One of the silly things IBOs say is how they need to be their own best customer. That a McDonald's owner would never eat at Burger King, etc. That is complete hogwash. While there is nothing wrong with supporting your own business, IBOs are blinded by the fact that their business produces nothing. They are simply middlemen distributors. Do you really think someone like Ron Puryear consumes thousands of dollars of standing orders because he (partly) owns WWDB, a for profit company that produces training materials? Of course not. When you purchase something from your Amway business, you make no real profit. Any "false" profit you see is simply money out of your own pocket moving to the other pocket. Yes, you may receive a volume bonus, but that is still just a lot of your own money being given back to you. Spend $300 and get back $10. If you can get enough people to follow you and move volume, your bonus will increase, but the increase then comes out of your follower's pockets instead of your own. That's why many consider Amway to be a scheme of sorts.
I know some business owners and they are never the best or sole customer of their own stores. Many Amway business owners are their only customers or their best customer. That simply is not how a business is run. Any REAL business cannot support itself by having the owners and perhaps the owner's employees as the primary customer base. For any business to thrive, you need customers and a demand for products. Without customers and a demand for products, you have no business. But some upline leaders still teach "buy from yourself" as the primary means of doing business. Other leaders may ask you to sell, but to focus on sponsoring others because they are hopeful that this will result in increased volume. Sadly, most IBOs will never sponsor a downline and many will never acquire a customer other than themselves.
It seems as though many IBOs think they are business owners but the reality is that they are simply glorified customers of their own business and of the system or tools business. Their only hope of making a profit is to sponsor others. In my opinion, this method of doing business is a pyramid because the only way to eventually make a profit is to sponsor enough downline until you can leverage enough volume to fimally break even or profit. An IBO with a real customer (and not buying tools) can make a profit by selling a single product. But many IBOs are not taught this because their upline makes a much bigger profit by selling their downline IBOs standing orders, voicemail, books and seminar tickets. Many IBOs do not realize that they are simply customers of Amway and of the upline tools system owners.
For people already involved or considering involvement in the Amway opportunity, you are highly encouraged to seek more information and to fully understand how a profit is made in this business. Simply seeing circles drawn oversimplifies the process as most IBOs never get close to finding six (6) like minded people. Even those who find six are unlikely to be able to retain them. Over time, the cost of the products and the cost of the training will start to add up and the losses will escalate. For real business owners, an assessment of profit/loss and return on investment should be done and if the return is not good, a real business owner would consider other options.
So are you a business owner or a glorified customer?
Ironically, Amway is a "business" in which most franchisees MUST fail in order for the company to continue in operation. They would collapse in no time without constantly finding new suckers buying in at the bottom to feed those hefty commissions to the top of the pyramid. And if even a small percentage of those new IBOs were successful and their downline was successful the pyramid would by now have more Amway distributors than the population of the earth. Then they'd have to put on their best cheap suit and drive their old broken down old car to the moon to find new prospects to grow the pyramid. Same thing with those pricey seminars, getaways, fifty cent motivational CDs for eight bucks etc. Heck, if Amway actually made money for its people they wouldn't have any reason to buy any of that rah rah crap.
ReplyDeleteSo true. If people actually made money, that would be enough motivation for most people to continue in the business. And yes, Amway makes money from the churn of IBOs as long as they buy a starter kit and a few products before they drop out and quit. You add that to a core of IBOs that get sucked in and you get billions in sale each year.
DeleteThat's right Joecool and another thing about these clowns is that they will tell you hurry hurry buy in now before this opportunity passes you by and then turn around and say Amway has been around for fifty some years so it must be good. So which one is true? Is Amway going to fold tomorrow or are they going to be selling that same snake oil tomorrow next year and fifty years for now? At least it's guaranteed the market for your Amway "product" will never reach the saturation point but that's only because nobody in their right mind buys it. And they will be still out there peddling those phony "franchises" to the unwary because there's a sucker born every minute.
ReplyDeleteThat's a good point. The Amway folks will tell you to get in right away. If the opportunity was half as good as it sounds, anyone could join anytime and it wuld be no problem to make money. In the US, I believe Amway is near saturation and the only thing preventing saturation is the fact that many people turn 18 years old each year.
DeleteI think one of the reasons Amway has not been put out of business yet is their awesome political protection. They have become virtually a wing of the Republican party. Don't get me wrong, I think the Democratic party is just as corrupted by money. It's not about party affiliation but rather about protection. The thinly veiled illusion of selling a "product" is no more than a front for an outright pyramid game that only keeps schlepping along because there's a sucker born every minute to keep feeding the beast. The object is to keep the "business" just inside the line of the law. But in this case Amway apparently has enough clout to move the line, not the business itself. Their recruiters are always looking for a few good dollars. If you have too much money and time Amway is happy to take both from you.
ReplyDeleteI agree. Amway has protection from some politicians. I think the Herbalife decision from the FTC could have repucussions for Amway but we'll see.
DeleteI like the Amway business model and so I'm going to do it myself. Do the same thing the founders of Amway did, that is. I'll start up my own pyramid as the Triple Gold Emperor Eagle or some crap like that. I start out at the top for free and allow you to buy in at the bottom for $$. And since I haven't been screwing people for over fifty years I don't have to hide my company name from prospects like Amway does.
ReplyDeleteSince I need a product to front my otherwise illegal pyramid scheme I figure it's only fitting to market lollipops. After all, my whole business is suckers selling suckers for me.
It's also symbolic of your downline. Suckers getting sucked dry. If you buy/sell enough of them from me I will start selling them to you as cheap as you could buy them at the corner store. Get five suckers to sell five suckers... Do that five times down and you would have a downline of over three thousand, right? I won't tell you, why spoil the fun, but you'll find out later that you only have a few suckers left that were not sucked on. Call them "inactive distributors". And you will have a pile of empty sticks that have been sucked dry. You can call them "your ex- friends" but as long as you can afford to pay me for it I'll let you attend meetings with other nice suckers and brainwash all of you into thinking it all makes sense.
Those who are at the top in Amway do so knowing they are basically ripping off their downline. It's sad
Delete