Thursday, March 31, 2011

Reaping and Sowing?

One of the things that many prospects and IBOs believe is that they will make an investment of time and money into Amway and that they will eventually get their time and money back in such abundance that they can walk off their jobs, and walk the beaches of the world while living on lifelong residual income, all because of the Amway opportunity. For IBOs and prospects of Amway, I wonder if any of you can actually name even five people who have actually accomplished this? Keep in mind that there have probably been tens of millions of people who also wanted this and tried Amway and the systems, only to find that reality paints a different picture.

Many people they will reap what they sow. While that many sound true, I guess the next logical question is what are you sowing? Are you deceptive when prospecting people to see the plan? Are you having to justify and hide price comparisons that are not favorable? Are you actually selling goods to customers and actually qualifying for your Amway bonus? Do you have a negative opinion (broke losers) about people who don't join Amway or are not interested in seeing the plan? Do you now think your boss and your job are evil? Do you leave your kids at home to attend endless numbers of functions and meetings? You reap what you sow correct?

I wonder what some WWDB diamonds were sowing? At least the ones who had their homes foreclosed, and one in particular was involved in chapter 7 bankruptcy proceedings? Are they reaping what they sowed? What about the WWDB diamonds who got divorced? What were they sowing? Are IBO sure about wanting to make the claim of reaping and sowing? And yes, Joecool the person also has his own flaws, but the difference is that I am not on stage proclaiming to be flawless and many diamonds would imply when they speak (and profit from) their tens of thousands of downlines. I am not earning a living by deceiving people and profiting from people I am supposed to be helping.

Are you reaping what you sow?

Wednesday, March 30, 2011

Amway and Spring Leadership Functions

I read about this topic on another blog and was inspired to write about my experience with Spring Leadership. I attended a leadership function as an IBO and I remember it quite well even though I've been removed from Amway for some time now. The leadership function was where the upline diamond would have all of his new leaders (platinums and up) speak. Kinda makes me wonder how this function is going these days when it sure doesn't seem like a lot of new leaders are emerging, at least in my old group.

These new leaders would talk about their trials and how they stuck to the system and now they have arrived. Some of them spoke about how they were able to retire their wives who now stay at home to care for their children. A noble task indeed. I had thought this was the great part about the business. It might interest my readers to know that not a single one of those leadership speakers from my IBO days are at the platinum level and in fact, all but one or two of these nice folks are even in the business. My former sponsor was a platinum and he is one of the few holdovers from the old days, but he is no longer at the platinum level. Last I heard, he was somewhere around 2500 PV, which means he is likely operating at a loss if he is still dedicated to "core".

Spring leadership is the beginning of a run of functions that can really bankrupt IBOs. I'm from Hawaii and leadership was held in March, followed by family reunion (summer conference) in July and Free Enterprise Day (FED) in October. All of these functions are held during peak travel times, thus IBOs who need to fly to functions pay a premium price to travel. Sadly, there was no visible significant growth in the groups after these functions. Looking back, the major functions were just quarterly paychecks for the upline diamonds. If you do the math, you can easily discern that these diamonds may have made millions for a weekend of speaking and showing off their "diamond lifestyles".

I hope this information can help a prospect or an IBO to understand how some of these things work and allow for informed decisions to be made about joining Amway or for deciding whether or not to attend that next function. IBOs need to honestly assess their risk versus reward in making these decisions.

Tuesday, March 29, 2011

IBOs Keep On Paying?

One thing that appears to be common amongst IBOs is how IBOs are in denial. They truly believe that their uplines are working in their best interest and that upline wants their success. I don't believe that to be true. If uplines were truly making a fortune from Amway, why would an downline IBO have to pay for practically every bit of help they get from upline leaders? Why aren't any functions pro bono? What difference would it make to someone making millions heaped upon millions?

To show the plan, you would need to pay to attend an open meeting, and pay for your guests, even if they do not register as a result of the presentation. You pay for voicemail to communikate with your upline and downlines. You pay for standing orders and you may end up paying twice if you were in attendance at the function when the standing order was recorded. You pay for books and other materials as well.

What's more, many IBOs turn their heads when ugly facts rear their heads. For example, some IBOs deny that a prominent triple diamond was involved in bankruptcy proceedings. They continue to edify and pay for financial advice from someone who could not even manage his own finances. They believe that Amway saves marriages even when the leaders who speak this may be getting divorced. It's like upline simply revises history and downlines buy it without question. Many IBOs do not even see it as a problem that some upline boldy lied and said there were no profits from tools in the past. I find this odd because tool profits are still shrouded in secrecy and downline simply believe that they will eventually get a cut, even without a written compensation plan and agreement.

I believe too many IBOs are simply in denial. They give upline their trust and upline abuses it. IBOs are told they are successful for attending a function even when they might be losing money month after month. They may be told that the Amway business is not about money but about making friends. They may be told that they are nicer people because of their participation in Amway. What too many IBOs do not see is that they are in denial about their business. Most IBOs are losing money, a little at a time, perhaps $100 or $150 a month. For the hardcore, maybe more. But they are taught to ignore these simple facts and deny that there is a problem.

It is my hope that exposure of some of these tactics will be beneficial to information seekers and perhaps new IBOs who have not yet been fully indoctrinated. I encourage people to ask tough questions, demand answers and use due diligence when checking out this oppportunity. The fact is that very few people every make a profit and people should know this before getting involved. In the end, IBOs pay up and they keep on paying upline for their sage advice, even when their bank accounts keep getting lighter. Where will it end?

Monday, March 28, 2011

There's No PV In Watching TV?

One of the things our upline constantly taught us was there is no PV in TV. They advised the group tp avoid Television, the newspapers, and other forms of media. This cult-like tactic was apprently their way of having us avoid any negatives that could affect our thinking. As if IBOs didn't need to learn of any news. IBOs don't need to learn about issues, afterall, your upline will tell you what to do and how to vote. Looking back, you gotta wonder how in the world your upline would know what was going on in the world if they were following their own advice?

It is true that there's no gain in PV for watching the televsion, but then again, IBOs engage in many things that doesn't result in gaining PV. Attending a function, or listening to a standing order doesn't get you any PV either. Hanging out with your upline or attending a night owl doesn't get you PV. If PV was the priority of IBOs, they should be pounding pavement selling products or making contacts with potential buyers. Instead some groups teach that selling is not required or the famous "buy from yourself" technique of running a business.

In fact, IBOs spend so much time in non income producing activities, it's no wonder that most IBOs end up with a net loss after business expenses are considered. What's worse, IBOs run their businesses on the internet but in most cases, it's against Amway rules to advertise their products on websites such as ebay or craigslist. Instead, IBOs employ the least efficient means of working their business. Person to person, one person at a time. For many, the only way to increase PV volume is to sponsor downline. Even many IBOs who emphasize selling, seem to rarely have more than a handful of regular customers. But what can you expect when your means of increasing business is person to person, one at a time? There's a reason why advertising during the superbowl has a heavy price, because tens or hundreds of millions of people see your message all at the same time. IBOs go person to person, one at a time.

Wednesday, March 23, 2011

Amway Goals?

One of the things that you may be taught as an IBO is to have a goal. While having a goal in a good thing, I believe the context in which it is taught by Amway leaders is misleading. They want to motivate you to "go diamond" or perhaps some other achievement in the Amway business, but there is no specific means to achieve these goals and frankly, I do not believe that many IBOs or prospects understand what they are pursuing.

For example, one way that diamond leaders try to motive their downline is to show displays of wealth. They may show fancy cars, or talk about the mansion they own and paid for in cash, or they may show you a fancy vacation or jewelry. All the while, these diamonds may be up to their ears in debt. Has a diamond ever showed anyone a copy of their bank account balances or a business tax return? While IBOs may claim that this is noone's business, I beg to differ. In the REAL world of business, these are not uncommon practices. A close friend of mine who recently sold a franchise business not only gave copies on his bank statements, but three years worth of tax returns to the eventual buyer of his business. It was to verify his claim that his business was worth buying.

So for IBOs and prospects, what is your business goal. If it's to make $500 a month, has your "mentor" actually sat down to discuss this and to map out how this can be accomplished? What about setbacks? In the Amway business, the Amway reputation is damaged, thus achieving certain tasks may be much more difficult to conquer than you are led to believe? Is your upline actually helping your individual cause or are they simply leading you to purchase more tools? If your goal is not diamond, are you receiving the same help as others in the group?

The big question though, is are you progressing towards your stated goal and are you on schedule to accomplish the goal and reap the rewards, or have you fallen into a trap of attending meetings and listening to standing order and accomplishing nothing? If you have stated goals, there should be tangible and measurable ways to assess your progress (i.e. profits). If your upline starts to feed to rubbish about being a nicer person or that Amway saves marriages, then your upline may be leading you astray.

Monday, March 21, 2011

Your "Realistic Chance Of Success"?

One thing that many Amway promoters don't like to talk about is what your realistic chances of success are. I will define success as Diamond because that is what the outcome of the 6-4-2 and 2-5 year plan. Of course you may be able to earn some income at lower levels, but my understanding is that diamond is where the real money from Amway and the tools start rolling in. And I can also understand why people promoting Amway do not discuss your realistic chances of winning. Afterall, lottery promoters do not show you the millions of losers, they only parade the winners in front of you.

Many people, including Amway enthusiasts will agree that many IBO do little or nothing. Some people never even place an order or make any attempt to do any business. For the purpose of this article, I am not speaking about these folks. I am talking about people who actually put in some effort to the business.

For many people who want to make an earnest effort, they will purchase and hopefully sell a few items with the goal of reaching 100 PV. For that effort, you will receive approximately $10 from Amway and whatever profit you might have earned by selling products. Here's the catch. You will likely need to pay website fees in excess of the $10 you earn from Amway. For the more dedicated IBOs, you may be payin for voicemail, standing orders, book of the month, and possibly attending functions. These expenses will exceed your income month after month unless you are able to increase your volume by selling enough products and/or sponsoring downline who buy and sell products.

Because Amway has to include the IBO bonuses in their prices, the products come at a premium price. Thus sales to non IBOs are relatively low. Without sales to non IBOs, the only other way to generate more volume is to sponsor people who will buy and sell products. But due to past unethical IBO behavior, getting people to see the Amway sales and marketing plan may be a challenge. Also, most IBOs are unable to sponsor a single downline.

Some Amway enthusiasts will claim that if you do their CORE steps for 2-5 years consistently, that you are likely to succeed. Sound easy, but becaue of the factors I have identified, some of these steps are impossible to do consistently. It's not like walking a mile each day where you have control of the step. People will likely fail in showing the plan and sponsoring others because they cannot find enough people who are willing to see an Amway plan. Many, possibly most other IBOs can and will do certain steps consistently such as listening to a CD daily and reading a success book. But because of a spotty reputation in the US, IBOs will very likely fail to be able to show enough plans to succeed.

Your realistic chance of success? My informed guess is less than 1 tenth of 1 percent. That's the likelihood of going diamond. Your chance of going platinum? My informed guess will be less than 1/2 of 1 percent. If you think you can beat those odds, go for it. For most people, it might be wise to look into other opportunities.

Friday, March 18, 2011

Why Do Upline Leaders Get A Pass?

I remember my upline telling our group to trust them. That they had our best interest at heart and that they would never lead us astray on purpose. These were in the larger settings. In our smaller meetings such as with our platinum, we were told we should check our egos at the door and submit to upline. By submitting to upline, we were showing strength and not weakness. By doing this, we would grow our business faster.

Sadly, many IBOs, including myself, really did trust our uplines and we did what we were told. We showed the plan, we attended the meetings and we did the core steps. While I did make some progress with a growing and excited group, I was not making a net profit. The tools ate up all the profits, even though I had a 4000 PV group. My downlines were all losing money because of the tools and the travel. I also did not see any prospects of improvements even at the platinum level as I would have had a couple of additional functions such as go diamond weekend and I would have been expected to fly to show the plan for distance groups.

So while there are rare and few and far between successes, why do uplines blame their trusting downline for failures? Why do the leeaders have no responsibility for the failure of their downline? They certainly take credit for the few successes. I say that active downline should ask their leaders to be responsible for their actions. If their advice causes damages to their downlines, perhaps downlines need to hold these leaders accountable? Don't give them a pass.

Thursday, March 17, 2011

Is Amway A Scam?

The short answer is no. Amway the company is not a scam. However, IBOs powered by Amway and/or leaders from groups connected to Amway such as WWDB, BWW, or Network 21 can end up scamming people by using the Amway opportunity as a front. They'll promote Amway as a way to earn a lifetyle of the rich and famous. They may promote Amway as a means to earn lifelong financial security. The catch will always be that you need to follow their system.

The system normally consists of cds, voicemail, standing orders, books, functions and seminars. Some of this technology is outdated, but likely has not changed in many years because uplines profit from the sale of these "tools". It's basically a bait and switch. They lure you in with the hopes and dreams of a fabulous life and uncoutable cash rolling in. They then sell you the secrets of gaining these trappings. Sadly, only a tiny fraction of 1% will ever see any kind of significant success. And out of those who do enjoy some significant success, many of these people find out that Amway success may not be sustainable.

The truly horrifying result of all this is that probably 99% or more people who have dreams of a better life and financial security will actually end up with a net loss of money and time that they could have used more productively. In my IBO days, I saw some crossline lose their homes or enter bankruptcy following the advice of their trusted upline mentors. It almost always had something to do with skipping out on financial obligations in order to buy more tools or to attend a major function. The secrets of a diamond lifestyle is apparently to sell standing orders, functions, voicemail, not not necessarily selling Amway.

If you look at the arnings of platinums and diamonds, you will easily see that thos kinds of incomes cannot sustain million dollar lifestyles, especially when you factor in business expense such as traveling and hotel stays. If diamonds fly first class everywhere they go, that's a lot of cash to run their businesses.

So is Amway a scam? No, Amway the company is not a scam, but Amway IBOs and Amway IBO leaders who run functions can certainly scam you. Beware!

Wednesday, March 16, 2011

Success = Control Of Time And Money?

One of the big things that the speaker hit on when I heard the plan was time and money. He said because of the job, you may have money, but not enough time to do what you enjoy. He went onto say that if you have no job, you may have a lot of time, but you'll be broke and won't be able to do what you enjoy. He also said that controlling time and money is essentially financial freedom. This concept appeals to many and makes sense in the big picture of life. Afterall, who wouldn't want to retire early and have enough cash to travel the world and only do fun things? I certainly agreed with that concept. The only problem was that I initially thought I could achieve this through Amway.

The sad reality is that nearly ever single IBO who registers for the Amway opportunity and the tools system, will never realize this dream. An Amway recruiter may paint a nice picture of how simple the business is, and that you can simply buy products and get others to copy or duplicate you and before you know it, you will be in control of time and money, and live "happily ever after". At one time, I believed it myself. Many others also bought the lie. What's worse, the secret to achieving this was contained in standing orders and functions. Another lie.

The more likely case however, will be that the business, including the system of cd's and functions, will cause you to have less time and money. In general, the Amway (and partner store) products costs more than your local big box retailers, and the cost of the systems add up to at least several hundreds of dollars per month if you are "CORE". Thus ironically, what many seek more of, they end up with less of, because of the business and the related activities. The functions and other educational materials take up valuable time and resources from the IBO and rarely ever results in any kind of significant return on the investment. Most IBOs would be better off never getting involved. In fact, many IBOs would be better off writing a check to their upline for $100 a month and not participating at all.

Time and money, think about it. Are you getting more or less of it because of your involvement in Amway and the systems?

Tuesday, March 15, 2011

What Is Your Amway Business Worth?

Many many people see the Amway plan, sign up in the hopes that Amway income will help them fulfill their dreams and that they will walk away from their jobs and collect lifelong residual income while walking the beaches of the world while living in the lap of luxury. Sadly, most IBOs will never make a profit or even sponsor a single downline. These IBOs may continue in the business for a while but will eventually quit when they see the writing on the wall. Unfortunately, many IBOs suffer a financial loss before they realize what's happening and walk away. Some IBOs, if they stay active for some years, could lose tens of thousands of dollars in the end.

But wait, you're an "independent business owner". So instead of quitting, why not sell your Amway business? I wonder if any IBOs actually think about what their business is worth. A diamond, in theory, could either walk away and collect income, or sell their business and live happily ever after right? Here's some food for thought. Why are there any instances of diamonds quitting or resigning from Amway? Why would they just quit when they could either walk away and collect an income "forever" or sell the business? Maybe there is no residual income. If many IBOs do nothing and many do not renew after a year, how can you keep volume moving month after month? You can't.

I believe diamonds quit and resign because their business is worth very little or nothing. And most Amway businesses do not even generate a net profit. For IBOs who are seriously pondering on this very important message, try looking up this topic in Amway's rules. There are very complicated steps to be taken when selling your Amway business as each person upline must be offered ownership (To the best of my understanding). This process can go on for a long time and the attrition of your business could render it worthless before you can find a buyer, if you have a buyer at all. Also, if you quit, the downline in your group would be surrendered to the immediate upline anyway. So why would your upline want to buy your business? They could just let you quit and inherit your business, afterall.

Also, as an Amway business owner, what do you own? You don't own your downline, although their volume runs through your business. You don't have staffing and you probably don't have equipment or a rental property or any bonafide assests. You may or may not have some inventory but you are not required to hold any. So what really is the value of your business? What is it worth?

So IBOs, I ask you. What is your business worth? What is the value of your business? I'll guess it's worth little to nothing......

Monday, March 14, 2011

Getting A 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 once 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.

Sunday, March 13, 2011

IBOs "Giving Back"?

I get a kick out of uplines who talk about donating $5000 or $10,000 checks one day when you go diamond. They talk about giving back to the community. It's all fine and dandy, but overall, what do IBOs give back? Most dedicated IBOs end up with a net loss of time and money because of their dedication to the system and therefore, have less to "give back".

I'm sure some IBOs and leaders make the time to give back, but I would bet that many refer to delayed gratification when this issue is raised. In the past, some diamond's financials became public record due to unforeseen circumstances and not once did I see the large monetary contributions they speak of. You'd think double diamonds would be giving hundreds of thousands of dollars since they imlpy that they live million dollar lifestyles in functions.

Think of this food for thought. Your local church is better off with you giving a couple hundred a month and helping to feed the homeless than to get nothing until you go platinum or diamond. As an IBO, I was guilty of this also. I thought I could provide a lot when I achieved emerald or diamond. I didn't think anything about not helping during my IBO days though. I was too busy working the business and my funds primarily went to product purchases and tools and functions.

I believe that most IBOs have good intentions and want to give back and help. But I also believe that upline advice in many cases will sap their ability to do so because of tool and function purchases. That's what is so insidious about certain upline leaders. They only care about their bottom line but give their downline the impression that they care about them and want them to succeed. For example, if it's true that some downlines were advised to attend multiple Dream Night functions, what are the uplines doing other than draining their downline's bank accounts, something they are supposed to help enhance.

Some IBOs might give back, but what are they giving back?

Saturday, March 12, 2011

Amway - Put It In Writing?

Here's something that IBOs can use when they see upline leaders making claims and guarantees of sorts about the system. Ask them to put it in writing and to ask what they are guaranteeing? It's easy to stand on stage and say the business is simple or a piece of cake. That buying tools and attending functions nearly assures success. Ask your sponsor or upline what exactly you will receive if you do what they advise and the results are not there?

Uplines will always use an out - that you did not do everything exactly and precisely as they advised, therefore any failure is your own fault. I find it humorous because these leaders are quick to take credit if they see any downline success. It's like playing a game of heads I win, tails you lose. The upline always has a built in excuse. This wouldn't be so evil if they uplines weren't making their fortunes out of the sale of tools and functions.

In fact, speaking of writing, have you ever seen a formal tools contract indicating how you qualify for and the compensation that will be received when you qualify? Why do platinums, as far as I know, get only a cut of the standing orders and not anything else? Why are some of these issues such dark secrets? It's like the legend of Sasquatch. Many have heard about it, some have claimed to have seen it, but there's no bonafide evidence of it's existence.

Amway supporters like IBOFB (David Steadson) decry my blog because it may deter people from joining Amway. But at the same time, who's held accountable to people who were deceived or lied to about Amway and joined only to lose money, regardless of the amount of effort they expended. As an example, my former sponsor spent over 17 years in the business hard core. I wonder what kinds of losses he suffered as a result of his hard work and sacrifices? He was involved before I was and back then, WWDB leaders completely lied and denied that there were any tool profits.

Upline making incredible claims? Ask for their guarantees and assurances in writing. But you won't get any.

Friday, March 11, 2011

Amway - Knowledge, Skills and Abilities?

Many IBOs and Amway supporters adhere to the idea that their system works. As far as I know, there is zero unbiased evidence that the system works. The system generally consists of a website, voicemail, standing orders and seminars or functions, as well as meetings to show the plan, etc. While Amway supporters will claim that nearly everyone who succeeds is on the system, they won't mention how everyone who succeeds also has hundreds if not thousands of downlines who do not succeed, even with earnest effort in building the business using the stsem.

Edward O. Thorpe was a math professor at M.I.T. who studied and wrote a theory on Blackjack, and found that it was mathematically possible for a blackjack player to have an edge over the house in a game of blackjack. Casinos scoffed at the theory and said it was just that. A theory with no real life application. Well, Mr. Thorpe started playing small and found that his theory was correct. He was counting cards in blackjack and making consistent money. His book eventually became a best seller. The casinos were ticked off and started kicking out people who were obviously winning and counting cards. Counting cards is not illegal but casinos can refuse to allow a player on their premises. But what casinos did not notice right away, was that their profits were skyrocketing because so many people knew the theory but could not or were not capable of executing the card counting system.

But hey, the system works so everyone should count cards for a living right? Afterall, it is proven by math that the cards will eventually favor a player and in the long run, you can make huge profits from playing blackjack. Of course not, it is ridiculous for people to think that card counting is a good way to make a buck. Not everyone has the bankroll, the skill, and the patience to succeed in card counting. Most people are better off not even trying this.

In my informed opinion, this card counting system is just like WWDB, BWW, LTD, N21 or other Amway systems. For one thing, card counting is a proven system. The Amway systems are not. But it can be viewed as similar in that very few people can use the system and make it work. Even when hundreds of thousands may try it, very few will succeed in both Amway and card counting. In both "systems", those who do not succeed can lose thousands of dollars. In both systems, doing things right can still result in losses.

In both systems, it is "possible" to succeed, but it is highly unlikely. The vast majority of people simply do not possess the knowledge, skills and abilities to make the systems work for them. You also need some money, some patience, and some luck in order to be a long term success. This article is not about comparing the Amway systems to gambling, it is about a person's ability to make the system work. The difference is that nobody promotes card counting as a good way to make a buck. The same holds true about Amway and their systems. It is not a good system to make money.

Thursday, March 10, 2011

Amway Deceptive Recruitment?

One thing I have noticed recently is how many Amway recruiters cannot or will not recruit prospects by telling them the virtues of Amway. It appears that insulting people's jobs or lifestyles is a common recruitment tactic by many IBOs. They try to instill a fear in recruits to make Amway look good.

Common tactics will be falsehoods such as 98% of Americans are dead or broke by age 65. Or they will make up outright lies such as 95% of all small businesses fail in their first year. They talk about the bad economy, or how starting a conventional business is a bad idea because there is some start up capital needed. While a conventionl business does involve some risk, you have a decent chance of succeeding, provided you plan well, and put in the necessary effort.

Planning and putting forth effort doesn't necessarily result in Amway success. As far as I know, there is no evidence that standing order, or functions guarantee any degree of success in Amway. Sure, Amway defenders will state that all of the (few)new diamonds were on the system, but will ignore the thousands if not millions of IBOs who also were on the system, put forth effort, and did not experience a profit.

At functions, one things I remember seeing was the fabulous toys and lifestyles of the diamonds, but there was no mention that these toys and luxuries were made possible by tools income or other sources of income outside of Amway. I understand that AMOs now mention tools income, but do not elaborate as to how you qualify and what the compensation will be if qualified.

It is my informed conclusion that Amway recruiters lie - because they have to. The business is a tough sell because of past unethical IBO behavior, such as tricking someone into attending a recruitment meeting. Factor in the high overall prices of Amway and Amway partner store products and the pyramidal compensation plan and you almost cannot recruit people in the US without some degree of shmoozing and deception.

Wednesday, March 9, 2011

IBOFightback Exploits Amway IBOs?

I don't know why IBOFightback aka David Steadson and Tex aka Scott Johnson obsess over Joecool. They continue to post garbage about me and have made continued to mistakenly identify me by the name of "Steve". Tex is just an obsessive compulsive moron, but IBOFightback aka David Steadson has all of these Amway contacts and such, surely he could find out all the information he needs about a "Steve" who was in Amway under the Harimoto diamondship at one point in the mid 1990s.

IBOFightback entered the Amway debate regularly in about 2003. In the short time span he posted over 5000 posts on the Quixtar Blog Forum in about 2-3 years. He has been mostly inactive on that forum in recent years. Shortly after his arrival, he created many many blogs and his Amway related forums. He also posted his opinions and blog links on hundreds, if not thousands of related websites. He apparently doesn't build the Amway business with any regular and consistent effort, based on his own statements.

It is my opinion that IBOFightback aka David Steadson simply exploits his forum as a means to advertise and profit from IBO traffic to his website. I don't believe he has any other motivation or reason to defend Amway. His attacks on me are simply a way to sensationalize his stories and to drum up business for his websites. Ironically, I believe IBOFB's website traffic might be earning him some nice coins. And as I said, Tex is just an obsessed moron. IBOFB is likely in the advertising business moreso than the Amway business.

That's my theory and others are free to chime in.

Amway Success?

Success is subjective. Someone making ten dollars might be considered successful, for others, nothing less than a barrel of cash will suffice. One other important point is that there are undoubtably some very successful people in Amway. I am sure that some Amway diamonds are quite well off and enjoy some of the finer things in life. But the reality is that these successes are very very rare and many of these success apparently are not sustainable as many people are led to believe.

But the bigger issue in the Amway opportunity is where the success comes from. Sure, many people want to "go diamond" and live in luxury while barrels of cash roll in. But what is unknown to many, is that the few who enjoy the lifestyle and trappings do so at the expense of their downline. The downline move the volume and the downline purchases the system materials, both of which is profitable for the upline. Because Amway products, admittedly are not commonly sold to people who are not IBOs, then anyone can conclude that upline success comes from the pockets of the downline. Most downline would be better off writing a check for $100 each month to their upline and not participating in the business or buying products at all.

This in itself would not be such an issue if the system actually churned out new successes frequently AND if the downline were not led to believe that the system is the key to their success. But less than one half of one percent of IBOs ever reach platinum and out of those who do, only a tiny fraction of one percent ever attain the diamond level. But the business has tens of millions of people who tried and could never achieve what was promoted. Lack of effort may be a factor, but when that many people try and fail, it's evident that the system is flawed as well.

To summarize, it is possible for someone to achieve a level of success in Amway, but it is so difficult and so rare that IBOs probably have a better chance of winning the lottery or being struck by lightning than they do of achieving a significant level in the Amway business. Some people are successful, but it is usually at the expense of their downline. The catch is that uplines will teach their faithful downline IBOs that attending a function or buying a standing order is success, regardless of whether an IBO is earning a profit. So many IBOs think they're successful but they are simply fooling themselves with the help of their upline.

Success is undeniable, but sadly for the vast majority of IBOs, it is also unattainable, at least in the Amway opportunity.

Monday, March 7, 2011

Amway Motivational Organizations (AMOs) - Behind The Smoke And Mirrors?

This is a repost of an eye opening thread:

There is a book called "Amway Motivational Organization - Behind the Smoke and Mirrors", written by Ruth Carter in 1999. Ruth Carter was an IBO and also worked as an employee of a diamond. Her close and personal insight into the life and finances of a diamond is quite horrifying when you see the details. Based on my observations and years of blogging experience, I believe that this diamond as described in this book, is more typical than not. I believe this because this diamond had a nice income. but was living in debt. Basically the diamond in the book (not identified) lived a lifestyle to portray wealth, but behind the illusion of wealth was a pile of debt.

This diamond operated in the mid 1990's, the heyday of the AMO abuse. While Amway pundits will make claims such as the story is a bit dated, I still say the story is quite valid because not much has changed in the business. Yes, online shipping replaced the call in and pick up method of delivering goods, and for some groups, the voicemail system changed, but the diamonds in the business still portray vast amounts of wealth. My old LOS, WWDB, still has a function called Dream Night, where the diamonds parade around and show off mansions, sports cars, jet skis and other luxuries. The diamonds still make claims of buying bit ticket items in cash, and they apparently still have the nerve to teach that the Amway opportunity can save your marriage.

The diamond in the book had a nice home, a couple of fancy cars and a nice income. The diamond in the book had a gross income of just over 3 million dollars. But after business expenses, this diamond had a net of $323,000, with only $96,000 of the income coming from Amway. For the Amway defenders who like to cite religion and call Amway a God pleasing business, I will note that this diamond only had $10,000 of their income given to charity. This diamond had the fancy suits, a couple of nice cars and a nice home. This diamond also had a mortgage with little equity. The diamond had not paid their income taxes for several years and this diamond also had credit card debts in the hundreds of thousands.

How can someone who has achieved the Amway pinnacle of success be in debt? Simple, by portraying a illusion of wealth that cannot be sustained on the income generated by Amway volume and tools sales. An income of $323,000 is certainly nice, and more than most people will ever earn, but the lifestyle they live might require a multi million dollar a year income or more. Amway reports that the average diamond earns about $147,0000 a year. I might add that a diamond's monthly income may not be that great as much of the income of a diamond comes from annual bonuses.

So why do diamonds live a lifestyle that they cannot sustain? It is my guess that diamonds need to keep recruiting new IBOs in order to maintain what they have. Thus they portray an easy lifestyle with no job and tons of luxuries. Some diamonds show off more than others. But in order to entice prospects, you need to show things that most people cannot attain with a job. I believe it is why there have been other signs of financial trouble in diamond land. Other diamonds have had homes foreclosed. A prominent triple diamond was in bankruptcy (chapter 7) proceedings, and a host of diamonds were selling off mansions in a bad real estate market. The signs are there. You can believe your own eyes or continue to deny what appears to be the norm in this business.

Amway Motivational Organizations and their diamonds are creating illusions of wealth, behind the smoke and mirrors, I suspect many of them are in financial difficulty, living month to month and bordering on massive debts. The evidence is there. The question is whether or not you believe it. I recommend you purchase this book, which is filled with insight most people do not have about Amway. You can find it on

Sunday, March 6, 2011

Amway - I'm Free?

When I was an IBO, I often saw my upline diamond driving around town dressed in a business suit. I used to wonder why he keeps working if he can "walk away" and collect residual income? My sponsor told me that the diamond only works because he cares about his downline and wants to help them. So there are two possible scenarios, the diamond is working to help his downline out of a genuine concern for them, or possibly he is working because he has to! The only difference now is that the diamond works the nite and/or graveyard shift, because many IBOs are building the business after the complete their day jobs. This is probably why diamonds sleep until the "crack of noon", because they are working all night!

Now Amway has stated that the average diamond earns about $147,000 a year. That is a decent income, but after yaxes and paying for basic expenses such as medical and dental insurance, the average diamond probably lives a very middle class lifestyle. Keep in mind that a large portion of a diamond's income comes in the form of an annual bonus, thus a diamond's monthly income may be quite small. Yes, diamonds may have other sources of income such as speaking engagements and income from standing orders and functions. But this income depends on the diamond's continued appearances and efforts.

So is it likely that a diamond is "free"? I would have to conclude that a diamond is not free, and may actually have to spend more time maintaining his group than if the diamond simply had a 9-5 job. For one thing, a diamond needs to maintain a personal group to keep qualifying for bonuses. With a poor retention rate in Amway, I am fairly sure that a diamond spends much time recruiting personally sponsored IBOs to maintain this group. Additionally, a diamond must help his six or more groups of downline platinums to maintain their businesses or face the possibility of falling out of qualification. My former diamond dropped down to the emerald level but has since re-qualified at diamond. A diamond must also dedicate time to reward up and coming movers and shakers, to keep them motivated. I got to spend time with my upline diamond when I was considered a promising up and coming pin.

In order to continue to receive tools income, a diamond must also travel to numerous functions and speaking engagements. Although the tools income allegedly doubles a diamond's income, it also adds a lot of expenses, especially if the diamond and his family travel first class to show off the diamond lifestyle, and stays in 5 star hotels. It is probably why diamonds need free transportation to and from the airport and why they stay with friends when traveling as much as possible.

After breaking down projected income and considering projected expenses, I can only conclude that a diamond probably lives a middle to upper middle class lifestyle, and probably works as much as a man with a 9-5 job, except that a diamond works nites and weekends. A good portrait of this is shown in Ruth Carter's book (Amway Motivational Organizations: Behind The Smoke and Mirrors). In the book, the diamond had a net income of over $300,000, but lived in debt, could barely pay his mortgage, and was always on the run from one function to the next. It is very expensive and time consuming to travel from city to city showing off your freedom and diamond lifestyle.

Is this the freedom you are seeking?

Friday, March 4, 2011

Amway Is Fair?

One of the bogus things my upline taught us was that the Amway opportunity was fair. That it was a completely level playing field. On the surface, that sounds right because "everyone starts at zero". While everyone does start at zero, the compensation plan is unfair to those who "do the work" and in my opinion, should be revamped so lower level IBOs make more money. It would probably help with IBO retention and maybe, some higher level leaders wouldn't have to work so hard to keep replacing people who quit.

If you are a new IBO, then you might not be really familiar with the Amway compensation plan. Amway pays out about 30+ percent of their gross as bonuses. Thus if you move 100 PV in goods, or about $300 in sales, then Amway pays out about $100 in bonuses. You as a new 100 PV IBO, would receive about $10 and your uplines, some of whom don't even know you exist, will split up the remaining $90 in bonuses. It truly is not a case of doing the work and getting paid. You are doing the work so upline gets paid. To add insult to injury, upline wants you to purchase materials that tries to convince you that this is a good deal.

And something very significant to think about. In what other sales profession are you compensated so low (3%)? I can only think of real estate, but in real estate, your sales are likely in the hundreds of thousands of dollars. In just about any other sales related profession, you get a much higher cut than 3%. Yes, your bonus or comission can be higher if you move more volume, but then you are likely receiving more money because you are now exploiting people doing 100 PV who get only $10 back.

Even after you consider the unfair compensation, you must factor in the cost of tools. Most uplines promote tools (cds, voicemail, functions) as vital to an IBO's success. Some uplines push the tools harder than others. But the tools purchases will often be the primary cause of IBO financial losses because the cost of tools will normally exceed an IBO's bonus. It is very common in the US for monthly tool purchases to exceed $200 a month on average, and very very few IBOs will ever reach a high enough level in the Amway compensation plan to earn enough just to break even. Also, the tools apparently do not work. There is no unbiased evidence to suggest that tools have any causal relationship to IBO success.

With Amway's spotty reputation and the unfair compensation plan, IBO retention is spotty. Many IBOs sign up and do little or nothing, and many IBOs don't even last a full year before they quit. What happens is IBOs begin to figure out that recruiting downline is next to impossible and therefore, generating more volume is nearly impossible, even for individuals with skills. If you are a new IBO or a prospect, I encourage you to sit down and really look at the math and factor in the cost of tools. There are many ways to earn a dollar, I just don't feel that Amway is an efficient way to do that.

Thursday, March 3, 2011

Your Upline's Lack Of Credentials?

I recently read a comment from an Amway zealot. She mentions that someone's credentials must be considered when looking at information that is presented. I will comment that showing me a sports car or a fancy suit is not proof of financial success. Strange how they question credentials of everyone except their beloved leaders, some of whom told bold faced lies in the past.

I find this subject ironic because not one single upline leader, as far as I know, has ever supplied bonafide credentials about themselves. The audience assumes that the person on stage has high credentials, but do they really? Certainly, if someone is wearing a diamond pin for example, that this person has at least achieved the diamond level as recognized by Amway, but the level may not be current, and the level doesn't indicate the kind of income this person earns from Amway. Also, the diamond pin is one that is like a lifetime achievement, meaning you could have been diamond for 6 months in 1982 and never qualified again, but you can still wear the pin as you are still recognized as having achieved diamond status. I guess Joecool should be refered to as 4000 PV if that is the case.

What many people wrongly assume is that the diamonds buy homes and cars in cash, that they wake up at noon every day and participate in leisure activities all day while the cash rolls in. I have heard from some new IBOs, that their upline makes more money taking a crap in the morning than a critic makes in a whole year at a job. That IBO became quiet when some critics offered to take that bet. I doubt that any diamonds would take that bet.

But the truth of the matter is that as far as I know, only former diamonds have come clean about their Amway income. They are the only ones who spoke of credentials and accomplishments. Even critics of Amway will often openly speak about their experiences and achieved levels in the business. In the REAL business world, showing business tax returns and credentials are a normal part of doing business. It appears that only in the world of Amway is the supply of credentials and financial statements a big secret. Now I am not suggesting that IBOs or upline leaders should disclose their financials to the entire world, but certainly prospects and some downline should be able to see what their upline is doing financially, especially if that is the basis for purchasing their standing orders and function tickets. And I refer to business (Amway and Tools) income and expenses only, not from other personal sources.

I believe that IBOs and upline leaders do not disclose that information because it would not be beneficial to them. If it were, they would likely publish it freely, just as they flash around copies of checks. IBOs and prospects should take this to heart and ask upline the tough questions

Wednesday, March 2, 2011

Saying Farewell To Amway?

I was browsing the Quixtar Blog Forum recently and came across a thread where a long time contributor to the forum had stated he was "retiring" and leaving the group. Those of us who remained active on the blog wished him well. One Amway defender who uses the handle of "Captain Amway" left a comment mentioning that this long time contributor leaves the group and only a measly 6 or 7 people wished him farewell. Of course, Quixtar Blog was a highly popular blog/forum some years ago and membership has gone down. Critics who retired had much more fanfare in the past.

I later thought about the 6 or 7 people who wished him well and had a thought. What happens when someone leaves Amway? More often than not, the person who becomes a "former IBO" goes from winner to loser. People claim the person has lost their dream. They are now bitter or failures. It was their own fault for not succeeding. They did not work hard enough or didn't have the intestinal fortitude to stick it out. They are now destined to be broke losers.

This mindset comes from upline teaching. They teach you that your job is bad. That you can only win or succeed in Amway and any other option you choose is a poor one. They want you to believe that Amway is your only chance to become financially successful. That without Amway and their teaching system, you are basically doomed to failure and despair. As proof of their own success, uplines will show you pictures of someone's bonus check, pictures of mansions and cars, and other luxuries. I guess if you don't ask, you may never know who actually owns those luxuries.

In the real world, if someone came up to you on the street and showed you pictures of jets and mansions and said they could show you how to obtain these same luxuries if you forked over $100 bucks, you would keep walking or laugh your way home. But oddly enough, when you see it at an Amway meeting, somehow you believe it? I'm guilty as charged. I once believed it but because I was fooled, I now share my experience through this blog as a way to provide information to those who seek it for their benefit. At least with information available, prospects can make informed decisions about joining.