Friday, December 12, 2014

If It Looks Like A Pyramid?

Let me start out by saying that Amway is a perfectly legal company, and therefore I am not saying or implying that Amway is illegal. But I believe that the way Amway businesses are run, are like pyramids. In most groups, you will have the lowest level IBOs efforts and tool purchases being responsible for the upline bonuses and tools income. Many many IBOs are fooled into thinking that the ability to surpass your upline or that you don't get paid to recruit downline makes this a good deal. It's not. The money is basically flowing from the downline into the upline's pockets in the form of product and tool purchases with very little chance that a lower tier IBO will ever make it big.

Unless you have a very very rare group where actual product sales to non IBOs in sufficient to cover the costs of running you business, functions and all, then it is true that the lower level IBO's jobs are likely the source of income for the uplines. How many groups are like that? None that I have ever seen or know of. In fact, how often do IBOs even sell enough products to cover their expenses for even one month out of the year? The groups that teach "buy from yourself" end up doing the most financial damage to their groups because the downline's expenses are then covered exclusively from the downlines jobs, bank accounts, or drive the downline into debt.

I've seen and discussed group structures in forums many times and I can only conclude that tool sales wipe out what little profits/bonuses some of the downlines might receive. Only when an IBO is able to sponsor enough downline to absorb the losses for them will they finally breal even or make a little profit. I would guess that the 4000 PV level or platinum is where a dedicated CORE IBO would breal even and possibly start to make a real profit. But we also know that most platinum groups have 100 or more IBOs in order to generate 7500 PV. Thus we can also conclude that less than 1% of IBOs make a net profit. The only way IBOs can earn a net profit at a lower level is to avoid purchasing tools and to avoid paying for functions. Those who get involved in a system such as WWDB or N21 almost guarantee that they will have a net loss.

Sure, my job may have a pyramid structure with the CEO making the most money. But the difference is that in a company, even the lowest paid employee still receives a paycheck and has money at the end of the month. The same claim cannot be made by IBOs. For these reasons, I believe Amway to be a legal pyramid. IBOs and information seekers are free to participate, but I challenge them to sit down and really analyze their ability to make a net profit. In most cases, the analysis won't be favorable. If you are in the US in particular, you may have great difficulty in even being able to discuss "Amway" without getting strange looks your way from others. Good luck in whatever you decide.

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