Saturday, January 15, 2011

Compelling Evidence Against The "Systems"

It is my observation that people who join Amway usually end up losing money in the end. They may get involved to make a few bucks or because they are mistakenly led to believe that they will become millionaires in Amway in 2-5 years. I know my sponsor convinced me that we would be millionaires in a few years. These folks who recruit new IBOs into Amway are often associated with a "system" such as Worldwide Dreambuilders (WWDB)or Network 21 (N21). These system promoters, often diamonds, may mislead the recruits by showing them pictures of mansions or other luxuries, implying that they attained these goods with their Amway business. In many cases, it is a deception, especially when we know for a fact that some diamond leaders who proclaimed that they only make cash purchases, had their homes foreclosed. Without the hype, I am sure there would be fewer sign ups. But what is the evidence?

It is simple. Amway reports that the average active IBO earns about $115 a month in gross income. This average includes diamonds and other higher end IBOs. I believe if you calculated the median, the average would be much lower.

But what makes IBOs operate at a loss is the system expenses. The system generally consists of voicemail, standing orders, cds, functions, books and other materials. An average business building IBO might spend an average of $250 a month or so on these expenses. Amway defenders like to decry the amount, but there are couples who would likely spend more and IBOs who must travel by air to functions would spend more. Single IBOs who buy only the minimum might spend a bit less. Some IBOs with abusive uplines might spend much much more than $250 a month on tools. I believe my former sponsor probably spent easily an average of $1000 a month on average. (I am from Hawaii so the average cost of functions is greater due to long distance travel)

Thus if the average IBO earns $115 a month but the same average IBO spends $250 a month on tools, the average active IBO is losing $135 a month, with lower level IBOs (i.e. 100 PV) would lose more.

Look at a group of 100 IBOs at 100 PV. (This is just a model). If a 100 business building IBOs average $250 a month on tools, they as a group would expend $25,000 a month on tools. Their volume would be 10,000 PV, or about 30,000 BV. This would generate about $7500 in bonuses per month. Thus this group spent $25,000 to learn and be motivated while the group splits up $7500 a month in bonuses. The platinum would get the lion's share of the bonus but most of the rest of the group will suffer net losses. As the group grows, the bonus may grow, but so will their expenditures on tools.

The only way the group can make money as a whole is to avoid participation in the tools altogether. The evidence is right here with simple math. The systems do not work because the cost of the system is likely to consume all of the Amway generated bonuses and more. I gladly challenge anyone to explain in detail how this post is not reflective of the reality of being in Amway and a system such as WWDB or Network21.

The facts speak for themselves.


Anonymous said...

A lot of attention, it seems, is devoted in Amway to sponsoring downline legs. So what, do you suppose, is the average number of downline legs that an Amway IBO has?

Joecool said...

In my experience, there were several "pins" that helped my sponsor become a platinum. I was at 4000 and there were some 1000 PV pins in the group. The rest were mainly downline with one leg or downline with no sponsored legs. Most IBOs never sponsor a single downline. I guess my personal sponsor and platinum was good at it. I think he sponsored over 100 downlines but never ever attained Q12 platinum and last I heard, he was currently at 2500 PV after 17 years of hard core dedication.

Anonymous said...

I'm always amazed at ambots who come to these sites and say, "It's not a get-rich-quick scheme. Geez, people, you have to be willing to work."

Now I realize these are the newest IBOs w/almost no time invested yet and they haven't begun to feel the incredible pressure to spend money.

Let's see now: the plan is a 2-5 years to diamond plan, is it not? How is that not get rich quickly?

Was it Ron Puryear or Bill Britt (someone from wwdb) who put out the grandfather of all CASSETTE TAPES titled 'Go Diamond in 2 Years.'

Hm..............get rich even quicker!

We were supposed to revere that tape. Honor it. Be beholdin' to it. And we were.

David said...

Joe: Where is Anon from Canada who accused you of being a crab and pulling everyone else to your level by stealing their dreams? Where is he/she? It's looks like I won't be able to learn those secrets to building a profitable Amway business....Darn!

Joecool said...

Here he is:

Rogers Cable ( IP address
Scarborough, Ontario, Canada

Anonymous said...

he got owned again! HAHAHAHAHAHAHAHA =P

trifling scumbag

Anonymous said...

amway is a cult.

David said...

Joe: Why isn't Anon from Canada just ripping us Amway critics and dream stealers apart on this blog? Where is he to set me straight on The Amway Opportunity? Come out Anon from Canada! Come out!

Anonymous said...

man, those crickets just keep getting louder and louder! lol

Anonymous said...

So let me answer the question I asked on the first comment on this thread. The average number of downline legs that an Amway IBO has is less than one. The formula is: (IBOs-1)/IBOs, where IBOs is the total number of Independent Business Owners in an organization.

This is why the dream to have everyone in Amway to have multiple downline legs will always remain just that ... a dream.