Wednesday, April 24, 2013

Getting "Paid" In Amway?

One of the major reasons why I think Amway is not such a good opportunity is because of the unfair multi tiered compensation plan. I have heard that Amway pays out about 30-33% of the gross to their IBOs, but I find it unfair in that you get rewarded for sponsoring people who move volume more than you do for actually selling products. I believe this is why so many IBOs are desperately trying to sponsor people and in some cases, deception and trickery is used in recruiting, which contributes to Amway's bad reputation. This also explains a lack of emphasis on actual retail sales of products to non IBOs. Some groups still adhere to the "buy from yourself" philosophy, which focuses on personal use and not on sales.

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

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

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

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


Anonymous said...

I would agree if the products were better priced. I dont think they are retailable in a repeat way. Hence spnsoring is needed whereby ibos think they are buying from their own store.

Joecool said...

Hence the term "buy from yourself". Some groups made up this theory because (IMO) the Amway products were not realistically priced to compete with retailers.

ExAmbot said...

"One of the major reasons why I think Amway is not such a good opportunity..."

Let's start with, that there's enough evidence that discounts scamway as an opportunity. It's not. Unless one is willing to lie, cheat, manipulate and be a phoney consistently and persistently.

While your proposal would put more money in the pockets of the lemmings it doesn't do the same for the owners and their close AMO cronies in the quantities they have gotten used to. So I don't think there's any willingness to make the changes nor make pricing market competitive. The AMO cronies are rewarded for their "lie, cheat, manipulate and be a phoney consistently and persistently" efforts as they result in huge numbers of customers for scamway, AKA IBOs.