Your Dreams Don't Have To Include Amway?

One of the things that many IBOs are badly misguided on is the concept of dreams and fighting for dreams. A dream is basically a long term goal. Someone might dream about playing in the National Football League. To accomplish that dream, one might play high school and/or college level football. For most, the dream will end unsuccessfully. No matter how much someone wants to play in the NFL, only so many people are proficient enough to be able to make the team. Even fewer are elite players that become stars. So while you might fight for your dreams, there is also an alternate reality.

In the Amway business, via the "systems" such as WWDB or Network 21, the leaders will often sell hopes and dreams to the downline. That the downline can be retired at the age of 29, walking the beaches of the world while the income just rolls in forever and ever. These kinds of "dreams" would be the same as hoping to win the powerball lottery. You may have seen a few who did it but the chance of you duplicating it is very unlikely. Slim to none is your chance in reality.

Another things uplines will often do is tell anecdotal stories about crabs keeping each other in a bucket when one tries to escape, or about monkeys preventing each other from grabbing bananas at the top of the pole. While the stories may be interesting and even true, it doesn't necessarily apply to the Amway business. While it is true that an IBO may have friends and family who are skeptical about Amway, it is with good reason. Many people have gone through the Amway business with no success. Many people have lost money doing everyting they were advised to do by upline. There is a track record of financial disasters associated with Amway and the attached "systems". It's not like there's a long list of people who have walked away from Amway with the cash rolling in and not a care in the world. Ever wonder why none of the crown ambassadors have exercised the option to "walk away"?

I think people should have dreams. I think people should pursue their dreams. I also think people need to know that certain dreams can come true. There also needs to be a degree of reality in their dreams. There will always be some inspirational person such as a "Rudy" who overcame great odds to accomplish a dream, but the untold reality is that there were probably many many young men who dreamed of playing for Notre Dame that year. Likely, no one else accomplished the unlikely dream like a Rudy. What I am saying is that earning a nice income and having the option of early retirement can be acomplished in many ways. You might be choosing to use Amway to accomplish your financial dreams and that is your right. But the reality is that very few people have made all their financial dreams come true due to the Amway opportunity, as compared to the tens of millions who have tried.

Keep fighting for your dreams, but keep in mind that you might need a plan B and a dose of reality.

Go Platinum In Amway - Less Than A 1% Chance?

Many people consider the platinum level in Amway as a significant achievement in Amway. While it may be nice to achieve that level and gain recognition from the Amway corporation, I will point out that there was a study done in Wisconsin where the attorney general analyzed and found that platinums on average, lost money. The study is somewhat dated, but I will also point out that today, there are MORE expenses associated with running an Amway business than before. (Voicemail, books, functions, standing orders, shipping). I would guess that it's possible that platinums lose more today than when the Wisconsin study was done.

A typical platinum group often has 100 ore more downline IBOs. Also, there are many many IBOs who sign up and do little or nothing. Thus a logical conclusion is that less than 1% of IBOs can reach that level. It is also, apparently rare to maintain that level. My former upline diamond had 7 frontline platinums in his heyday. Actually, 6 of them were ruby level. None of them hold the platinum level today. So you have a less than 1% chance of reaching platinum and then you are unlikely to be able to maintain that level.

What serious prospective business owner would even consider opening a business where you have such a tiny chance of success? Even those who achieve platinum are likely to lose that level. If platinums cannot maintain their level, then it's easy to see why there are former diamonds as well. It seems that people are willing to take a chance on an Amway business because the start up cost is low. But what is the point of doing all of that when the chance of making money is negligible?

To compound the problem, many IBOs spend a lot of time and money building an Amway business that is unlikely to give them any return on their investment. I'd guess that the average serious IBO would spend $250 a month of more on tools. That money invested over a number of years in mutual funds would give you a much better chance of achieving some dreams. Even putting the money in the bank would make you better off than the vast majority of IBOs. A serious business owner would want to know their realistic chance of making money. For some strange reason, prospects and IBOs seem to ignore this reality.

It is because uplines are in the business of selling tools and distributorships. They are not truly interested in your long term sustainable success. If you don't believe me, try to stop purchasing standing orders and function tickets and see how much longer you are edified and given help from upline. Seriously, would a real business owner be interested in a less than 1% chance of success?

Opposing Views On Amway Not Welcome By IBOs?

One of the things I find curious and humorous at the same time is how people who defend Amway often will not allow opposing viewpoints on their Amway propaganda blogs and forums. They will post an article and allow no comments or will not allow comments unless they are positive and paint a rosy picture about Amway. Amway's biggest defender IBOFightback, banned me from his truth about amway blog recently for no reason. In fact I posted only a handful of comments there in years and the comments were truthful and not attacks, yet he felt my presence needed to be excluded from his blog perhaps because the truth itself is negative about Amway. I suppose though, that David Steadson's (IBOFB) lack of credibility (in my book) makes the banning a minor issue. His website is filled with pro Amway folks who back up Amway, even bad practices at times. I guess when you see the world through rose colored glasses. you don't see the reality.

I also had an exchange not too long ago with an IBO via email. He also runs a pro Amway blog but hasn't been active recently. He doesn't allow comments on his blog unless they praise Amway. I just don't understand why the need to put spin on the truth. It is a fact that the average Amway IBO earns very little and that most IBOs make little or nothing. Many who participate in the training sessions end up losing money. Those are tidbits that match up with my experience. It is usually former IBOs who can verify this claim. Seems that current IBOs do not admit they are losing money. As an IBO, I was taught "fake it till you make it". That suggests that you appear successful until you actually go diamond or whatever. In the end, a pig with lipstick on it is still a pig.

Joecool allows opposing views on this blog. Even some comments that are critical of me are allowed. I even had some (I presume) IBOs who left threats on this blog. I suspect that one or some of them also sent me threats via email. Still, I allow most comments on here. I do not allow racist or extremely hateful comments, or comments with spam. I have nothing to hide when it comes to my views on Amway. So what do Amway apologists and IBOs have to hide? Would it be damaging to have the truth on your blog or forum? Is the internet already inundated with negative Amway information and comments?

I believe Amway is partly to blame. The AMO's (Amway Motivational Organiztions) such as Network 21, WWDB or BWW are the ones who say and do unethical things. Amway is the only entity who can take action against these groups but it appears that substantial action is lacking and therefore, these groups continue to teach bad business practices which filter down to many IBOs and contributes to Amway having a bad reputation. I guess Amway is sleeping in the bed they made. Until some bad practices are stopped or corrected, there will continue to be people who had a bad experience in Amway. It is what it is. Amway started an accreditation program to curb abuse but that practice appears of the surface to be a paper tiger (no teeth).

Amway Wolves In Sheep's Clothing?

The really insidious part about some of the LOS leaders, such as the ones I had in WWDB, is that they apparently are cutthroat ruthless businessmen with nice suits, and disguised as your mentors and friends. They get you to trust them, and they will tell you that they have your best interest at heart, or that they would never purposely lead you astray. On the surface, you may think this is true, but look at their actions and you can easily discern that some of these uplines are absolutely ruthless businessmen who would take every cent from you if they could. I was in WWDB and I have good reasons to believe that they are still doing this, based on a WWDB IBO blog. On this blog, I see much of the same teachings today, that I heard as an IBO and some of the same claims such as buying homes in cash, Amway saves marriages, etc. It's scary.

As an IBO, the diamonds would tell you to never miss a function, ever. The only good reason for missing a function was for your own funeral. I recall some crossline IBOs rearranging pre-planned anniverssary parties, weddings, and other special family events in the name of being core and attending all functions. Some IBOs actually did quit their jobs to attend functions and they very well may have done so because some uplines taught this. IBOs were also encouraged and told to go into debt to attend a function. This was okay because it was an investment into your business.

Our group was also strongly encouraged to buy extra cds every week. To be core, you needed to listen to a cd each day and you cannot listen to the same one each day right? Couples were told to buy their own seperate standing orders. Brad Duncen even had a true north tape (cd) that said sponsors were to eat the standing orders for downlines who quit because it was too much trouble to call upline who calls upline who calls upline to cancel a standing order. Oddly enough, they didn't mind upline calling upline calling upline to add a standing order.

In the end, I was lucky enough to have been progressing up the pin ranks so my losses were not that devastating. I ended up losing in my early months of the business but mostly broke even when I was at 4000 PV. Sadly though, my crossline did not fare so well. I know of one couple who declared bankruptcy. I don't know how much their WWDB involvement contributed to bankruptcy, but I am certain it was a major factor and I know of two couples who had homes foreclosed, and I believe that their allegiance to WWDB was a factor in those foreclosures. But I guess hey, two WWDB diamonds had homes foreclosed so maybe they were duplicating?

Do not be fooled. The diamonds may have a nice smile and a nice suit, but they are ruthless businessmen who will take your last dime if you allow them to.

Amway And Tools?

One of the things my upline always pushed on us was the tools system. While the tools are optional, they are not promoted that way. They were promoted as vital, necessary, almost as if you were insane to try and build an Amway business without tools. Basically the tools were a defacto requirement. My upline always claimed that nobody ever "made it" without tools. Some Amway defenders like IBOFightback insist that the tools work, and that IBOs who were on the system proved it with higher levels of success and product volume.

IBOs participating in the system (voicemail, book of the month, standing orders, functions, etc) do more PV. I believe this is true, but it is true, only because once the upline can convince you to participate in the system, then that same IBO is also convinced that they should or must do 100 PV as part of the deal. People who aren't convinced that the system is vital, subsequently do not purchase or sell as much PV because they have not been convinced that moving PV will make them successful.

Critics and Amway supporters have debated this issue for years, but clearly, the evidence supports my position. Why? Because if there was a true demand for Amway products because of their quality and/or value, then there wouldn't be such a steep dropoff in movement of volume when an IBO becomes a former IBO. Many, probably most former IBOs never buy a single Amway product once they leave the business. If the products had true quality and value as Amway supporters claim, why don't people continue to purchase 100 PV per month when they quit? Because they never wanted or needed all of that product in the first place?

If someone is convinced that Amway will be their financial savior and that by using tools and moving 100 PV will result in longterm financial security and residual income as claimed by upline, then that is what they will do in hopes of achieving the end goal. When that goal or dream doesn't materialize, the former IBOs realize that the tools and products no longer have the value they once thought thet had. How many former IBOs will buy standing order or attend functions? If these materials really made you nicer, or saved marriages, why don't any former IBOs keep buying them? Why do they resort to selling them for pennies on the dollar on Ebay or Craigslist?

Bottom line is that the tools don't work. They only work for the uplines who directly profit from the sale of tools, plus the artificial demand in product sales created by those IBOs who are convinced that Amway wil make them rich. Once the reality sets in that Amway will not make them rich, and that the tools are simply draining their resources, then the demand or tools and Amway products disappears almost instantly. There is no unbiased evidence that I know of to suggest that these tools work, and basically, the miserable amount of new diamonds emerging in the US seems to confirm this fact.

How To Profit In Amway?

I have been reading some ongoing debates about whether the system income for higher pins is more than their Amway bonuses. I believe the systems such as BWW, WWDB, N21 or LTD, does generate more profit for upline than the sale of Amway products. How the system income is divided though, is still a mystery as it doesn't appear that there are bonafide written contracts explaining how tools income is split up among the higher pins.

But it's very easy to determine that more income is made from the system than from Amway. If you move $100 worth of Amway products, Amway will pay about $33 back in the form of bonuses. These bonuses will be split among the Amway IBOs (middlemen), depending on your level. On the other hand, if your group bought say 20 cds at $5.00each, the system will profit about $90 as cds cost about 50 cents each to produce in bulk. Some Amway apologists will cite the fact that some groups sell cds for $2.50 or $3.00. While this is true, there is a "member's fee" which must be paid. And when you add in the member's fee, the profit for the system is the same or possibly higher!

If you buy a major function ticket for $100, the cost of that function might be in the neighborhood of $25 to $30 per attendee, so the system may generate $70 profit on a $100 sale. I believe the smaller functions such as open meetings, books and voicemail have smaller profit margins, but still overall, it's easy to conclue that the profit from the system is greater than profits generated by moving Amway products.

The only question is how much each individual earns. I have "heard" that platinums get a discount on the sale of standing orders and cds, but I have never heard of a platinum sharing any profit for functions, voicemail, or any of the other materials. This is puzzling to me as I believe the platinums do the most work in the system.

So for the lower level IBOs, if you move $300 in Amway sales (Approximately 100 PV), you will receive about $10 or 3% while upline enjoys the rest of the $90+ in bonuses from Amway. And then when you purchase and move tools volume, you receive nothing and some of your uplines enjoy all of the profit. While I don't see any problem in upline making a profit for selling training materials, I see a problem in the fact that the tools don't work. So few IBOs progress to levels where an actual profit is earned. Amway supporters will point out the new platinums emerging each year, but do not mention the platinums who do not re-qualify.

Based on my observations, I can only conclude (quite easily) that there is substantially more profit from the sale of support materials for upline to enjoy, and I can also conclude that the support materials are ineffective in training downline IBOs so they can progress to higher levels of the business.

What's "Likely" In Amway?

One thing Amway promoters and enthusiasts like to do is to paint a best case scenario when promoting Amway. I can't blame a promoter for wanting to show the best case scenario, but in my informed opinion, it's a matter of whether there is deception or outright lies in displaying that best case scenario. For example, when other "financial" gurus air their infomercials, they have a disclaimer to explain that success testimonials are a "unique" experience. Many Amway promoters apparently do the opposite and make it seem as if financial success in Amway is the norm and not the exception. But what is the more common or likely experience for an IBO?

I am not going to discuss the IBOs who sign up and do nothing, even if this may be common. (That's because there may also be reasons for this, such as deception or harrassment used by the recruiters). IBOs who sign up and do nothing do not tend to complain about their results.

I believe that for many, they will see the plan, usually the 6-4-2 plan which is to show how you can become a platinum and then diamond. The speaker may slide in how all you need is six of these groups and you will be a diamond and make hundreds of thousands of dollars and walk the beaches of the world. You can be job optional and wake up at noon, etc.

The reality for many is to sign up full of excitement, and thinking that certainly, some of their friends and family will agree that this is viable. So the new IBO will buy or consume 100 PV and may try to sell a few items. Eventually, this same IBO will talk to family and friends and many of their friends and family will show sour faces as they already had, or know someone who had a questionable or bad experience with an Amway IBO. I myself got tricked into a meeting at one time. They may listen to the standing orders and attend the meetings with the intent of succeeding as per the plan.

But after a few months, not many people are interested in registering, not many want to buy the products and it becomes increasingly harder to make contacts and to get new people to see the plan. The expenses start to add up. You have products such as laundry detergent or LOC that you don't need to replace but you have your defacto 100 PV quota, so you end up buying other things to reach that all important 3% bonus bracket. By now, you have a cache of household products and goods that you never really used prior to Amway, you notice that your checking account is shrinking as the products and the other expenses such as voicemail and functions are starting to add up.

You finally quit, in some cases with the now former IBO feeling embarrassed or ashamed that they even got involved in all this. They disappear and all of their former "lifelong" IBO friends could care less. They won't bother to complain about their experience, but may feel the need to vent if someone discusses Amway again.

In the final analysis, the bad experience and financial losses likely came at the hands of an AMO such as Network21, WWDB or BWW, but the attachment of a bad experience will be tied to Amway. This is a more likely experience than someone quitting their job to walk the beaches of the world.

Amway Millionaires

I keep hearing from some IBOs that they belive that Amway has created more millionaires than any other company in the US. I call BS on that claim. I am not saying that Amway hasn't created any millionaires, obviously, the Amway owners are worth billions of dollars. But what the IBOs are apparently implying is that the diamonds are millionaires. I'm sure there are some diamonds who indeed are millionires, especially if they are tenured diamonds, in particular the double diamonds and higher. But conversely, I believe that many high level diamonds are not millionaires. I believe it is just as common for a diamond to be in debt as it is for a diamond to be living large. I also believe that many diamonds did not accumulate their alleged wealth exclusively from Amway.

The reason why this is an issue is because these big pins will stand on stage and show off excessive wealth and imply that it is their Amway income that pays for these mansions, sports cars, and in some cases, jets. In the US, I attended a function called "Dream Nite" where these kinds of trapping are displayed, to the tune of the song "I wanna be rich". The diamonds would say that you can have what they have, if only you will do what they advise. These functions still go on today and I believe it is now called Winter Conference.

Stanley and Danko's book, "The Millionaire Next Door"
http://www.personalfinanceplaybook.com/2009/08/the-millionaire-next-door/

This book makes some very interesting points which I believe applies to Amway diamonds. I will outline the significant ones and I will comment below:

**Predictably, the data shows that most people who you believe to be very rich are not.

**High net worth individuals, statistically, tend to be people that live within their means. They don’t spend a lot of money. They don’t waste money. They tend to be pretty frugal people.

**The authors point out that most of the richest people you know aren’t driving expensive luxury automobiles. That’s what the people who want everyone to think they’re rich drive.

Joe's commentary. The book does say that about 1/3 of millionaires acquired their wealth thru a J-O-B and saved and invested, but did mention that many millionaires were also business owners, such as a pest control company, etc. But based on the points made by the book above, I can see where it is likely that diamonds portray a wealthy lifestyle as a recruitment tactic, when the reality is they may be living very middle class lifestyles off stage, or may even be in debt. I have seen evidence of diamonds having their homes foreclosed and being in debt (Ruth Carter's book: Amway: Behind the Smoke and Mirrors). Recently, there was also a report that Triple Diamond Greg Duncan filed for bankruptcy. The report indicated that he could not make his mortgages, or something to that tune. Odd, because when I was in WWDB, some of the upline leaders said diamonds paid cash for everything because paying interest to the bank wasn't very smart.

My question is why IBOs continue to make up these claims? Try googling millionaire or Amway millionaire. There is nothing to indicate that Amway was responsible for creating the "most millionaires" of any US company. If this were true, wouldn't Amway state it on their website? If someone finds any veracity about this claim, inform me and I will post it.

What Amway Prospects Might Need To Know?

When I was an IBO, my upline used to advise us to recruit people who had a financial need or young people who were open minded as they may not have preconceived ideas about Amway. When I was recruited, I was not where I wanted to be financially as I was in my 20's when I first got recruited by my sponsor. I believe that this is still common practice today, to look for people who are in need and then offer Amway as a solution. Sadly, Amway and the tools systems will more likely become a problem than a solution for the vast majority who try.

In my opinion, this is why some people defend Amway so fiercely. They accept Amway as their solution for long term financial stability and to admit that they were in error is difficult as it would not only expose the error, but would leave the IBO as not having that "hope" of long term financial freedom. It's hard to admit you got fooled or scammed and some people will dig in and press on, hoping that success will eventually come. Hope is a powerful thing after all. However, for most, it is false hope that is pitched in recruitment meetings and functions.

Many prospects see big dreams when the diamonds parade on stage with designer suits and talk about waking up at noon and enjoying a lifestyle chock full of luxuries. It's almost like dreaming about hitting it big in Las Vegas or winning the lottery. I can't fault prospects for wanting some of these things. I know I certainly had some of these same dreams when I was an IBO. The problem is that Amway is highly unlikely to be the vehicle that delivers these dreams. For most, a second job along with saving and investing will bring more long term success. The problem is that people don't like to wait for the long term and Amway is presented as a short cut to success.

The sad reality is that some (maybe most) diamonds are simply putting on a show, like a illusionist or a magician. Diamonds may indeed earn a six figure income, but after taxes and other expenses such as medical insurance, a diamond is very likely to live a very middle class lifestyle. Now I'm fairly sure that a crown ambassador type may have a million dollar income, but these Amway crowns are very rare, and the ones who exist have been in the business for a long time. There is not much chance of any new IBO coming in and achieving that level. In fact as time rolls on, it seems that more diamonds drop out due to divorce, better MLM opportunities or simply quit. It is apparent that long term residual income is a myth. Why do crowns seemingly keep working if they could "walk away" and live a life of luxury with no worries?

Amway reports that the average IBO earns $202 a month. I believe that number is also questionable as "most" IBOs (as shown in 6-4-2) actually earn more like $9 or $10 a month. Is this what you are signing up for? Don't forget about the ongoing expenses for tools and functions which results in net losses for most who get involved.

Amway prospects can benefit by knowing this before signing up.

Amway Complaints?

Over the years, I have seen literally hundreds (if not more) blogs and testimonials about Amway. Most of them decry the pitfalls of being an Amway IBO. Most of the complaints cite the fact that Amway in general has higher prices than comparable retailers and the fact that the system consisting of voicemail, books, cds and seminars ate up any profits the IBO may have made and resulted in net losses for most. One particular Amway apologist bemoans the fact that the internet is full of bad testomonials about Amway. The reason why there are so many negative testimonials about Amway is because over the years, thousands, possibly millions either had a bad experience for the reasons I cited above, or personally know of someone who had a bad experience.

Amway defenders will often cite the fact that many IBOs sign up and "do nothing" as their defense to this. But I will easily point out that I haven't seen anyone say they signed up, failed to do anything or order products, quit and started blogging about a bad experience in Amway. These defenders will also compare Amway to the gym where people sign up and "do nothing". Whether true or not, I also do not see people who sign up and "do nothing" complain about not receiving health benefits by simply signing up. It is a very weak defense. Conversely, I have seen numerous accounts of folks like myself who did put in effort, some for many years, who did what upline advised and did not see the financial rewards that is promoted in "the plan".

Amway defenders will then try to justify themselves, saying that the better business bureau (BBB) receives few formal complaints about Amway. I will agree with this. Many IBOs never bother to file formal complaints to the BBB or to Amway because in many, probably most cases, the person who quits and may have had a bad experience, was sponsored into the business. The sponsor was often a friend or family member of the IBO who left the business. Many will simply leave and forget the episode and chalk it up to a learning experience in life. Some will complain, but really have to ne venue to voice their remorse about joining. Some of us have found the interent to be quite effective in sharing our experiences and our opinions on why the business did not work. This is what one Amway defender calls the "internet war". What I have pointed out is that critics most often simply point out what the IBOs themselves have done. In many cases, the IBO is his own worst enemy. Afterall, critics didn't deny Amway and Quixtar had a connection, nor did critics make up claims about perfect water, etc.

It would appear that most of the problems has a root in the AMO systems, such as WWDB, BWW, LTD, or N21. Now, not all upline leaders are unethical, but it appears that many are, and new IBOs have no way to identify the good from the bad. It also appears that some of these upline leaders will issue bad avice. Advice that is detrimental to the IBOs, but financially beneficial to themselves, such as telling IBOs to never miss a function, or to buy more cds. In many cases, these unethical uplines do not care about IBO success, their goal is just to move as many support materials as possible, so they can fund their "diamond" lifestyle. Sadly, it is also apparent that the diamond lifestyle may be a facade in some cases. An illusion of wealth portrayed as a recruiting tool.

If you recognize some of these warning signs, ask tough questions of your potential sponsor and visit this or some of the blogs linked to this one for more information.

Amway - Wealth or Financial Disaster?

When I saw the Amway plan, it was presented sort of as a raod to riches. Yes, the presenter was careful not o say it was "get rich quick", but 2-5 years is relatively quick when compared with working 40 hours a week for 40 years as the business plan was shown to us. And while some exceptional people do achieve diamond, there is a trail of IBOs who suffer losses, some of them staggering. In our own group, I know of at least one couple who lost their home following upline advice, and another couple to ended up filing for chapter 7 bankruptcy. I must state that the bad advice leading to bankruptcy and foreclosure most likely came from upline leaders. I also know of a gal who quit her job to attend a function, faithfully following upline advice from WWDB.

So what is the experience of many CORE IBOs? I'm not talking about those who "do nothing", but IBOs who actually make an effort. Well, if they do their 100 PV, then they are spending about $300 a month and dedicated IBOs will typically spend about $200 a month on average for tools. This is for a single person. A couple or family would be expected to do more, thus spend more. So for these 100 PV IBOs, they will expend about $500 a month and get back maybe $10. Of course if they were not in Amway, they would still have some expenses for household goods, but not anywhere near $500 a month.

Over the course of a few years, these expenses add up and can become staggering losses. Hard core IBOs might expend even more. The only way a rank and file IBO can gain relief is to sell products (which is difficult given the prices and the Amway name reputation) or to sponsor downline who wil then suffer some of the losses for you. It would be my estimate that an IBO might break even at about the 4000 PV level. However, at 4000 PV, you might have 30 to 40 downline. The catch is that only about 1 in 5 IBOs manage to sponsor another IBO.

Over the years, I would suspect that millions of IBOs have come and gone through the Amway opportunity, and probably lost billions of dollars. But many of those who lose money think they are successful, because many upline will edify those who buy tools, regardless of IBO results. After a few months, if your group and PV are not growing consistently, it is highly unlikely that you are headed for success.

IBOs and newbies, are you on the road to riches or financial disaster? Keep in mind that a net loss is not success, despite what you upline mentor may tell you.

Is Amway A Real Business?

Many IBOs are taught to "buy from themselves". Although in some of these groups, retailing may be mentioned, it certainly is not taught in a serious manner. I believe it is because people in general simply are not comfortable with selling products. Thus the concept of buy from yourself makes the masses comfortable. What they do not realize is that they are simply loyal Amway customers and not running a business. As I mentioned in a previous post, in what business do you not have customers? It is why IBOs must ask themselves, are they running a "real" business?

For many IBOs, the focus of their efforts is on recruiting others. But why would someone want to join a system where they basically sign up to be a loyal customer and be a recruiter for other loyal customers? The pyramid like compensation plan is what drives many IBOs. Find enough downline and eventually, your downline will absorb the financial losses for you and will become the srouce of your income. I believe that the 4000 PV or platinum level is about where you as an IBO can find teh break even point if you are dedicated to the "system" consisting of tapes, cds, books, voicemail and functions.

Secondarily, in addition to signing on as a loyal customer of Amway, if you join a system and participate in standing order and/or functions, then you have also become a loyal customer of the "system". Sadly, many upline will push IBOs to keep purchasing tools regardless of the IBO's progress in the business.

So I ask the question again for IBOs and potential recruits. As an IBO, are you running a real business? Can you get a business loan using the 6-4-2 plan? Have you tried showing it to a loan officer? Can you cite BWW or WWDB as educational credentials when applying for a job or will you be laughed out of the room? For these very reasons, I can only conclude that many, possibly most IBOs are not running a "real" business. They are simply doing what their upline advises. These uplines are more concerned about selling their tools than they are about their downline IBOs. It appears that downline IBOs are expendable. They quickly become bitter, broke, or not having expended enough effort if they do not "make it".

So are you running a real business?

Defending Amway Against Critics?

Many companies have critics. Amway defenders are quick to point this out. WalMart may have hurt small businesses, maybe they don't have the greatest compensation. Microsoft may have faulty software or whatever. It's funny but I don't see WalMart or Microsoft employees writing on blogs and calling their critics losers, or acting like cyber bullies. Seems these bigger companies just do their thing and ignore criticism, yet these companies are very successful.

Corporate Amway Global has some blogs and they are mainly about Amway and Amway related stories, employees and the like.

But various IBOs have taken it upon themselves to defend Amway. Sometimes it has been done in less than ethical manners. For example, Amway biggest champion, IBOFightback, has been refered to as a cyber bully by more than one website, and has more blogs about Amway than Amway. His reason for so fiercely defending Amway is still a mystery because he said he is not compensated by Amway or Alticor, or by any motivational groups. He has admitted that he is not even active in building a business, therefore he is not making any significant money from the Amway compensation plan.

What makes this interesting is the tactics that IBOfightback and many of his fellow IBOs employ. They will attack the credibility of the critic or try to discredit someone by saying their experience is not valid, or their experience is too old to be counted, even when IBOFightback himself (apparently) hasn't done much in Amway since 1998. In some instances, defenders resort to shameless lies to defend Amway or product schemes such as perfect water, and then get mad when critics point out the antics. It appears that IBOs are their own worst enemies because IBOs themselves are guilty of most of what critics point out.

It is my informed opinion that many IBOs defend Amway because they were enticed by Amway upline leaders into believing that facts don't matter, that the dream is alive, that success is around the corner. Many IBOs see their $9 bonus checks and they have to justify themselves in order to claim success, to keep hopes alive that they will cross stage as a new diamond. To not defend their IBO bretheren is to admit failure. It is why much debate here is about IBOs analyzing their business and tracking profits and expenses. If IBOs are losing money and pretending to be successful, they are simply justifying their mediocrity and failure.

Amway Diamonds Are Financially Free?

When I was an IBO, I often saw my upline diamond driving around town dressed in a business suit. I used to think why does he keep 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, or possoibly 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.

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.

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.

Is this the freedom you are seeking?

So Where's The Money?

I find it humorous when so many IBOs talk about their anecdotal stories of success, or talk about how their system teaches a foolproof way of succeeding in Amway. Yet I have not seen a single IBO who was willing to describe their business structure or talk about how they progressed from zero PV into a profitable structure. Amway's biggest defender, IBOfightback is a good example of someone who can talk a good game but cannot back it up with evidence of any success in Amway. Back in my IBO days, someone who could talk a good game was a teacher, and not a doer. Many IBOs may have a good theory about how to build a business but evidence clearly shows that it is talk and not action. One specific example is how an IBO is supposed to find 20 customers who each buy 20 PV from an IBO. Amway's own numbers show that an IBO who can actually do this is rare or non existent. Less than 4% of Amway's products, apparently are sold to those who are not IBOs. IBOfightback sits in the quiet confines of his blog where his kool aid induced followers blindly agree with everything he says. Apparently, IBOFightback is all theory and no results. So I say - show us the money someone.

Based on my observations, most IBOs have a small business, unable to sponsor enough downline to move any significant volume. They faithfully self consume 100 PV and do most of the CORE steps, except for being able to consistently show the plan and sponsor downline. Why is this? It is because the Amway reputation is stained and getting people to see the plan is an enormous challenge by itself, not taking into consideration that sponsoring is even harder. If you are reading this blog and you can relate to what you see here, perhaps you need to re-think your business situation and ask your sponsor some tough questions.

Now this leads to another question. Other than flashing a photocopy of someone's diamond bonus or the like, has your sponsor or anyone upline actually showed evidence of a profit in Amway? If you asked, what response did you receive? When I asked my sponsor about profit, I was told it was "none of my business". I believe that someone who is asking you to follow their system, which is not free, should be tasked with providing this information. If your upline teaches submission to upline, even more so you should demand to see results.

If your upline or sponsor refuses to show you evidence of profit, it should send up red flags all over the place. Maybe, just maybe, the critics of Amway are onto something.

Why Amway Doesn't Work?

Breakdown of CORE and why it doesn’t work. Here are the CORE steps. Some groups may have variations of CORE, but this is generally what many groups use. CORE is what many Amway leaders swear is the key to success, but the results prove otherwise:

1 - Show the Plan (10-15 per month)
2 - Retail the Products (10 customers @10 PV each)
3 – Tapes/cds
4 - Books
5 - Functions (attend all)
6 - Accountability
7 - Counsel with Upline (Be teachable!)
8 - Buy 100% of your own products
9 – Communikate

Many upline will tell you that your success is nearly 100% guaranteed if you follow these steps for 2-5 years. Some Amway enthusiasts will tell you that 6 months of this activity will nearly assure you of a platinum level business. Certain steps are within the IBO’s control, such as reading every day and listening to cds, and attending functions. It is also easy enough to be accountable, counsel with upline, buy your own products, and use KATE (voicemail).

Here’s where an IBO’s efforts will break down. Showing the plan and retailing products. And remember, if you cannot do these steps then you are not considered “CORE” and your upline will likely tell you that it is your own fault and that you simply haven’t been CORE, therefore you did not achieve success. There is some truth in this but let me expose the system in a different angle.

Amway has a spotty reputation in the US. I don’t think anyone can dispute this fact. Therefore, for the vast majority of people, being able to show the plan 10-15 times per month is a nearly impossible task. If you are able to do this, you are a really good salesman or a good liar. In this scenario, the IBO is already successful, but not because of CORE, but simply because the IBO has the gift of being able to convince people into seeing the plan. But for many IBOs, they may contact hundreds of people and not be able to get anyone to see the plan. Even IBOs who follow upline advice on how to contact will probably not be able to show 10-15 plans per month. Thus this IBO, who is doing the work, will not be able to succeed. The system will blame the IBO, but the reality is that the IBO has too big of a disadvantage to overcome.

Secondly, with high prices (on average) and with a spotty reputation, most IBOs are unable to retail products. Amway itself has admitted that less than 4% of Amway products are sold to customers (non IBOs). Thus most IBOs are unable to sell products, therefore they are not CORE, therefore upline will blame the IBO for failure..

What if an IBO contacts 1000 people and cannot get 10 people to see the plan? Upline will claim that IBO is not CORE and therefore it is personal failure of the IBO. IMO, the only reason why upline can claim that CORE works is because in order to do the CORE steps consistently, you have to already be at a certain level of success. The vast majority of IBOs cannot and will never be able to reach that level.

That is the myth and the deception that many uplines will use to attract recruits. That each IBO can do the CORE steps. When only a fraction of 1% ever reach the level of platinum or higher, the numbers strongly support what is written here. Apologists are welcome to try and prove me wrong, but they can't. :D

Bad Advice From Upline?

We have had some really good discussion on this blog recently about how someone can build a business in Amway without abusing downline. I was an IBO in WWDB, and I was given really bad advice from upline. These uplines are still around and apparently still giving some of the same bad advice to downline. Having said that, I believe there are some factions within WWDB who may be operating differently. I contributor on this blog, James C. has explained in some of his comments, how he operates, contrary to the mainstream WWDB teachings. Thus I was inspired to write this post.

My sponsor and uplines were Harimoto, Wolgamott, Duncan. We were taught that Amway saves marriages, and that the rest of the world gets divorced. Ironically, I believe Wolgamott is now seperated and possibly divorced or in the process of getting divorced. Greg Duncan was touted for his financial acumen and told the audience that only stupid people took out loans, even to purchase a home. Then we find out he was in bankruptcy proceedings with interest only loans. This is just a side bar. I will further explain what other advice was given to rank and file IBOs.

My sponsor and uplines told us that we should never miss a meeting. Period. That missing a meeting was setting a bad example for your group. In fact we should always purchase extra tickets to meetings and functions as an incentive to bring guests. We were taught that in addition to standing order, we should be purchasing 5-7 extra tapes/cds each week. Afterall, you can't listen to the same recording each day if you are core. We were told that if you had downlline who quit, you could not cancel a standing order because it was too much trouble to call upline who called upline who finally reached Greg Duncan to cancel a standing order. I found it ironic that they NEVER complained about calling upline who called upline who finally reached Greg Duncan to ADD a standing order. Our group was also told that nobody made a cent of profit from the tools. A lie that nobody has ever been accountable for to this day. If selling products were ever mentioned, it was only so IBOs could earn money to buy more function tickets and/or standing orders.

Our upline also enjoyed holding meeting after meeting, AFTER the functions. Thus IBOs went home after 3:00 in the morning at times, even on nights when the job was waiting for them the next morning. Our upline also taught more tenured IBOs that money wasn't important in the business because we are friends for life. The group was taught that we could have our families skip meals in order to buy more tapes/cds. IBOs were told that they should NEVER quit, unless they give up on life as they would be doomed for financial failure.

This is some of the bad advice I heard from some WWDB leaders. These leaders are still around today and I believe some of this is still taught. What does your upline advise?

"Losers" Don't Join Amway?

One of the things that my upline taught, and I believe is still taught today in various groups is that winners join Amway and losers do not. Or that you were a winner because you were doing something to better your financial future and those who didn't were losers. or broke minded. Of course the upline who said this had no knowledge about those who were not in Amway. Some of them may already have been financially sound or may have been doing something to better their financial future. I'm not sure why these uplines, who promote "positive", had to resort to calling people losers simpy because they did not agree that Amway was the greatest thing since sliced bread.

In many games or sporting events, there will be someone or a team that wins the game and someone or a team that loses the game. Losing a game doesn't make you a loser and certainly, a team that wins the game would not say the losing team were losers. Can you imagine a pro football team's coach taking the podium after a game and saying his team won because the other team was a bunch or broke minded gutless losers? That would never happen, yet we see that frequently in the Amway/IBO world. The owner of Amway, Rich DeVos had once said in a recorded message that just because people do not agree with you (paraphrased) about Amway, does not make them losers and that IBOs should not call people losers.

In all of this, people's jobs are also criticized. That a job stand for "just over broke" or "jackass of the boss" and other blurbs. Many IBO's goals and dreams consist of ditching their job so they can sleep all day and live a life of luxury. Ironically, it is most IBO's jobs that continue to produce income so they can pay their bills and feed their family. It is also an IBO's job that funds their Amway and AMO expenses such as product purchases and functions and voicemail, etc. Without having a job, most people could not even join Amway or pay for any tools. Sadly, most IBOs won't make any money in Amway either, and will have to continue to work at their jobs. I do not believe that someone earning an honest living working a job is a loser. Ironically, the folks calling people losers are often not even netting a profit from their Amway business!

Yes, in this business or the sports world, there will be winners and there will be losers. The question is whether you are the one who is allowed to be the judge of who is and who isn't. I would also suggest that IBOs are completely shutting down potential future business by their behavior. What if I went to a store to purchase something but the item was not available on that particular day, so I don't purchase anything and leave. As I leave, the store owner says I am a loser for not buying something there. Will I go back? Very unlikely. If an IBO truly sees themselves as a store owner, all prospects should be seen as potential business, whether future or present. If your upline tells you that people not interested are losers, you should hand him a mirror.