenses, these magical diamonds suddenly don't have much cash left over to be able to purchase mansions and sports cars. So how do they obtain these trappings? I believe many diamonds might be financing their cars and homes, and may actually be in heavy consumer debt while trying to portray a diamond lifestyle.

Amway pundits may argue that hey, at least these folks don't have to answer to a boss and wake up early to go to a job. While that may be true, most job people don't have to stay up until 3:00 in the morning showing plans and having nite meetings to motivate their downline. Furthermore, a diamond must have to live in fear that a scandal could tear apart their group or that a disagreement with an upline could get you cut from tools profits.

To summarize, I don't believe diamonds are that different than the rank and file IBOs. They get divorced, they have debts. They may have bigger incomes, but that is all relative. A man with a $50,000 a year salary could live comfortably and debt free while someone who earns $250,000 can be drowning in debt because they live beyond their means while the $50K man lives below his means. The evidence is there, diamonds live excessively and many flaunt wealth. In the book, the millionaire next door, Stanley and Danko say that people who flaunt wealth, often are not wealthy. Are you as an IBO, drowning in debt? Maybe you are simply following the example of your upline diamond? Maybe?

Monday, June 21, 2010

Amway - J-O-B?

I recall many meetings and functions where the diamonds talked about how your job was making you "just over broke" or "jackass of the boss". They tried to put down jobs, as if working a job were some kind of cruel punishment for the masses. In reality, IBOs could not feed their families, pay their bills and they could not make the diamonds rich without their jobs. I remember seeing videos of people shooting their alarm clocks or a limosine pulling up to someone's place of employment and whisking off someone who recently went diamond or reaching some other pin level.

I suppose that for someone young, who may be in their 20's or 30's, the prospect of working another 30 years seems like a daunting task, thus a "shortcut" such as working 2-5 years sounds like a good alternative. It makes sense, until you actually start trying to build the business and find the name reputation and products difficult to sell. At some point, your investment into standing orders and functions starts to add up. You start to wonder if you made a mistake in trying to find a shortcut to financial freedom. You start to wonder if financial freedome even exists in the Ama-world. Why are the diamonds still working? Why don't any of them "walk away" and collect residual income for life while walking on the beaches of the world?

Luckily, you did not quit your job. While your current job may not equip you with financial freedom, you are likely able to pay your bills and put food on your dinner table. That is more than most people can say about the income they receive from Amway. I used to wonder how much money these diamonds actually make. While they may earn a nice income (if they are actually qualified), a diamond lifestyle can render them even more broke and in debt than the people they recruit into Amway. I believe many diamonds are living month to month, worrying about their finances because they portray a lifestyle that cannot be sustained on the kinds of incomes that Amway reports (i.e. $147,000 average diamond income). A recent triple diamond in bankrupt proceedings revealed that while they earn a nice income, they may not be able to sustain an excessive lifestyle, and certainly not without making a significant income from selling functions and other tools to downline.

Rather than getting excited about seeing a Mercedes Benz, ask your diamond how much they earn from Amway. Ask them why there aren't any diamonds taking advantage of residual income for life, thus walking away from the Amway business? While working a job and saving money may not sound that attractive, it is still a much better alternative than working a job while channeling your income into standing orders, voicemail and functions that do nothing except make your bank account lighter. Financial security and long term sustainablity takes hard work and discipline. Many who promote Amway trick prospects into thinking that Amway is a shortcut to get rich. It isn't, save for the owners of Amway and a few old time Diamonds who control the systems. The facts are there, you just need top recognize them.

Thursday, June 17, 2010

Amway - IBOs In Denial?

It is a very sad thing indeed, to see so many IBOs living in utter denial. Most IBOs are probably good and hard working people, but they get taught misguided and unethical things by their upline and as a result, many IBOs end up living in denial. Many IBOs are losing money because of their dedication to the tools system, but they are taught that never missing a function makes you successful. Or they are taught to ignore facts if they have a big dream. These kinds of teachings are contrary to the basics of running a business.

Even when an upline leader may have been caught with their hand in the cookie jar, these leaders simply revise history or deny confirmed allegations and the faithful donwline simply ignores the issues. It seems that many IBOs believe that their uplines walk on water. Of course these leaders are human, as many point out, but I will also point out that theur perceived divinity is a big factor in their sale of training materials, thus they should be held accountable for their actions and their actions should be held at a higher standard than a rank and file IBO.

For example, I still see IBOs denying that a prominent diamond was in bankruptcy proceedings despite the fact that there are public documents confirming this. I still see Amway apologists claiming that certain things are not taught by upline anymore, but IBOs bloggers still talk about misguided teaching, such as how Amway or WWDB IBOs have a lower divorce rate than the general public, even when one of their leaders apparently got divorced recently. It's scary how many IBOs apparently don't belileve their own eyes and ears.

It's apparent that many IBO are simply in denial. They believe they are successful even when losing money month after month. They believe that their leaders can do no wrong. They believe that they will succeed if they never quit. They often believe that naysayers of Amway are broke or losers. But the facts are there. It is a fact that the vast majority of IBOs on the system lose money. It is a fact that the average IBOs earns less than the minimum wage. It is a fact that most IBOs cannot or do not sell many Amway products. It is a fact that some upline leaders make most of their money selling tools to their downline. It is a fact that some upline leaders lied about tool profits in the past and may still be lying about it. These are some of the facts about this opportunity. You can believe it or deny it, but look at your bottom line. If you are losing money, are you successful or in denial?

Wednesday, June 16, 2010

Amway - How Do You Actually Make Money In Amway?

A recent comment left on my blog asks the question - how does someone actually make money in Amway? It's a great question and one that deserves to be addressed since it seems that so few people actually make any real money in Amway. The Amway corporation reports that the average IBO earns $115 a month. That $115 a month is after disregarding IBOs who "do nothing" and that also includes Amway diamonds. If you have ever been involved in Amway, then you know as a new IBO, you are likely to earn about $10 a month if you are in the lowest PV bracket (100 PV).

One of the things that Amway leaders like to talk about is how Amway returns about 33% of their income to the IBOs in forms of rebates or bonuses. In North America, that turns out to be over 300 million. Sounds like a great deal right? What they don't mention is that for the vast majority of new IBOs, the compensation plan is very unfair, with new IBOs basically getting peanuts while layers of uplines take the lion's share of that bonus. The only way an IBO can move up the bonus bracket is to find downline who will then sit in the unfair positions so you can get a bigger piece of the action.

But it still begs the question. How do you make the serious money in Amway? Apparently, the real money is made by acting wealthy, and showing off wealth, even if you don't have it. By showing off untold luxuries and lifestyles that most people only dream of, you can then get unsuspecting prospects interested and sell them materials such as cds or seminar tickets and convince these nice people that these materials contain the secrets to obtaiing the same wealth that you have attained. Even if more than 99% of the participants never make a profit, you simply blame them for not working hard enough or by claiming that they didn't follow your system exactly how yo prescribed. Then when someone actually breaks through, you tout them as a shining example of success, just as lottery promoters show the winners but not the harsh reality of the masses. Now Amway is not a game of chance, but certainly, the final outcome is eerily similar to that of a lottery. A few winners and masses of losers.

Even when your faithful followers start to realize that your system is not really working, you can keep them hanging on and purchasing more training materials by convincing them that quitting means they cannot succeed in life, or that quitting means you are doomed to poverty for the rest of your life, or that quitting means you are a broke loser.

So to summarize, you can make a lot of money in the Amway opportunity by pretending to be rich and then selling training materials to unsuspecting IBOs who think they can attain the same level of success as the tenured diamonds. Sadly, that apparently is how many diamonds and above make their "real money".

Tuesday, June 15, 2010

Amway - Brainwashed IBOs?

From Dictionary.com Brainwashing:

1. a method for systematically changing attitudes or altering beliefs, originated in totalitarian countries, esp. through the use of torture, drugs, or psychological-stress techniques.

2. any method of controlled systematic indoctrination, esp. one based on repetition or confusion: brainwashing by TV commercials.

3. an instance of subjecting or being subjected to such techniques: efforts to halt the brainwashing of captive audiences.

**When I was an IBO, our upline told us that we as IBOs needed to be brainwashed. That our brains had too much negative and that we basically needed to be re-programmed to think positively. That the standing order and functions and association would brainwash us for success. At least that was the pitch.

Having been removed from the business for some time now, I can see the strategy of the upline. Yes, they want to change your thinking, but not for the reasons they claim. They simply want IBOs to be positive about the Amway oppportunity and the tools business. By getting IBOs to have a myopic positive view of Amway and the tools, there is a better chance of retaining that IBO in the business, even if the IBO is losing money, month after month after month. They remain positive and think that their next plan or the next month will bring results that they have been working towards. Maybe success is right around the corner. Or at least they have become nicer people by staying in the business. Many IBOs forget why they joined the business in the first place, which was to make money!

While there may not be phyiscal coercion or torture as decribed in the textbook definition, I believe there is a systematic method of mind control at work. For example, uplines already know most of the objections by prospects so they program an IBO's response. Thus the term "tapespeak" as many IBOs give the same predictable answer to common questions. Uplines will also cleverly talk about how Amway is "hard work". I believe this is to avoid the claim of something being too good to be true because it involves work. But IBOs must have the idea that they will be rich. Why would someone agree to hard work for little rewards? It is why uplone will show off wealth such as showing slideshows of cars or mansions. Of course, they will never show their business tax returns as REAL business owners would do. If they did, I think many IBOs and prospects would be shocked at the poor financial conditions of the leaders they look up to. There is plenty of evidence out there. A prominent diamond in bankruptcy proceedings, diamonds having homes foreclosed, diamonds selling off homes. The list goes on.....

For IBOs and people seeking information on Amway, I urge you not to shut off your common sense when taking a look at the business. Contrary to what some uplines teach, the FACTS do matter and your bottom line (profit or loss) is just about the most important thing in running a business. Beware of brainashing and indoctrination, less you end up sounding like a mindless robot defending Amway when you are suffering a net loss of income every month.

Monday, June 14, 2010

Amway - The Business Works? Really?

The business works if you work it! That's what many Amway enthusiats will claim. I do not believe that is true and I will further explain in this post. Many IBOs who claim that the business works are usually new and are unable to show any evidence that the business works, except perhaps to show a photocopied check from an upline diamond or the like. Even many tenured IBOs talk a big game but have yet to show evidence that they and their groups are profitable.

Let me make a disclaimer that some people do make significant money from Amway, but most of those folks are tenured diamonds who are almost in an exclusive club that raraely gets new members, but may often lose members. There is only a short list of new diamonds that I know of in the US, and I have heard that even these new diamonds may have had legs in other countries. It would seem that Amway is not growing in the US and Canada. Also of note, Amway did not release figures that are seperate between Amway North America and the rest of their overseas operations.

Ok, so Amway enthusiasts claim that the business works if you work it. Business in its simplest form is selling a product or service for a profit. Yet many many IBOs spend so much of their time doing other things, as advised by their upline "mentors" who sell them training materials that take up much of their valuable time. Listening to tapes/cds, attending functions, reading books, and other training activities not only costs the IBO money, but takes up valuable time in non -income producing activities. Nobody makes money by reading books or attending seminars.
Inviting people to see "the plan" may be a way to potentially generate volume but with Amway's reputation, even this is a hit and (mostly) miss activity.

Yet IBOs spend almost all of their time doing these activities (the work) when they could be better off not getting the training and focusing on selling the Amway products and services. Even that comes with a handicap as Amway products as a whole, costs a lot more than purchasing similar or the same products as a big retailer such as Costco or WalMart. It is why most IBOs eventually get discouraged and quit far before the promoted 2-5 year plan. They simply do not see enough value in staying ib business so they simply walk away.

Few people will even bother to see the plan once you mention "Amway" and for those who are open minded and motivated to register end up having to deal with a hard to sell opportunity along with high priced common commodities such as soap, vitamins and energy drinks. It's pretty easy to see that the business does not work, even for most of those who actually work it. There are simply too many issues with the business that hanidcaps those brave enough to try. It seems even the fiercest defenders of Amway are unable to provide a shred of evidence that they have actually made a profit from this opportunity.

Thursday, June 10, 2010

Amway - When Will You Be Walking The Beaches?

One of the battle cries I heard as an IBO was how one day, we would all be free and walking the beaches of the world, financially free and not having to own an alarm clock and reporting to a boss. I mean it sounded like a cool deal. All you had to do was work the system 2-5 years and follow thhe proven system of success. At the time, I thought honestly that I was going to do just that. But as time passed, I started to notice things said and taught by the upline leaders that just did not make sense.

For example, why would we constantly be told to get out of debt and live below our means but it was okay to go deeper in debt to attend a function or to buy more standing orders? Of course I now know about how upline's apparent greed was what led to this type of advice. Or we were taught that God was our top priority, followed by our spouse, family, job and then the Amway business. But when anything conflicted with a function or a meeting, the Amway function was ALWAYS to be the priority. "Never miss a meeting, period" was the advice we got from upline.

Which leads me to ask prospects and IBOs. What progress are you making? When will you be walking the beaches of the world? Why aren't any of your upline leaders retired from Amway, collecting mountains of cash and walking the beaches of the world? Why doesn't Amway advertise residual income as a benefit of the business if it were true? Can you even name one or two people who built an Amway business and actually walked away from their business and collects income? Surely a 50+ year old business with this benefit must have hoards of people realizing this wonderful benefit? Why can't people name more than 1 or 2? (I know why)

What many people, including IBOs don't know is that you can never go inactive in Amway. Amway, as far as I know, will only pay bonuses on an active business, thus if you ever walk away, someone will have to run your business. You will also need to move a certain amount of volume in order to qualify for some of these bonuses, and you will have to hope that none of your downline ever quit or stop ordering products, or else your bonuses will dwindle down to little or nothing very quickly.

Wednesday, June 9, 2010

Amway - Random Observations Of IBOs

Observation #1: In general, IBOs are less successful in life than others. That is why they are more open to the business and why they can be convinced that there is a shortcut to retirement and perpetual wealth. When I was an IBO, I was not where I wanted to be financially, as I was younger and at the earlier stages of my career. I would not be open to “options” right now, however, many people looking for more in life or a shortcut to retirement may be more susceptible to looking at options. It's just that the Amway opportunity, in my opinion, ir a poor option.

Observation #2: The biggest zealots/supporters appear to have the smallest businesses. They talk the talk - but no evidence of walk the walk. Also, any discussion about their personal success with the business is limited and shrouded in secrecy or they will make vague references about their level of success. They will say that their incomes are not relevent to the dicussion or will point out a copy of someone's check or show a picture of a diamond's mansion, but will never disclose real financials like a REAL business owner would.

Observation #3: The business has a bad reputation and cannot be marketed to the general public without some degree of deception. It’s why there are so many testimonials of people tricked into attending meetings (including myself). Being straight forward with information will likely get you a resounding “No thanks”.

Observation #4: It would appear that much upline teaching is not focused on actually running a profitable business, but dedication to the system. It’s why so many IBOs don’t seem to know what a profit loss statement is, and don’t bother keeping one themselves. It’s also why the content of many BSMs is to purchase more BSMs. At functions, they will tell you to attend more functions and buy more standing orders, and on standing orders, they will tell you to never quit and to attend more functions.

Observation #5: IBOs in general don’t seem to have planned out their retirement. They are convinced that the Quixtar opportunity will provide for them when they reach their retirement years. They put down people who are working jobs and investing for their futures. They feel that purchasing function tickets is their investment for retirement. While a fraction of 1% might make some significant money in Quixtar, the vast majority do not. The fact that the majority may not have put forth a Herculean effort is irrelevant in my opinion. The bottom line is that the vast majority will not make an income from this opportunity. To ignore this fact is burying your head in the sand.

Tuesday, June 8, 2010

Amway - Upline Teaching That Doesn't Add Up?

When I was an IBO, and even now, there is ample evidence that uplines continue to teach contradictory and poor business advice. I believe the abuse of downline continues because nobody has ever corrected or held upline accountable for their bad advice or even outright lies, such as the previous claim that nobody made a profit from tools. While some of the teaching might make sense on the surface, I believe that much of the upline teaching has an under current designed to profit the upline at the expense of those they are advising.

For example, upline may teach you to get out of debt and live below your means. While that may seem like good advice, it is rendered meaningless if your sacrifices and savings are spent on purchasing tools. I've recently been following the blog of an IBO who got out of debt by selling his home and cashing out his 401K. I believe he was advised by upline to do this. The sad thing is that I believe he is overspending on tools and products with the savings he realized by wiping out (most of) his debts.

Another interesting piece of advice would be to get into vertical alignment. Which is God = #1, Spouse #2, family #3, job #4 and Amway #5. Yet anytime a conflict comes up with a function or a business meeting, the "priorities" somehow turn out where the Amway meeting becomes #1. Sadly, I have seen some dedicated IBOs miss their kids childhood days chasing the Amway dream and they never earn a net profit. If your upline teaches this, I would urge you to consider keeping Amway at #5 and not reschedule family or church gatherings.

Selling products are vital to running a business, yet many uplines do not place emphasis on this aspect. Many IBOs are taught to self consume products. If this happens, then the only way for IBOs to earn an income is to recruit downline. This borders on the parameters of legalities. Also, it creates an artificial need for Amway products. How many former IBOs consistently use 100 to 300 PV?

Some upline also emphasize the "side benefits" of the business such as you being a nicer person, which may or may not be true, depending on the perspective of others. They may say that they are your friends for life, at least until you miss a function. They may claim that Amway saves marriages, while not talking about IBOs who may have divorced BECAUSE of the Amway opportunity.

Many uplines will teach downline IBOs things that benefit the upline and not the IBOs themselves. If you see or hear some of these ideas or others. I urge you to ask tough questions about why the teaching may be contradictory to the princioples of business or of what they are teaching. If you are taught to get out of debt, I do not believe your savings from doing this should be spent on functions. You should seriously reconsider adding debt to build your business, afterall, you were probably told that the Amway business has little to no risk or overhead. Hold your upline to their promises. Do not allow them to manipulate it for their own benefit.

Good luck to IBOs and prospects, but seriously think about teaching that does not add up.

Monday, June 7, 2010

Amway - When Do You Have Enough Tools?

One of the things that many Amway defenders will claim is that too many IBOs do not apply what they are taught, thus they do not succeed. While I agree with this in principle, I believe that there are many many more problems with the Amway systems that have nothing to do an IBO's willingness to apply what they are taught.

For the record, I will be refering to IBOs who actually make an effort to build the business. I know many IBOs do little or nothing, but that in itself is a whole different issue, probably stemming from deception in the recruitment process. But okay, let's look at the systems.

Voicemail. The voicemail systems used by many groups are not only expensive, but completely unnecssary. Most newer IBOs do not even earn enough money from Amway to pay for their voicemail, and frankly, in an internet based type of business, I don't see why email or skype is not ut ilized, except for the fact that eliminating voiemail would be eliminating a profit center for many uplines. In fact, if voicemail must be used, why aren't IBOs using the Amway version of voicemail so IBOs can gain PV/BV? The excuse that KATE may be better doesn't fly because I'm sure Amway could make improvements to the system they have. But overall, email would still be just as efficient at no cost.

Standing orders. If you attend functions, why would you need an endless suppply of cds or tapes? Most of these are recorded at functions anyway, thus upline is hitting you twice as you pay for the function and then get hit up for the standing order again. And how many standing orders give you specific and practical advice on running a profitable Amway business? I am guessing that very little practical advice is given on these standing orders. Why do you need a new supply every week?

Functions. If standing orders are so valuable, why do you need to spend money on functions, especially functions where airfare and hotel expenses are needed? Why wouldn't there be less major functions and more regional functions? If the true intent of these meetings is to generate IBO success, then shouldn't the IBOs be able to attend functions closer to home to reduce cost and to make them more accessible to the rank and file IBO?

All in all, I believe that some tools may have value and can teach IBOs some sales and relationship techniques, but I also believe that tools are overpromoted in many LOS groups, to the financial detriment of many IBOs. If IBOs were made profitble in their first month or months of business, there would be less need for so much motivation. When do you have enough tools?

Friday, June 4, 2010

Amway - The Problem With The Amway Opportunity

One of the reasons I started blogging was to share my personal experiences in Amway and WWDB, and to allow information seekers and prospects to get an insight into what I see as potential problems with the Amway opportunity. In many of my blog articles, you will notice that many of the problems I have identified with the Amway opportunity are more closely ties to a motivational group such as WWDB, BWW, or Network 21. But Amway apparently has allowed many bad practices to go unchecked, thus they are not completely guiltless in the abuse of downline over the years.

Too often, the Amway opportunity is misrepresented by IBOs. For example, I have heard so many times, that Amway is a franchise opportunity, which is not true. I have also heard so many times that an average Joe can work for 2-5 years, and create a willable and residual income that will allow you to not have a job, and possibly to allow you to enjoy untold wealth and luxury. I don't believe this is true for the vast majority of people who were sold on the Amway opportunity.

The bigger problem is the promotion of motivational tools as being the key to success in Amway. Although technically "optional", most uplines will promote the tools as necessary and that an IBO would be insane to build a business without tools. Thus many IBOs spend money on tools and sadly, most IBOs never make enough money in Amway to cover the cost of their tools. In fact, over a number of years, I have heard of people losing tens of thousands of dollars to the tools systems. And once you start participating in the system, the decision to quit can be difficult because of the time and money that an IBO may have already invested. Also, the thought that maybe upline is right and that persistence will pay off. Well, there is no unbiased documentation that persistence and hard work (and applying the system) actually works.

Amway defenders like to point out that all the new platinums and diamonds used the system, but FAIL to point out that the rest of the IBO force who may have worked just as hard simply ended up with business losses. Amway defenders also fail to point out that perhaps a larger number of platinums and diamonds may have failed to requalify at that level. So much for willable and residual income. By the way, of residual income is a benefit of the Amway business, why can't I find anything from the Amway corporation to confirm this?

I could go on and on, but lastly for now, I think it's a bit shady for diamonds to show off fancy cars or mansions as a way to flaunt their alleged success in Amway. I would prefer the traditional manner of reviewing business tax returns. Showing a copy of a check means nothing because business expenses may have exceeded the amount of the check, leaving an IBO with a net loss. But in the Amway opportunity, it is commong practice for IBOs to hide their income or to show a diamond's Mercedes as proof of income. It doesn't add up for me and I would urge information seekers and prospects to scrutinize someone who tries to impress you in this manner.

Those are some of the issues I see with this opportunity. I challenge IBOs and LOS leaders to clean it up.

Thursday, June 3, 2010

Amway - Eagle: A Great Achievement Or A Way To Fleece Yourself And Your Downline?

Eagle Parameters:
Signed Counsel Sheet to Upline Diamond
300 PV personal use/retail for couples, 200 PV personal use/retail for singles
6-5-3 (PB/SO/MF) - Explained below
6 legs at 100 PV or higher
5 legs on standing order
3 legs attending major functions

What is Eagle? Basically, Eagle is a made up goal. I believe it was originally made up by WWDB. In fact, I think Eagle was around when I was an IBO back about 12-13 years ago. The reason why I say it is a “made up goal” is because it is. It was not a part of the Amway sales and marketing plan. You receive ZERO additional compensation from Amway for achieving the designated level of Eagle, aside from your volume rebate. In a previous post (recently), I broke down the numbers, giving the IBOs the benefit of the doubt in sales, and the only conclusion I could arrive it was that most Eagles must be losing money.

The Amway sales and marketing plan, as shown in many groups, assume that an IBO will move 100 PV in volume, though a combination of personal use and selling of products to family, friends and customers. To be an Eagle, you are expected to move 300/200 PV (Couples/singles) in personal volume. In many, and probably most cases, an IBO typically will consume most of that 100 PV by him or herself. That means the Eagle program artificially inflates the need for Amway products. If you disagree, name one former Eagle (and I am one) who consumes Amway products to the tune of 300/200 PV per month. *crickets chirping*

I believe the Eagle program was simply the brainchild of some LOS leader who wanted to create some kind of incentive to prove an IBO’s loyalty to upline and to secure a certain level of tool purchases from downline. If you do the math, and consider that fact that IBOs on standing order and attending functions are somewhat serious business builders, then every individual in the Eagle program is likely to be losing money. The person designated as “Eagle” may be duped into thinking they have a net business profit, but when you factor in the extra 200/100 PV that you are expected to move, you are losing money, possibly lots of money, unless you are selling that extra 200 PV. If not, you are simply absorbing an extra $300 to $600 worth of products that you probably do not need, If Eagle was truly something worth attaining, wouldn’t it be promoted by Amway and given some kind of financial incentive?

As an IBO, you are MUCH better off simply by moving your 100 PV with a combination of personal use, and selling to friends, family, and most importantly, retail customers. In fact, someone simply selling 200/100 PV in products at full suggested retail price is likely to be better off than someone who is at 1000 PV with an Eagle structure, but self consuming the majority of the 300/200 PV personal circle that is in the Eagle parameters. I challenge anyone to show how a group can be better off financially by maintaining an Eagle structure. *crickets chirping*.

Amway - Joecool Gets A Thank You Letter

A recent comment left on my blog. It says a lot. Enjoy! Here's the heartwarming comment:

I prospectively attended my first AMWAY fucntion this evening. I've spent the last several hours online; from what I've found Joecool's account is not the exception but the standard. I have a meeting with my sponser tommorow evening, where I'll be returning the information he gave me and politely decline.

Honestly, if I had only read Joecool's testament of failure; I may have given the sponsor an opportunity to ellaborate on whatever success he has had with this system, and further considered getting involved with this organization; however, the arrogance and malice expressed by the AMWAY supporters on this site, have undoubtedly convinced me that this is not something I want to be a part of.

The problem is- though I hardly know the guy- he seems nice: I sincerely regret the disappointment he'll suffer tommorow. He said he had been with AMWAY for a little over a year. He approached me in the grocery store; and after a few minutes of akward conversation, I reluctantly gave the guy my phone number. Talking with him this evening his temperament seemed like a strange, disingeniuous confidence masking desperation. If anyone could make this work its guys like him. I for one am not the kind of person to approach perfect strangers with intent of peddeling dreams. I wish I could say that I hope this works out for him, and the other IBO's, but I honestly believe thier success will be at the expensive of other people's livelihood; this kind of financial burden has the potential to destroy families if a member is unseccessful.

If i had thousands of dollars and over a year tied up in this kind of investment; I would likely be one of the aggresive AMWAY defenders on this site. I can somewhat understand your predicament. I pray that if there is not a successful future in store for you, that God may open some other door and allow you refuge from what I perceive to be a stifleing dilema. I'm not posting to criticise your work, or dash your dreams; my heart is geniunely broken for those suffocating under thier own ambitions.

To the AMWAY advocates that have posted comments though civil discourse; Thank you!

Joecool; I'll never know how much heartache your website has spared my family and I; but, I believe it's considerable, and I am grateful.

Tuesday, June 1, 2010

Amway - 100 PV, An Artificial Defacto Quota?

Most LOS groups that I know of, use 100 PV as the benchmark when promoting the Amway business. Many groups also teach that you simply "change" your shopping habits and you can easily reach 100 PV. This teaching creates an artificial demand for Amway products and I believe that Amway sales would take a huge dip if not for this teaching. I also am of the opinion that for this reason, Amway had/has done little to reign in LOS abuses of downline.

100 PV is roughly equal to about $270 to $300 worth of products. Of course your cost may vary, depending on whether you purchase a lot of CORE Amway products such as laundry detergent, and nutrilte vitamins. For many people, the 100 PV benchmark is seen as the minimum for a business building IBO. The problem for many is that Amway products are no competitively priced, thus it is a hard sell. If I can buy the same or a similar product elsewhere for a fraction of the price, I will. And most consumers feel the same way.

It is why some LOS groups adopted the "buy from yourself and get others to do the same" philosophy. Since most people do not like selling, and because of the high prices of Amway products, simply telling prospects to buy from yourself made the concept palatable. The problem with buy from yourself is that it reaches the borders of being illegal, in my opinion. That is because in a buy from youself environment, the only way for an IBO to make a profit, is to recruit downline to benefit from the volume rebates. That is because there is no outside customers to bring in cash from outside the circle of IBOs.

What makes this issue even worse is when you have LOS groups such as WWDB creating an even greater problem with programs such as eagle. If 100 PV is an inflated demand for Amway products, incentive programs such as eagle make it worse. How can a single person reasonably be expected to move 200 to 300 PV when most of it is personal consumption? The upline leaders use these programs as an incentive for downline IBOs, but in turn, they benefit financially by having more downline volume, as well as potentially enhanced tools sales by dedicated downline IBOs.

I challenge any IBO or prospect to take a close look at your Amway purchases. Are you truly just changing your shopping habits and achieving 100 PV or are you buying things to give away, or buying things that accumulate somewhere? Unless IBOs are selling half of their purchases, they are probably overbuying Amway products. I believe it is simply because of upline teaching which creates a defacto 100 PV quota and an artificial demand for Amway products. I challenge you to examine this closely and make your own conclusions.