Tuesday, December 22, 2015

Amway And Debt?

One of the things that many Amway uplines will talk about with their downline is debt. Many IBOs and prospects join Amway, hoping that Amway will help them eliminate debt, by providing some extra income. What many IBOs find out though, is that they end up more deeply in debt, not because of Amway necessarily, but often because of the pressure to purchase tools and function tickets and other Amway related business expenses. The really sad thing is that much of the additional debt that Amway IBOs end up incurring becomes profit for their upline, via tool and function purchases.

Eliminating debt on the surface, is a good thing. However, I believe that many uplines only want IBOs to eliminate debt so they can free up discretionary monies that can be channeled into tool purchases, which uplines profit from. So while the advice seems sound, it still ends up as a self serving piece of advice. If you are an IBO or a prospect, is your upline advising you to eliminate debt and then turning around and telling you to attend "all" functions? It doesn't make any sense at all to go into debt to build an Amway business that is supposed to be low cost and low risk. If you aren't selling enough products to pay for functions and other tools, then it's very likely that your business simply cannot afford to take on those expenses.

As a former WWDB IBO, I heard the mantra about getting rid of debt. It sounded good to me, but I was floored when the same upline told us it was okay to go deeper in hock if it was to further our business, or in other words, to buy more standing orders or to attend functions. I could not understand why it was okay to create more debt, but only if it was to "invest" in your business. If debt is bad, then functions and other tools should be cut as well, until the IBO can reasonably afford to participate in the system. Amway IBOs, in my opinion. should be using profits from the business in order to purchase tools. If there is no net profit, then that IBO needs to decide whether or not the tools are worthy of an investment. Even if an IBO has some profits, the IBOs should determine whether to bank the profit or to channel them towards tool purchases, especially if the tool purchase will turn a net profit into a net deficit.

Too many IBOs trust their upline and make initial and ongoing purchases of tools, and then continue to do so without seeing tangible results. I believe this is why IBOs are taught to trust and have faith. Or that success is right around the corner. It keeps an IBO going, even in the absence of results. Hopefully a post like this can bring awareness to IBOs and potential IBOs. Good luck to those who disregard this information.

12 comments:

Anonymous said...

Joe, you are absolutely right. The only problem is that you're thinking sanely and rationally, whereas most Amway freaks simply can't do the same.

If someone says to you "Going into heavy debt is OK if it's to build your business," he is telling a very clever lie which can fool many unsuspecting persons. Sure, going into debt to build a huge factory or an airport is acceptable for millionaire businessmen who know what the hell they are doing. But it is unacceptable for a small, private, inexperienced individual who is on a budget!

In other words, Amway uses a principle that applies to BIG business, but certainly doesn't apply in the same way to a SMALL business. The lie has a certain built-in appeal to people who want very much to think of themselves as "Independent Business Operators."

Telling some desperate little IBO that he has to go into massive debt to succeed in Amway is worse that a mere lie -- it's a viciously criminal act. Persons in up-line who tell this cruel and evil lie should be disemboweled with a serrated scimitar.

AMWAY MUST BE DESTROYED.

Joecool said...

It is sad. The prospects are lured with dreams and displays of wealth. Then they are told all that and more can be theirs if they will only buy into the tool systems.

The upline who hard sell this knowing almost all will fail is criminal and those who can do it have no conscience. It is for this reason I started this blog and continue to update it.

If I can help a few people here and there when they search for information, it's worth the effort to me.

Ray said...

I think it was Albert Einstein who said that the definition of insanity is doing the same thing over and over again and expecting a different result. That would be the Amway "IBO" who keeps throwing away their money. So sad that the government either cannot or will not put Amway out of business. Shoot it with a silver bullet and then drive a wooden stake through it.

Anonymous said...

The plan says you need to have about 10 customers. Any rational person should realise a business with so few customers cant be profitable and certainly cant support debt.

Joecool said...

I really wish the FTC would do to Amway, what they did to Vemma. Require at least 51% sales to people who are not distributors. Vemma is tanking.

Joecool said...

Yes, 10 customers will bring in some profit but not enough to sustain an actual business with actual expenses.

Anonymous said...

#1 rule of entrepreneurs. If you're gonna fail, fail fast, if you're failing, drastically change what you're currently doing. Too bad IBO's blindly dig a hole for themselves...

Twiggy

Anonymous said...

It sounds absurd to pay upline money and all you get is an advice that is ineffective, illogical and dangerous to your financial standing such as getting more debt to "invest" in a pretend business and using those losses to write tax refunds which is risky and dangerous because you can be audited for your "refunds" as your "earnings". Even a person with little education knows what is sound and logical.

Joecool said...

The upline are smart. They extract your money one cd at a time. One function at a time. You don't notice it right away in many cases.

Joecool said...

It's against Amway rules to offer the business as a tax shelter but I've seen Amway IBOs do this quite often.

Anonymous said...

Those buffoons in Ada, Michigan have no real control over much of the Amway down-line, especially the sections of it run by lunatics with a messiah-complex like Dexter Yager. Nuts like that pay no attention whatsoever to Amway's rulebook.

Joecool said...

And Amway looks the other way. Even David Steadson, AKA IBOFB, wrote an article that Amway awarded accreditation to some AMO on the same night a rule violation occurred during the function. A political issue I believe.