Friday, September 21, 2012

Why Amway Diamonds Appear Wealthy?

One of the things that many IBOs do not understand is where the upline profits actually come from. They think they will obtain passive residual income but most do not understand how it works or where the money comes from. What most people see instead, is a photocopy of an upline's check, or they may see upline driving a nice car or something like that. They do not understand how the business works and the fact that there are two businesses at work. The Amway opportunity and the tools business. Frankly, most IBOs would be much better off giving their upline a check for $50 each month and never getting involved in the Amway opportunity.


Upline earns some income from the movement of products. Amway returns about 32% of their gross in the form of bonuses. Most (active business building) IBOs earn 3% while uplines split up the remaining 29% of the bonus. Not such a great deal when you think about it. Also, most IBOs overspend on Amway products. They are not simply replacing what they normally buy. If they did, then there would be tons of former IBOs continuing to move 100 PV or more. Instead, when an IBO quits, they either buy nothing from Amway anymore, or they may use a few products here and there. The opportunity and the way it is promoted simply creates an artificial need for Amway products. If the products were so great, why then after 50 years of business, that IBOs sell less than 5% of their goods to non IBOs, making IBOs the primary and possibly the only consumer of Amway products?


Then you have the tools business where IBOs don't even get a measly 3% of the profits. Uplines keep all of the tool profits. While this may seem acceptable on the surface, keep in mind that the tools do not work. There is no unbiased evidence that I know of that suggests that the tools create a natural progression of IBOs. I cannot name more than a few new diamonds in the US since I left the business in 1997 or 1998. And even if there were some new diamonds, I believe there were even more who quit or left Amway for other reasons. One might wonder why a diamond would quit in the first place if there really was residual passive income involved.


So where does upline profits come from? Simple, it comes directly out of the pockets of downline. If IBOs actually sold products, then some profits would come from sales and customers. Instead, most Amway sales are simply made from upline to downline. And vritually ALL sales in the tools business comes from upline to downline. Thus many IBOs spend $500 to $600 a month on products and get back $10 if they reach 100 PV. Then you factor in the $150 to $250 monthly that IBOs typically spend on tools. Suddenly that cheap or no risk oppportunity doesn't sound so cheap. And try working it for several years and IBOs can easily rack up tens of thousands of dollars of expenses.


That where upline profits come from folks. Do the math, most IBOs truly would be better off giving upline a check for $50 a month and doing nothing else.

5 comments:

Anonymous said...

I would suggest all IBOs stop spending their money on tools.

Anonymous said...

I read on another site there were about 20 new diamonds annually. in the usa post 1997

amwayscam said...

I like that last sentence!

Anonymous said...

How can anyone use 500 dollars of products monthly. Even more strange is people agreeing to spend money on tools , an obvious rip off.

Anonymous said...

When I think about how the business seems to work as described here I find it hard to believe this was the intention. Nobody would have believed you could organise a business as follows. Produce products at a price/quality level which the public won't buy but IBOs will buy 10 times more than their needs AND sell worthless tools to people losing money every month. AnD it works. So if people are prepared to do this then it is not surprising they sign up for the plan as it is shown.