Joecool Is On Vacation

To my loyal blog readers, Joecool will be traveling and walking the beaches of the world for the next couple of weeks. Guess what? I'm paying for it with my J-O-B income and not from Amway. I'll be visiting several different countries and taking in the sights and experiences.

I'll be checking in to publish comments occasionally but there won't be any new articles until after the first week of January. I'd like to take the time to wish everyone a Very Merry Christmas and a safe and Happy New Year!

See you all in 2017! Joecool out!

The Amway Systems?

If you are an IBO or being recruited to be an IBO, it is almost certain that you are being recruited by an IBO in a "system". Now the system will likely have a name such as Network 21, WWDB, BWW, LTD or some others. Most if not all of these groups or systems will claim they are the best, fastest growing, or the most profitable. Now we know that they all cannot be the fastest growing or whatever. Most if not all of these systems will advise their IBOs to participate in their system. The system generally consists of websites, voicemail, books, cds, standing order cds, seminars and perhaps other workshops. The pressure to participate may varyt amongst groups, but it appears that the more you participate, the greater the pressure placed on you. Sort of like the analogy of boiling the frog.

All of these system companies are for profit companies, and generally the profits go to the diamonds and higher pins who own and run these companies. Some of the system diamonds earn most of their income from the sale of these tools. Now these system promoters may tell you that the system is vital to your success and some may claim that you cannot succeed without them. However, these system companies profit from selling you these materials whether you as an IBO profit or not. These systems profit even if you work hard and still go broke. While the system owners may claim that all success is attributable to the system, the same claim can be made of an even greater number of failures. Even the IBOs who put in an earnest amount of effort have an insignificant rate of success, perhaps lower than 1%. It is easy to conclude this because many and possibly most platinum businesses will consist of 100 or more IBOs. The platinum level is allegedly where an IBO breaks even or starts to make a small profit. Factor in the people who come and go (quit) and it is easy to conclude that the vast majority of IBOs either make nothing or lose money.

When you factor in the system expenses, then the number of IBOs who lose money goes up significantly. Looking at the 6-4-2 plan or whatever version your group uses, the lower levels of IBOs will earn less than $50 in a month, with most IBOs earning less than $20 per month. These IBOs won't even earn enough to cover the cost of their voicemail. If an IBO is participating in all of the system tools such as functions, it is nearly guaranteed that these IBOs will lose money due to the system expenses.

My conclusion is that the system just does not work. There is no unbiased documentation that suggests that the system works. Sure there may be some biased testimonials, but that would probably be it. If you are an active IBO, you can easily see if the system works as there would be new platinums, emerelads and diamonds emerging frequently, but that is not the case. It seems Amway is declining in the US and therefore, any new success (pins) will simply be replacing former pins who fall out of qualification or those who quit. The system does not work. However, I also came to the conclusion that nearly all of these financial systems do not work, including real estate gurus, Kiyosaki etal. It is why when they show success testimonials, there is usually a diaclaimer saying "unique experience".

In most if not all of these systems, including the Amway systems, apparently success is a unique experience. My conclusion? The system is broken. The system does not work. Some people can succeed in spite of the system, but they do not succeed because of it.

The Amway Buffet?

In the Amway business, most active IBOs are advused to trust upline. To think of upline as a coach or a mentor. These upline mentors or coaches are supposed to have your best interest at heart and they will guide you to success if only you will be open to learning. Many uplines, including my former uplines used to coin the term "copy" or duplicate. If you can do that you will be successful. Even the simplest of people can copy. The upline may crack a joke about getting thru school by copying. Thus, many IBOs follow exactly what their upline advises them to do.

But then uplines turn the responsibility away from themselves. Many Amway defenders will also claim that downline should not simply follow the advice of upline. They may make a ridiculous claim that standing orders and functions contain advice that must be discerned. That information is like a buffet. You pick and choose what you need and discard the rest. If you are a new IBO or prospect, let me tell you that is a load of guano (crap) that is being heaped on you. Your upline is touted as having experience and wisdom in the Amway business, which is why you are paying good money for voicemail, books, cds, and functions. So why would their advice be something you pick and choose? How would a new IBO know what to pick and choose?

Imagine hiring a guide for a trek in the wilderness. The guide is supposed to be an experienced outdoorsman, perhaps an expert. So if he recommends that you eat certain plants or fruits, you trust that he is going to guide you right. Imagine eating something that made you sick to your stomach, only to have the guide tell you that he just points out plants and fruits and you have to discern which is good for you and which is not. You would fire the guide and tell everyone you know not to use that guide anymore.

But here we have these "systems" such as Network 21, WWDB or BWW that have been "guiding" IBOs for up to 20 years or more in some cases, and the number of diamonds are negligible. Sure there are many new platinums, but many tool consuming platinums have been found to be losing money or making very little money for their efforts. What's more, it would appear that Amway is losing ground in North America based on sales. One can reasonably guess that any new platinums that break are simply replacing the volume for a platinum that no longer exists or a platinum that no longer qualifies. My former upline diamond appears to have all new qualifying platinums from the time I was in the business and here's the kicker. My former diamond had 6 downline rubies. As far as I know, none of these rubies are qualified as platinum anymore, although I have heard that some of these are still active.

Uplines also program their downline to take responsibility for the failure. Thus you have IBOs who did everything that was asked of them, only to fail. Yet these IBOs often blame themselves for their failure. It is my opinion that former IBOs who did everything asked of them only to fail should file a formal complaint against their LOS with the better business bureau. Amway defenders like to think that a lack of formal complaints means that the system works when clearly, there is no unbiased substantial evidence to suggest that the system works. It looks like some succeed in spite of the system, not because of.

The catch in all this is uplines skirting responsibility for the outcomes of those they "mentor" and profit from. IBOs should ask if upline really cared about their success, why do you have to pay for any help that you receive from your upline diamond?

Sharp Amway Prospects?

One of the things taught to our group by upline was to recruit "sharp" people. And in general, I agree that many/most IBOs were sharp people. Most of them nice, motivated and wanting more in life. Certain Amway defenders wrongly claim that I am against Amway and IBOs to a degree where I am maniacal against them. I am not. I recall that most of my group and my crossline were mostly educated and had decent jobs. We all hoped to achieve the dream of walking away from our jobs and living in luxury. We got the idea that is was very reasonable and achievable if only we did as upline advised and immersed ourselves in the "system", which in my case, was WWDB. We were told that WWDB had much fruit on its tree and at the time I was an IBO, that appeared to be true.

However, we did not know that some WWDB leaders made significant income from selling us tools. You see, we were lied to and speakers at major functions told the audience that nobody made a cent from tools and that upline makes pennies only after you earn dollars. We know know that this is not true and that these speakers were lying. What's more, these leaders were never made accountable for their lies. They just revised history and acted like nothing happened. Sadly, many downline IBOs simply accepted the explanation and continued to buy tools. Currently, the WWDB tree is getting barren, with little "fruit". There are very few new diamonds from WWDB in the US, and some of their more apparently dynamic leaders have left WWDB to start their own systems. Thus it looks like WWDB is left with the same old tired speakers today, as the ones who were around prior to my involvement with Amway.

But what's puzzling, or maybe not, is why aren't there more successes if many, possibly most IBOs are "sharp" people? Surely large groups of smart and motivated people can accomplish much, but for whatever reason, they are unable to accomplish much in Amway and WWDB. In fact, many of these shapr people cannot sponsor a single downline and have difficulty in selling Amway products. After many years of blogging and analyzing the Amway opportunity, my conclusion is that Amway products are priced too highly and cannot compete with similar products on the open market. Sure, Amway defenders will cite quality or concentration as reasons why Amway is competitive, and in some cases, Amway is competitive, but the general public doesn't care, they just want cheap stuff and Walmart fulfills that need better than Amway. It leaves the majority of Amway sales being made to active business building IBOs. Apparently the artificial need to buy Amway goods disappears when the diamond dream disappears.

Also, the zany and sometimes deceptive behavior of past and some present IBOs gives the Amway name a bad reputation, making it difficult to get anyone to see the plan, and sponsoring becomes nearly impossible. It is for this reason, I believe Amway is growing in foreign countries and not in North America, where saturation has occured. When you factor in all of these variables, it is easy to conclude that large groups of sharp people fai is not because they are not capable, it is because the Amway opportunity comes with so many handicaps that even sharp people cannot overcome them. It is why so many former IBOs, including myself, ahve done quite well for themselves after leaving Amway. Did I learn some things about business while in Amway? yes, I did learn some things of value, but I also learned that I was lied to and deceived by WWDB leaders and for that reason, my blog continues......

When Do You Have Enough Amway Tools?

One of the things that many Amway defenders will claim is that too many IBOs do not apply what they are taught, thus they do not succeed. While I agree with this in principle, I believe that there are many many more problems with the Amway systems that have nothing to do an IBO's willingness to apply what they are taught. I believe the system just doesn't work and the IBO's end up shouldering the blame for a flawed system.

For the record, I will be referring to IBOs who actually make an effort to build the business. I know many IBOs do little or nothing, but that in itself is a whole different issue, probably stemming from deception in the recruitment process. But okay, let's look at the systems.

Voicemail. The voicemail systems used by many groups are not only expensive, but completely unnecssary. Most newer IBOs do not even earn enough money from Amway to pay for their voicemail, and frankly, in an internet based type of business, I don't see why email or skype or social media is not utilized, except for the fact that eliminating voiemail would be eliminating a profit center for many uplines. In fact, if voicemail must be used, why aren't IBOs using the Amway version of voicemail so IBOs can gain PV/BV? The excuse that KATE may be better doesn't fly because I'm sure Amway could make improvements to the system they have. But overall, email or facebook would still be just as efficient at no cost.

Standing orders. If you attend functions, why would you need an endless supply of cds or tapes? Most of these are recorded at functions anyway, thus upline is hitting you twice as you pay for the function and then get hit up for the standing order again. And how many standing orders give you specific and practical advice on running a profitable Amway business? I am guessing that very little practical advice is given on these standing orders. Why do you need a new supply every week?, except that it is a big profit center for upline.

Functions. If standing orders are so valuable, why do you need to spend money on functions, especially functions where airfare and hotel expenses are needed? Why wouldn't there be less major functions and more regional functions? If the true intent of these meetings is to generate IBO success, then shouldn't the IBOs be able to attend functions closer to home to reduce cost and to make them more accessible to the rank and file IBO? But keep in mind that major functions are a huge profit center for upline.

All in all, I believe that some tools have little value and they rarely teach IBOs sales techniques, and I also believe that tools are overpromoted in many LOS groups, to the financial detriment of many IBOs. If IBOs were made profitble in their first month or months of business, there would be less need for so much motivation. When do you have enough tools? According to upline, the answer is never. And that's because the upline makes a significant portion of their living from tools.

A Better Option Than Amway?

One of the humorous things that IBOs say on my blog is if Amway isn't such a great deal, then why don't we offer a better solution? I guess it's just not enough that there are facts and experiences posted here so that information seekers can find and make informed decisions about joining or not joining Amway, but we must also suggest better options? Well, I will go one step further and offer some. While I am not advising anyone to listen to my thoughts, nor do I think you should act on what you read what's here without doing your due diligence your own soul searching, here are my opinions on what may be better than Amway:

1. Be a better steward of the money you already have. Many people have enough income but simply channel too much of it to things they don't need. A daily $5 cup of starbucks for example. Disciplined saving and investing. This may not sound exciting, but many people who are real millionaires did things in this manner. Success doesn't happen overnight so thinking it will in an Amway business is dangerous thinking.

2. Get a second job and set aside a portion for saving and investing. You will not only have more discretionary cash, but also more to be able to set aside for your golden years. One thing I did when I finished college was to work 2 jobs and my 2nd income was mostly invested for my golden years.

3. Start your own small business. The biggest issue with Amway, in my opinion is the endless supply of training that uplines sell. It causes most "serious" IBOs to end up with a net loss. You can find a niche product and sell it on ebay or craigslist, unlike Amway products. Another type of small business might be something like learning to do minor household repairs or installing hardwood flooring. These kinds of services are quite common and can be lucrative.

4. Do nothing. Since most business building Amway IBOs lose money, doing nothing, although comical, actually makes you better off than losing money because of functions and standing orders. You will also save your time, which can be used for more productive things.

5. Spend more time with your family. Ironically, many IBOs have this as a goal, but actually spend less time with family because of Amway related activities. It's ironic because many people join Amway with a desire for more time and money, but end with less time and money because of Amway.

There you have it folks. There are some ideaas of what might be better than spending your time and money participating in the Amway business and the Amway motivational organizations. While these are only ideas, only you can decide what is best for you and your family. In whatever you decide to do, I wish you well.

Amway And Debt?

One of the pitches used to attract people to the Amway business was to earn enough just to get out of debt. Afterall, many Americans these days have credit cards maxed out and racking up more and more consumer debt. But the tough question is whether joining Amway will help the situation or only make it worse? Afterall, in general, Amway products have higher prices than retailers such as WalMart or Costco. Anyone who denies this is either being deceptive or is truly misguided. You can try to argue about Amway's quality of products. Some products are good, but overall, consumers simply don't find enough value in them. Seems that IBOs don't even buy Amway products unless they are pursuing their dreams of going diamond. Once that dream ends, so does their loyalty to Amway products.

Sadly, for most business building IBOs, the business opportunity and its connected teaching system such as WWDB, BWW, or N21 simply creates more debt for IBOs. Think about it, an IBO will already be spending about $300 a month to earn their defacto 100 PV requirement. If that IBO subscribes to voicemail and no other tools, that IBO will already have a net loss for the month. Factor in ongoing expenditures such as standing orders, functions, open meetings, regional functions, books and other miscellaneous expenses and you have an IBO heading towards tens of thousands of dollars deeper into the debt hole. Most IBOs don't see what's happening because the debt is incurred a few hundred dollars a month, but most IBOs think it's okay because they are convinced that they will recoup the losses and earn a huge surplus in the long run. Unfortunately, only a tiny fraction of 1% of IBOs will ever earn a decent profit from the Amway opportunity. Most will realize they are making their finances worse and end up quitting.

In the few cases where a diamond's financial were exposed, these diamonds were in hock. Even a prominent triple diamond was not earning enough to sustain the lifestyle he and others promoted on stage. It is my guess that these diamonds in financial difficulty is more likely the norm than the exception. Do the math. If a triple diamond earns about a million dollars from Amway and the tools profits, can that income sustain a jetset lifestyle portrayed in functions like dream nite? I mean it is a great income, but everything is relative. Someone earning say $70,000 a year can live a comfortable lifestyle without debt. But diamonds portray a lifestyle of excess and almost arrogance. It's no wonder some of them have financial problems.

In the end, IBOs are drowning in debt as a whole. The system nearly ensures that the group of IBOs collectively will end up with a net loss with one or two at the top earning a profit. One's dedication to tools determines how much an IBO will lose. The more dedication, the bigger the losses. If your upline teaches you to get out of debt, that's good. but if they teach you to get out of debt, except for functions and standing orders, take that as a huge red flag.

Amway Numbers?

One of the things Amway IBOs are taught is to ignore facts, or to ignore numbers. I believe this is because the numbers are not pretty when you take a business like approach to the math behind the Amway business, for most IBOs. It is why upline teaching often "evolves" into things such as Amway saves marriages, or Amway makes you a nicer person, or that Amway is not about money, it is about friendships. That is a load of garbage. Business is about making a profit. If you hear some of these lines from your upline, it should be a red flag. Upline may also feed you other deceptive lines such as an IBO being successful because they showed up at a function, or because they just signed up for standing order. These are all just false lines to encourage an IBO who is not making money.

When you take a good look at the Amway presentation, the majority of IBOs are at the 100 PV level. At that level, they are spending about $300 monthly to reach 100 PV and for their efforts, they receive approximately a $10 check from Amway. Most IBOs will be encouraged to participate in some kind of system, often consisting of voicemail, websites, cds, books, seminars and other meetings. MOST IBOs will not recoup enough cash to cover any of these expenses, let alone all of them. At a glance, the system expenses may appear nominal such as $6 for a cd, $6 for an open meeting, $100 to $125 for a major function, $12 for a book. It is how upline gets you involved, and then after a while, an IBO starts to notice the negative cashflow and then a tough decision needs to be made. Either quit and cut the losses, or press on hoping that the system will eventually deliver on its promises.

What most IBOs don't notice, is that less than one half of one percent ever reach platinum. A fraction of one percent! And in many cases, platinums might break even or even suffer losses! So why would IBOs want to work so hard to reach platinum? They have less than a 1% chance of reaching that level. They have a tiny chance of maintaining that level, and they are still unlikely to earn any significant income at that level. A stody done by an attorney general in Wisconsin (Bruce Craig) revealed that platinum level IBOs averaged a net loss of about $900 annually. While Amway defenders will decry that the study is a bit dated, I will say this: The basics of the Amway business has not changed since that study was done, AND there are actually more system expenses today than there were back then, thus platinums may actually be losing more money annually than before. While not all platinums will lose money, I believe hard core dedicated platinums would stand to lose money.

As an IBO, I hope you are tracking your expenses versus your income. Most IBOs will see a negative cashflow month after month. Even though the Amway business is often promoted as low or no overhead, the system expenses (overhead) eventually begin to add up. Beware and please follow the numbers.

Amway Products Have Great Value?

It appears to me that Amway sales in the US have gone down. Globally, Amway sales declined to 9.5 billion after hitting a high of 11.8 billion a few years ago. However, if Amway didn't have expansion in China and India, I wonder what their sales would be like? I do not believe there has been signifcant growth even in the days of "Quixtar". I believe that mist Amway sales are simply to Amway IBOs who are taught "buy from yourself" or "be your own best customer". IBOs purchasing products is not a problem, unless they are purchasing more than they actually sell, especially in light of the recent FTC vs. Herbalife settlement.

Many IBOs and Amway defenders claim that Amway products are simply the "best". Some even go so far as to call Amway product superior to big box retailer's products. In the past, some unbiased reviews of Amway products compared to name brand had some Amway goods rated as average, some were very expensive, and some were satisfactory. Of course, quality is subjective and it certainly seems that whether or not one is an IBO determines that quality. But retail consumers have spoken. Price is an important consideration. WalMart proves this.

But here's the definitive question. If Amway products are so good, why do former IBOs rarely continue to buy them? I mean Amway sales would continue to climb steadily each year if former IBOs kept buying products. And here's another angle on all of this. If some former IBOs do purchase Amway goods, I would bet that they do not purchase 100 PV or more each month as they do when they are IBOs. It would appear that uplines are able to manipulate or create an artificial demand for Amway products amongst the active IBOs. This is a point of contention between Amway defenders and Amway critics because an artificial demand toes the line on legality issues.

There are tens of millions of former IBOs. There are less than 200 qualified diamonds in the US. I believe there are more lottery winners than qualified diamonds. But if there are tens of millions of former IBOs and hundreds of thousands of current IBOs why aren't the Amway sales consistently growing? I believe it's because Amway IBOs are the primary consumers of Amway products and former IBOs are not. And because information is easily available on the internet, prospects who are approached an easily google up Joecool's blog or other sites full of information and make an informed decision. I believe that is partly why sales are down in the US, because recruitment and sponsoring of new IBOs is down.

So if Amway products have such great value, why don't most former IBOs continue to purchase them?

Are Lies Needed To Build Your Amway Business?

The first time I was prospected for Amway, I was in college. I actually didn't know much about Amway but I had somehow formed a negative opinion of it. Needless to say, when I was invited to a beer bust and it turned instead to an Amway meeting, by impression of Amway got even worse. I eventually did join because a close friend of mine had achieved platinum and he had assured me that it could be done and that he would make sure that I would also achieve it. I did achieve a level just below platinum (4000 PV), but I quit for several reasons. First of all, I didn't make a net profit as the tools ate up my profits. Secondly, the more I progressed in the busines, the more and more my upline wanted control of my life. For example, we were told that we should check upline before getting married, buying a car, or even having children, etc. I thought that was very strange and I eventually left the business.

But in the US at least, I believe Amway's name to be so battered that an IBO cannot sponsor downline and build a business without lies and deception. There are hoards of stories confirming testimony that lies and deceit are common in prospecting potential IBOs. This was extremely rampant when Amway changed their name to Quixtar. IBOs would deny the connection or IBOs would say they are with network 21or WWDB and claim something ridiculous such as Amway simply being their supplier. The promotion of perfect water also brought on silly antics about a $50 case of water being capable of performing miracles. If the opportunity could stand on its own merits, then IBOs would not have to resort to such desperate measures.

Even the Amway presentation if often filled with deception and lies. I remember seeing the presentation and they said shopping through Amway, an IBO would save 30%over local retailers. When I actually saw the catalogs, I wondered where the savings was. The 6-4-2 plan or similar variations are made to sound easy and the presenter talked about lifelong residuakl willable income, which I also find to be deceptive if not an outright lie.

But can Amway be successfully promoted without lies and deception? It is my opinion that an IBO has no chance of building a business by being completely upfront and honest about Amway and about being an IBO. Even with lies and deceit, many IBOs still cannot get people to see the plan or to buy products. An Amway rep has stated that very little Amway products are sold to non IBOs. So if you cannot sell products and you cannot get people to see the plan, you cannot build a business and if you are purchasing tools, you are simply digging yourself a financial hole that will only grow larger as time passes. The cost of 100 PV is alreay more than what most families and/or singles spend in a month on household products. This means that most people simply cannot sustain themselves in the business and it explains why most IBOs drop out in the first year.

It is why lies and/or deception are needed for an IBO to have a chance at promoting and building an Amway business.

Why Amway Isn't Sustainable?

One of the selling points of the Amway business is for people to do the work once and then reap financial benefits for life. But that simply does not happen for the vast majority of IBOs. The reason why most IBOs do not have a sustainable business is because their business is not based on sales to genuine customers with a genuine need. Most IBOs themselves will not buy Amway products once their affiliation to Amway is over. They don't mind paying inflated prices while they have dreams of untold wealth, but their desire for those products fade as their dreams fade.

If you are an IBO doing your 100 PV monthly, then your only way to increase volume is to sponsor downline in hopes that they will also do their 100 PV as shown in the plan. And even if you are somehow able to accomplish this and sponsor a bunch of people as shown in the plan, chances are that many IBOs will "do nothing" and of the remaining, some will move 100 PV, but they will likely quit in one year or less.

In many or possibly most cases, IBOs are only selling the Amway opportunity and not Amway products. They sell the possibility or hope that they will build a business, walk away and collect untold wealth for the rest of their lives. It isn't going to happen. Say for example, you sold 100 PV monthly on a consistent basis to customers. These customers will automatically go online and make purchases when they run out of their products. If you are lucky, they will also refer friends to make purchases. But most IBOs do not sell products, they are selling the opportunity. Making residual income sounds like a good idea, but paying for overpriced vitamins and other goods "wears out its welcome" once an IBO realizes that their Amway business will not deliver lifelong residual income.

That brings up the next point about why an Amway business is not sustainable for most. The products cost more than most other retailers. That will limit the potential for customers and referals. Amway defenders like to cite quality issues, but most customers who shop online aren't familiar with Amway products and have no way to know whether Amway has quality products or not. That leaves them to decide based on prices. And Amway in general, costs much more than Walmart for the same or similar products. A tough sell indeed. And quality is subjective, so most people will decide on price alone. And on that basis, Amway cannot compete.

The Job Pyramid?

One of ths things I take issue with is how uplines will create an us versus them mentality in the business. Thus friends and family who care about you suddenly become "negative" and association with them should be limited. In some cases, people are discouraged from excellence in their jobs or professions because it takes the focus off of their Amway business. What I was told was to do my job, but my radar should always be on for new prospects. Some crossline IBOs turned down promotions at work because they did not want to have to work longer hours or take the focus off of their Amway businesses.

In some cases, the speaker at open meetings or functions will put down people's jobs. A commonly used acronym was J-O-B = "Just Over Broke". Some leaders also would say that my job was a pyramid because you will never earn more than the boss. A completely ridiculous comparison because someone's job has no relationship with how people view the Amway business (i.e. an Amway pyramid) and in a job, every employee gets paid and has a net gain at the end of the month. Not true in Amway. If IBOs only use KATE for example, an IBO at 100 PV or less will already be at a loss, and that is not considering any other expenses that IBO may have. And while a job may have a hierarchy, or chain of command, the business owner and CEO or manager earns their salary from customers, not directly from the pockets of their employees.

Some uplines will laugh about people's jobs, stating that they wake up at the "crack of noon". What these same uplines may not tell you is that they wake up at noon because they are up at 3:00 in the morning doing nite owls for their groups and looking for recruits. These same uplines possibly can't do much with their downlines since their downlines mostly tend to have 9-5 jobs.

So if you are of the opinion that nobody should criticize the Amway opportunity
or IBO behavior, maybe uplines and IBOs should not criticize family and friends who disagree with or are not interested in the opportunity, and maybe the same uplines and IBOs should not criticize people who choose to work jobs. Don't most IBOs rely on their jobs as their Amway income is not sufficient to even pay for their Amway business related expenses?

Amway Prosperity Preachers?

I remember pretty clearly, some of the things touted by upline to sell IBOs and recruits on the Amway business was to stress family values. That the man would do the work and that the wife would care for the children. I also heard prosperity preaching from various uplines as they spoke about how God wants you to be rich, or that Amway is a God pleasing business. Or that the business is more about friendships than about money.

I wonder how God would feel about uplines who lied to their groups about tools profits? I wonder how God would feel about uplines taking advantage of their downline in order to prosper? I wonder how God would feel about uplines advising downline to skip paying their rent or mortgages to pay for a function. Or how about having your family skip meals so you can buy more standing orders? I wonder how God would feel about IBOs worshipping the diamonds and money/material goods? As crazy as this sounds, these are actual things I heard as an IBO, and what’s crazier is that I believe some of these things are still taught today. There is ample evindence and testimony out there to indicate that many of these practices occur today.

The Good book (The Bible) says the love of money leads to all kinds of evils. (Timothy) I believe that the upline at one time truly wanted to develop training for their business. But what happened was GREED took over and corrupted the systems. It is why there are many lawsuits of diamonds versus diamonds. Diamonds moving their entire groups to form their own training systems, or diamonds even moving a another MLM altogether. It is quite evident that many uplines hearts are full of greed. It is why you hear blanket statements like never quit, or do what it takes to get to that next function, or that nobody can succeed without tools.

Power and adoration can be alluring. I believe many – a – diamond has become corrupt and greedy. Their needs come before those they pretend to serve. They are wolves with a nice suit and a nice smile. Their greed knows no bounds. They will tell you touching stories to tug on your heart. They will tell you anything that will increase their bottom line.

The most disturbing thing about these leaders is that they do these evil deeds under the pretense that they are serving God and/or promoting family values.

• Proverbs 22:16 - "He who oppresses the poor to increase his wealth and he who gives gifts to the rich — both come to poverty."

• 1 Timothy 6:7-10 - "For we brought nothing into this world, and it is certain we can carry nothing out. And having food and clothing, with these we shall be content. But those who desire to be rich fall into temptation and a snare, and into many foolish and harmful lusts which drown men in destruction and perdition. For the love of money is a root of all kinds of evil, for which some have strayed from the faith in their greediness, and pierced themselves through with many sorrows."

• Luke 18:22-25 - "... it is easier for a camel to go through the eye of a needle than for a rich man to enter the kingdom of God."

• 1 Timothy 6:3-5 - "If anyone teaches false doctrines and does not agree to the sound instruction of our Lord Jesus Christ and to godly teaching, he is conceited and understands nothing. He has an unhealthy interest in controversies and quarrels about words that result in envy, strife, malicious talk, evil suspicions and constant friction between men of corrupt mind, who have been robbed of the truth and who think that godliness is a means to financial gain."

The Amway Presentation?

I’m not sure whether this plan was carefully crafted out or whether it just evolved, but the way some uplines show the plan is cleverly designed to suck people into their systems. If you aren’t aware or careful, it’s easy to get caught up in the excitement of the presentation. The presentation is full of deception and I will try to point out these items in my analysis.

The speaker may talk about how he once thought he was “doing okay” in life. That he was making a living and able to meet his financial obligations. But he thought there might be more. One day he saw the plan and it changed his life. He did not realize he had gotten into a rut of going to work and going home every day and looking forward to his 2 weeks off each year. (This is relatable for many) That time and money are so important in life. Control of time and money is the key to success. Many people have lots of money but work all day and nite. Or people have time but are broke and can’t do much. The speaker might mention dreams or goals such as having an extra $500 a month or more. What would you do for an extra $500 a month. What about an extra $50,000 a year? Wouldn’t it be nice to have the wife stay home with the kids instead of leaving the family to go to work? Like the “Leave it to Beaver” days? (This gets the women excited)

The speaker will likely mention something about the economy and how prices always go up. The speaker may mention the 4 “I’s” that suck money out of your paycheck. The four I’s are Interest, Income Tax, Insurance and Inflation. The speaker may talk about how the government will take their cut and so on until you get your “net”. The speaker may mention how so many Americans are dead or broke by age 65, and that social security will collapse. (This instills fear in many people).

The speaker might also go on to mention how so many marriages are falling apart in the US because of financial stress. That couples work so hard that they have no family time and it hurts marriages. That people work so many hours these days that they are married to their desks. The “manager” of the office is the first one there and the last one to go home. That despite all of this work and effort, people are falling into debt. Credit cards maxed out, loans, trying to keep up with the Joneses. (Many people can relate to this)

But now, because he was looking for opportunity/open minded one day, he saw an opportunity. This opportunity changed his life and can do the same for you! The speaker now wakes up at the crack of noon. His wife stays home with him and the kids. They take nice vacations and they do what they want when they want. (Of course, who doesn’t? But is this true?) The opportunity takes advantage of the internet and allows you to leverage your time and money so that you can create a residual walk away income. (But nobody walks away do they?)

This is approximately the point in the presentation where they mention “Amway” At this point, the speaker will defend Amway, stating that if you can make money, does it matter.? If you can save money, does it matter? The speaker may go into the product line and mention partner stores and will likely show a 6-4-2 plan or a variation of it. In every case, they will show a best case scenario, not what is likely. Many prospects will leave thinking “all I need is six”. They don’t understand how unlikely it is to sponsor six platinums and there is no mention of the retention rates, the income most IBOs can expect, and firm questions will be deflected to the prospect’s inviter. The speaker may also discourage you from speaking to friends and family as they may have a bad experience but the diamond is successful and knows more about Amway than your family and friends.

Joe’s commentary: So the speaker becomes very relatable from the start. His situation in life will be like many in the audience. He will talk about doing okay,. But wanting more or looking for more. He talks about debts and many in the audience will also relate. They get people to think about dream cars or vacations. He talks about walk away income, but doesn’t mention that very very few ever make significant money and apparently, not many actually walk away either. They say you will make money and save money by doing the business. It’s hard to argue against that,.except most people will not make money or save money. In fact most people, if they participate fully or partially in the training system, they will lose money. For the dedicated IBOs, many of them LOSE LOTS OF MONEY. The plan is crafted out to sound sensible and relatable, but many IBOs will give it a try and shortly after, will realize that the system doesn’t work, that the reputation of Amway IBOs is soiled and sponsoring people or even getting people to see the plan is a barrier that most people simply cannot overcome. At least if you know what’s going on, you may be able to avoid the trap.

Get Rich Quick?

One thing many IBOs will talk about is how they were told that they would have to work hard and that they would not get rich quick in the Amway business. That Amway was not a get rich quick scheme. I do believe this, but what many Amway IBOs and Amway enthusiasts will not mention is that somewhere in the plan or when they were recruited, they were either directly told or implied that they would eventually "get rich" by joining Amway, whether it was "quick" or not.

If people were told that they would not get rich/wealthy and that they would have to work hard and that they would have to overcome the name reputation, how many people would join? As evidence to prove my point, many IBOs and former IBOs know about a major function occuring around this time of the year called "Winter Conference". Back in my IBO days, it was called "Dream Night". A handful of diamonds would host a dinner and they would show slideshows of extravagant wealth. Since in my days, IBOs were told there was NO PROFIT IN TOOLS, it was implied that all the luxurious trappings were a result of Amway income. (We now know that to be false)

The slide show was shown while the song "I wanna be rich" was playing in the background. There were pictures of jet skis, yachts, boats, jets, fancy cars, golf courses and designer suits and mansions. The audience was told that diamonds paid for everything in cash. The diamonds would stand on stage and tell the audience that they will work 24/7 but it was so worth it to go diamond. That you could catch up on sleep when you are a diamond. That the IBOs in the audience needed to hurry up and join them so they would have more playmates.

Looking back, it was a nice function. It got people to dream of having all of this material wealth. Sadly, I don't think a single one of the audience I was in ever got close to achieving that kind of success. In fact, the line of sponsorship I was in, WWDB, didn't have many new diamonds since I left Amway and in fact I think some diamonds have disappeared! Maybe they became negative losers like myself?

Yes, when you are prospected in Amway, the speaker may tell you that Amway is not
get rich quick.

What they don't tell you is that you won't become rich at all.

AmwayTools?

I recently saw commentary which I thought was very significant about the Amway "educational" system. This system is not run by Amway, but the for profit motivational systems such as BWW, WWDB, LTD, N21 etal. In many cases, these systems are touted as the key to an IBO's success. Unfortunately, there is no unbiased evidence that I know of to suggest that these materials do anything to help an IBO progress towards their business goals. Furthermore, these materials cost money. If upline didn't succeed until downline succeeds, woudn't they want everyone moving along, tools or not? As far as I know, uplines don't offer much help unless you are on tools. Do they rally want your success or do they simply want your money?

Also, what is interesting is that IBOs do not have a indivudual training plan. Uplines are often refered to as "mentors". I disagree. A mentor would work with someone one on one and make an assessment as to how to train someone. That isn't what happens for most IBOs. IBOs receive generic information from the diamonds and are expected to know what information to use and what not to use. Some refer to the information as a "buffet" where you pick and choose what you want and need. But how can an inexperienced prospect or IBO know what is useful or not? The label "mentor" sounds like total BS to me. There is little individual attention given to IBOs.

Instead the upline will generalize all of their downline and tell them that that books, tapes/cds and seminars is how they should learn. That eliminates many people from succeeding already. Many people do not learn in these types of learning environments. Many people have difficulty in picking up information from a tape or cd. Some upline may not be good at transfering information to downline in this manner as well. After all, what qualifies someone to teach? They signed up before you and achieved some level of success, even if you can't verify that they are currently qualified.

But still, upline convinces the masses that a one size fits all teaching system. They may also encourage some people to overspend on these materials, without any regard to an IBO's finances or progression in the business. Techinically, a sponsor is supposed to train any downline without cost, yet the downlines literally spend millions to get "trained" but very few people actually make a net profit.

I wonder what sincere efforts your uplines make to train and to mentor downline? Flying to a seminar where they might make $100,000 for a weekend doesn't seem like much personal attention when perhaps over 10,000 may be in attendance.

These training materials might be the key to success. But that success is much more likely to be enjoyed by the people who are profiting by selling these materials, and not those who are purchasing them. That much I'm certain of.

Amway Friends?

You hang out with friends. Generally, they are people you like and have similar interests. You have good and bad times, but your true friends are there for you when you need them. You move residences, your friends are there to help you move. They may play a round of golf with you, or watch some sporting events, dinners, backyard barbeques, etc. These are folks you will likely end up retiring with and enjoying your golden years.

But suddenly, you get enticed to join Amway. You see the "chance" to get rich, with a shortcut (not get rich quick, but a "shortcut"). You sign up and your sponsor is your new "best" friend. Most of the people you enjoyed being with think Amway is a questionable venture to get involved in. Suddenly, because of what you have been told or taught, you view these same nice people as "broke" or "losers", simply because they do not share the same ambition of untold wealth working 12-15 hours a weeek. Suddenly, you friends become prospects, or people you want to sponsor so you start recruiting them. Some may join, but most won't. Suddenly you are immersed in recruitment meetings, functions, and avoiding "negative", which is people and events that do not support your Amway business.

Now you are missing birthday parties, barbeques, and other social events. Your social events are now recruitment meetings, seminars and Amway business related events. You are taught that these events can be put off and your gratification delayed. You can do whatever you want when you go diamond. (Even though there me be only one (1) diamond out of every ten or twenty thousand IBOs) Your dedication will pay off right? Sadly, for most people, even very dedicated people, all they will see is losses on their yearly tax returns, mainly due to the purchase of cds, books, voicemail and function tickets. But these are your "friends" right?

Here's my take on it. Try missing a few meetings or functions. Stop buying cds and see how many "friends" remain from the business. It is likely that your upline will claim that you walked away from the friendship by slowing down on the "system". If that happens, then you have conditional friends, or fairweather friends. They are your "friends" while you are pursuing the same cause. They are your friends when you are attending functions. Are they there for you in bad times?

A short while after I attended my last function (I was still an IBO, just not a business builder), my dad passed away. Not a single one of my IBO "friends" bothered to attend the memorial service. Not a single one of my IBO friends called or dropped by the home to pay their respects. All of my "real" friends, who saw through the AMO smoke and mirrors called to talk to me and/or attended the memorial service.

Are your IBO friends conditional friends? Mine were.

Your Failing Amway Business?

After years of studying Amway and blogging, I've noticed something taught by IBO leaders that simply does not make any sense. It doesn't make sense business wise and it just doesn't add up. I know that sometimes, you need to think outside of the box and go against the grain to succeed, but some of the IBO practices are simply insane and it's no wonder that so many IBOs fail in their pursuit of their Amway "dream".

Most IBOs never sponsor a a single downline and relatively few products are sold to non IBOs. These are the reasons why most IBOs do not turn a profit but for some reason, many IBOs still seem to think that training materials are worth the money they pay for them. When you buy from yourself and sell very few products to real customers while losing money in the process, you are basically participating in a product pyramid scheme.

Buy from yourself. A fairly common practice. It is okay to support your business, but if you are the primary or only customer, you won't make money. Any profit you might turn is coming out of your own pockets. I don't know of any successful stores where the primary customers are the owner and the store employees. Yet some IBOs think this is how they will succeed. It's insanity.

Sponsor others. So you are struggling as an IBO. But the key to success is to try to open other stores by sponsoring. As a famous Amway apologist likes to claim, you do not get paid for sponsoring others. So why is this the emphasis for so many IBOs? Why would you think that opening more stores will make you successful? Yes, it is a way to possibly generate more volume, but your "success" will only come by having a bunch of struggling businesses under you. Is that how you wish to succeed? Also, the quest to sponsor others is probably how Amway got a bad reputation when IBOs tricked people into attending recruitment meetings and/or being deceptive when invitig someone to see the plan.

Folks, you need customers to succeed. I live in Hawaii and when tourism is slow, our local economy suffers. It's a very similar concept to your Amway business. Without customers circulating money through your business, you will eventually go out of business.

Big Amway "Dreams"?

One of the issues I have with the Amway plan is that the newest IBO, possibly the one who does the most "Work", receives the smallest compensation. Amway pays about 30 to 33% of their income back in the form of bonuses. An IBO who does 100 PV receives a 3% bonus and somewhere, uplines and sponsors receive the rest. Some of the upline may not have even met the IBO who actually did the work. Is that really fair and is that a level playing field? What do some of these uplines do to deserve the lion's share of the bonus you worked to get? Yes, the upline diamond may show the plan in an open meeting, which may help you, but then again, you pay for entrance into that meeting.

Many uplines will talk about dreams and fulfilling your dreams. But if an IBO would stop and think for a moment, you can easily see that you are building the dreams of your upline, and not your own. You receive a tiny portion of the bonus for the volume that you move, and then in addition, if you are on the system, then you are also paying upline in the form of tool purchases for the privilege of giving them bonuses with your product purchases.

It is why your upline diamonds can parade around on stage with designer suits and show you their fancy cars and mansions and other toys. It is because they are cashing in on your efforts. You are making their dreams come true. Your dedication to moving volume and purchasing standing orders are fulfilling dreams. The upline dreams. Yes, someday you can hope to have your own group of downline to exploit for your own benefit, but unless you are adding members to your group, you will never achieve the kinds of dreams that uplines talk about. In the meantime though, you are definitely helping someone upline achieve their dreams with every function you attend. Ironically, the upline leaders will tell you to never quit, even if they don't know your personal circumstances.

Here's a challenge for IBOs and/or prospects who are being recruited into the Amway business. 100 PV will cost around $300 a month and dedication to the tools system will cost you around $200 a month on average. Would you not be better off simply writing a check to your upline for $100 and not even joining? Would you not be better off staying home and watching television instead of joining? If you read all of the information available on this blog and still decide to join, goo d luck to you, but remember this: Whose dreams are being fulfilled by your participation?

Buy From Yourself?

One of the apparently common practices among major IBO groups is still the concept of "buy from yourself". I believe IBO leaders teach this because most people are not familiar or not comfortable selling goods and services. Therefore, to teach buy from yourself makes the business an easier sell. In reality, an Amway IBO is simply a comissioned salesperson with no benefits. But presenting the opportunity that way is unlikely to yield results either, thus the buy from yourself has become a common practice. It makes the prospect feel at ease and they might think they can do this business.

Buying from youself makes you a customer and not a business owner. Buying from yourself doesn't generate your business a profit. Would you open a car dealership to buy a car? Now I am not suggesting that supporting your own business is a bad idea. What I am suggesting is if you are the primary or exclusive customer of your Amway business, then you aren't really running a business. You are simply a glorified customer. No business can prosper by having the owner make the majority of the purchases.

What an IBO is really doing is paying his upline's bonuses. Amway overcharges more than 30% of the cost of their product. They have to do this in order to be able to pay IBO bonuses. Since most IBOs are at 100 PV or less, the lion's share of the bonuses earned are channeled upline when a purchase is made. It is not a level playing field as some IBO leaders might suggest. The upline has a huge advantage even though they might ay it's a fair system.

What compounds the situation and makes it worse is when an IBO pays for standing order or attends functions where some of these IBO leaders may teach this bad business practice. You as an IBO already pverpay for products for which upline gets most of the bonus, but then the problem is compounded by IBOs paying to receive this bad advice. When I was an IBO, I heard speakers talk about skipping rent or mortgage payments to attend more functions, or having your family skip a meal so you can buy standing orders. Buying from yourself is just another example of bad advice given fro upline to downline. What makes it worse is that some uplines profit by giving bad advice.

Are you buying from yourself almost exclusively? Can you think of any truly successful business where the owner is the main or possibly the only customer? I can't think of any.

Amway IBOs Help People?

When I was an IBO, I remember at many meetings, the speaker would talk about how Amway IBOs are helping people by getting them in the business or at least by showing them the plan. Looking back, I fail to see how inviting someone into a business where they are virtually assured of losing money (in the systems) is helping them. This is also how some IBOs think that they are suddenly "better" people because they think they are helping people by being an IBO.

On average, Amway products cost more than retailers so a prospect is not helped by purchasing Amway products because they are paying a premium price. For IBOs purchasing Amway products, they are taking away from their local economy by purchasing Amway goods, although I guess you could argue that the IBO is helping Amway to succeed.

IBOs who are actively building a business usually have many meetings to attend, and hard core IBOs are taught not to miss any meetings. Therefore an IBO has less time to spend with his or her family and friends. The IBO has less time to spend at church, and less time to help with any community projects. The IBO will probably miss someone's wedding or birthday celebration because of the hectic schedule of an IBO. It's a part of being dedicated to the Amway business and the system of teaching.

While all of this activity is happening, IBOs also have less money because the voicemail, standing order, functions and books and other expenses eat away at an IBO's resources. Thus IBOs have less to contribute to charity or even for their entertainment and enjoyment.

So an honest question. How do IBOs help people by building an Amway business? How are they better people by showing someone the plan or sponsoring them into a business that nearly assures they will lose money?

Im my informed opinion, the nicer and better person is what upline teaches as a side note to distract an IBO from the FACT that they are losing money because of the defacto 100 PV and tools requirements. They also make it seem as if IBOs are "helping" people by showing them the business plan. When you think about it, perhaps just the opposite is happening. This is another tactic, IMO, that uplines use to justify an IBO's lack of progress, much like how they tell downline that they are successful just by getting themselves to a function. If you are an IBO or a prospect, please read this article carefully.

Amway Prospects?

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 about 29 years old 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. Young people will often be open minded about it because they are often just starting their careers and have many years to work before retirement can be thought of.

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. After all, the pitch "2-5 years, part time" sounds pretty good for financial freedom.

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 thing. I know I certainly had some of these same dreams when I was an IBO. But isn't it shady to sell prospects on those dreams, know they are very unlikely to get anywhere close to those dreams?

But the sad reality is that some 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 corwns 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, or even pass away while still working the Amway business. It is apparent that long term residual income is a myth.

Amway currently reports that the average IBO earns $202 a month. That number is deceiving because Amway mentions in fine print that the "average" income is based on "active" IBOs. Only 47% of IBOs are considered as active, thus the real average income is about $100 a month. That $100 a month includes the diamonds and big shots who drive up the average. But that income also is gross and doesn't factor in time and business expenses used up building the Amway business. For this reason, you can easily see how IBOs can end up losing money. If Amway prospects knew about this, how many would actually think twice before joining?

The Amway "Sweat Shop"?

Some big companies and some private entrepreneurs have been accused of being "sweat shop owners". This is when they exploit workers, often in foreign countries by having them work for a very small wage. For example, a foreign operation may have a warehouse full of women and children working all day under poor conditions for a few bucks a day. The owners of these operations can rake in the dough as they save a ton of money in labor costs.

Some uplines operate just like sweat shop owners, but in many cases, they are worse then sweat shop owners because even exploited workers earn something. At the end of the month, they have a net gain, even if it might be small. In the case of many Amway IBOs, they spend money on Amway products, and uplines take the lion's share of the rebate/bonus that is generated by those sales, and then in turn, these same uplines try to get many of their downline to also become customers of their system of cds, books, voicemail and seminars or functions. In many, probably most cases, uplines will make just as much if not more income from the system, than from Amway.

These same upline will also teach firece loyalty to the system. Never miss a function. Make sacrifices to buy more books or cds, and make sure you are always looking for people to sponsor to add to the system. Joining the system almost guarantees that you will suffer a net loss in the Amway business. It is why I continue to write about what IBOs and prospects should look for when they are being recruited or indoctrinated into these systems. It is why there are so many defenders of Amway, most of whom are losing money, but think they are still successful because it is what upline teaches.

I know most IBOs won't believe this, but I will say it anyway. IBOs on the system are probably worse off than sweat shop employees because they are paying their upline to do their work. At least sweat shop employees get a salary. Upline will teach you that it is an honor to drive them around, or to do tasks for them. Many platinums works are free doormen and ushers at meetings and functions. Upline benefits by maximizing profits from functions. It is pure downline exploitation and I hope eventually that more and more IBOs will recognize this.

Get A Job!

One of the things that IBO leaders do quite often in their recruitment pitch for Amway, is to put down people's jobs. They criticize people's bosses and the fact that an employee needs to report somewhere to earn a living. They try to paint the picture of a job being compared to slavery. They do this apparently to make people feel uncomfortable with their present situation so they will be open to looking at the Amway opportunity as a means to make a living.

So I will ask - What's wrong with a job? A job is not slavery. People apply for their jobs and they agree to a wage or salary in exchange for their services. Certainly, you can leverage a higher wage or salary if you have an education or a skill, such as being able to work in the construction field. A job ususally offers more than just a wage. A job often allows one to have benefits such as medical insurance, a 401K retirement plan, and some other benefits such as vacation and/or sick leave.

A recent site visitor bemoans concept of working for minimum wage, where a husband and wife would earn in the neighborhood of 30K if they both work full time at minimum wage. Of course, a high school student can earn minimum wage so two adult only able to generate that kind of income makes me think my site visitor is speaking of people with very little to offer an employer. Most people may start out as entry level, but earn more and more as they gain experience and can offer more to their employer.

What does the average Amway business owner experience? $115 a month income (which is probably way above average)? Most IBOs as outlined in "the plan" earn about $9 a month and may have expenses such as standing order which will take away from that tiny profit. Thus an average business building IBO stands to net a loss. It is very easy to look at the math and make that conclusion.

So I ask again. What's wrong with a job? You have a net gain each and every month, be able to pay for your living expenses, and allow you to contribute to society by paying taxes. The average CORE IBO is a drain on the US tax paying society by spening money on standing order and functions and then deducting these expenses when filing their taxes. The only beneficiary is the upline leaders who sell standing orders and function tickets. So what's wrong with a J-O-B?

Why Amway IBOs Fail?

Most IBOs fail. That is not a wild guess. That is a fact. Amway supporters will argue that many IBOs do little or nothing, and while that might be true, even the remaining IBOs who work hard, still find little or no success. The system is set up that way. If you see a diamond "walking the beaches" as the cash rolls in, that means someone is putting forth the effort to make that happen. It is the downline IBOs who purchase Amway products and tools that allow these diamonds to enjoy what they portray as success.

We also know that some diamonds overhype their success. There has been evidence that the diamond lifestyle is often not what people think it is. If you could truly earn residual income by the bucketload, why do diamonds quit, resign, lose homes in foreclosure proceedings, and even wind up in bankruptcy court? One could argue that some diamonds are failures. The diamond lifestyle is an illusion created by upline leaders as a means to entice recruits.

Many Amway zealots and apologists try to make ridiculous claims comparing a company owner to a diamond. The big difference is that a company owner has employees who get a regular paycheck. These employees generally wanted the job and probably applied for the work. And if and when an employee leaves, there are other applicants who are willing to step in and do the work. Thus the business continues to meet their demands and continues to profit.

In the Amway opportunity, the IBOs spend money purchasing products, and then upline leaders expect these same folks to spend even more money to learn how to be motivated to do the Amway business. But in reality, if IBOs made profits, that would likely be sufficient motivation to run their businesses. Because it is hard to find enough (suckers) IBOs to join the business and fork out cash while they lose money, other IBOs have resorted to trickery, deception and outright lying at times, in order to attract potential downlines.

The 6-4-2 system ensures that the majority of business builders must "do the work" to uphold their platinum, who (probably) barely earns a net profit. And then you need 3 or 6 groups of IBOs losing money in order to maintain an emerald or diamond.
Amway has revealed that less than 4% of product moves to non IBOs. The absence of non IBO customers nearly guarantees that most IBO groups will lose money or make very little. Most IBOs are destined to fail. And it is not necessarily the IBO's fault. The system itself comes with many flaws which most IBOs cannot overcome, even for those who put forth much effort. It is why most IBOs fail. It is why I hope prospects will find and read this information before making a final decision to sign up or not.

Personal Resposnibility?

One of the things that I heard, and I still hear today is how an IBO can become successfuly simply by duplicating, copying, or following the advice of their upline. The concept is simple, do as you are told and you will succeed. You don't have to be brilliant, you just need the ability to copy and follow advice. I'm sure many Amway IBOs have heard this from someone in their upline. On the surface it seems logical, just do the same things that your upline did and the results will be the same.

Unfortunately, it doesn't work that way. You cannot simply re-create your upline's circumstances and copy it. Your upline likely had a different circle of influence in their lives. They knew and associated with different people and had a different set of skills and/or qualities. Some people are more charismatic and are better at interacting with others. Some people are more convincing and some are not. Some uplines may have worked with a lot of people, thus having many contacts, whereas someone who works alone at nite may not have any contacts. It is not a simple matter of copying. Even if you can get someone "in front of your upline" to see the plan, you still need to talk to people to make this happen.

Upline leaders will often convince their downline that their tools are the key to success. My sponsor used to always tell our group that "tapes sponsor people". Although a tape may have helped sponsor someone, somewhere, I never saw a single person who got sponsored because of a tape or cd. I also have not heard of anyone who got sponsored by listening to a tape.

The issue at hand though, is for hard working IBOs who work the system, do the core steps only to fail. This is where upline then places blame on the IBO rather than the system. The IBO is taught to accept personal responsibility even though the system may have failed him/her. The system will take credit for successes, but will never take responsibility for an IBO's failure. This is a problem. It's like playing a game you cannot win. The system is touted when 1 in 20,000 or so reaches the diamond level, but noone mentions the system when talking about the 19,999 who did not reach the ultimate level.

Why doesn't the system and the upline leaders take personal responsibility for a change?

Wealthy Amway Uplines?

I remember the first time I saw the "plan" at a big hotel meeting. The person who invited me told me to be sure that I was there on time because in business, time is money. I was a bit disturbed when the speaker showed up 20 minutes late. Anyway, the speaker arrived to a standing ovation. The speaker host really built up the diamond speaker, saying the audience was really lucky as the speaker was sought all over the country and that the speaker was in the top one tenth of one percent of all income earners in the US (never confirmed though). This was common practice it seems, and some speakers got into how much money they had. At one open meeting, I remember Bill Britt proclaiming that he was close to being a "billionaire". The crowd went wild of course, even though it wasn't close to being true AFAIK.

At major functions, the IBOs would line up to watch the diamonds arrive at the hotel in their Mercedes, BMWs, Lexus and other fancy cars. We were told stories of fabulous wealth, early retirement, making large purchases in cash, etc. One major function, now called winter conference, used to be called "dream nite". We saw videos of jetskis, golf memberships, jets, cars, mansions and other toys to the background music of "I wanna be rich" sung by a group called "Calloway".

What went unnoticed by myself, and probably most IBOs was where upline's wealth actually came from. I mean we saw the big checks from Amway and all. At the time, the tools income was not disclosed, but most groups at least mention tools money now, even though details remain a bit sketchy as to who qualifies and how much you can earn. We know from Amway's own information that very few products are sold to people who are not IBOs, therefore one can reasonably conclude that the "wealthy" upline makes much of their income primarily from downline purchases. And the cds, books, KATE, functions and other support materials are bought only by IBOs, thus that source of income is almost soley from IBOs.

Basically, the fabulous wealth that some upline diamond portray simply comes out of the thousands of their downline's pockets. It's no secret that significant profit comes from selling tools. The problem though, is that some uplines gain all this wealth and the tools don't work for the vast majority, regardless of the amount of effort.

Now I already know that some supporters and apologists of the business and the systems will say that all businesses make money from people. While that is true, it is not done under the pretense of you buying and using tools that will make you wealthy or buying products for yourself that will make you wealthy. And you can't compare this to a job because everyone is an independent business owner. And besides in a job, everyone gets a paycheck and the income is derived from customer sales. In Amway, the "sales" are primarily from the IBOs themselves.

So prospects and IBOs, when you see your upline's fabulous wealth being flashed about, you no longer have to wonder where the wealth came from. All you need to do is look at your dwindling bank account and you will get your answers.

Amway Business Support Materials?

One of the biggest points of contention between Amway critics and Amway supporters is the debate about tools, or business support materials (BSM). These materials commonly consist of voicemail, website fees, cds, standing order, books and seminars or functions. I agree that some training might be helpful to a new IBO, but how much training? A sponsor is obligated to train those whom they sponsor, so how much training do you actually need? Also, I used to wonder why you couldn't buy a certain book at Barnes and Noble if it was cheaper than buying it from Upline?

The Amway business, broken down to very simple terms, is buying and selling products, and recruiting others, if you desire to build volume and perhaps to achieve a "level" in the business. The tools, or BSM are often touted as the key to your success as an IBO, but it is often a conflict of interest for upline to promote this as some of them profit from the sales of BSM. Also, according to the Amway accreditation rules, a written and transparent compensation plan for their professional develop program (tools/BSM) is required, but I have yet to actually see IBOs who know about this. Seems this aspect of accreditation is either not policed, and/or it seems IBOs are certainly not aware of this. After all, if IBOs and prospects are told that there is income for IBOs via tools at a certain level, how do you know if you qualify, and for how much?

But aside from that conversation, what purpose do the tools actually serve? I have heard IBOs talk about how they benefit from tools, but when asked if the tools resulted in a net profit from Amway, the silence was deafening. When I was an IBO, and apparently even now, the tools rarely contain specific material about how to actually run a profitable Amway business. There were no standing orders that told me how to track profits and expenditures. There were no speeches about record keeping and how to file business taxes. There were no meetings where we discussed return on investment of both time and money.

There was talk about dreams, and ignoring facts if the dream was big enough. There was talk about it being okay to go into unscured credit card debt, as long as it was to buy tools or more function tickets. There was talk about sacrificing family needs if it meant buying more tools. Sure, upline didn't force you to do this, they simply convinced you that it was a good idea, much like how a conman makes you think you are making a good decision when they are playing you.

This blog doesn't serve to convince you one way or another about the many subjects, but to offer a differing opinion for IBOs and new prospects to base their decisions on. If you see things here that make sense, I urge you to read more, and to ask your upline or sponsor the tough questions about the tools, or your continued involvement, especially if you are at a net loss at the end of the month.

Amway Business Support Materials?

One of the biggest points of contention between Amway critics and Amway supporters is the debate about tools, or business support materials (BSM). These materials commonly consist of voicemail, website fees, cds, standing order, books and seminars or functions. I agree that some training might be helpful to a new IBO, but how much training? A sponsor is obligated to train those whom they sponsor, so how much training do you actually need? Also, I used to wonder why you couldn't buy a certain book at Barnes and Noble if it was cheaper than buying it from Upline?

The Amway business, broken down to very simple terms, is buying and selling products, and recruiting others, if you desire to build volume and perhaps to achieve a "level" in the business. The tools, or BSM are often touted as the key to your success as an IBO, but it is often a conflict of interest for upline to promote this as some of them profit from the sales of BSM. Also, according to the Amway accreditation rules, a written and transparent compensation plan for their professional develop program (tools/BSM) is required, but I have yet to actually see IBOs who know about this. Seems this aspect of accreditation is either not policed, and/or it seems IBOs are certainly not aware of this. After all, if IBOs and prospects are told that there is income for IBOs via tools at a certain level, how do you know if you qualify, and for how much?

But aside from that conversation, what purpose do the tools actually serve? I have heard IBOs talk about how they benefit from tools, but when asked if the tools resulted in a net profit from Amway, the silence was deafening. When I was an IBO, and apparently even now, the tools rarely contain specific material about how to actually run a profitable Amway business. There were no standing orders that told me how to track profits and expenditures. There were no speeches about record keeping and how to file business taxes. There were no meetings where we discussed return on investment of both time and money.

There was talk about dreams, and ignoring facts if the dream was big enough. There was talk about it being okay to go into unscured credit card debt, as long as it was to buy tools or more function tickets. There was talk about sacrificing family needs if it meant buying more tools. Sure, upline didn't force you to do this, they simply convinced you that it was a good idea, much like how a conman makes you think you are making a good decision when they are playing you.

This blog doesn't serve to convince you one way or another about the many subjects, but to offer a differing opinion for IBOs and new prospects to base their decisions on. If you see things here that make sense, I urge you to read more, and to ask your upline or sponsor the tough questions about the tools, or your continued involvement, especially if you are at a net loss at the end of the month.

What Is The WWDB Eagle Program?

A frequent site visitor has asked numerous times and has doubted that there is such a thing as "Eagle" parameters. Now I don't know if WWDB still has this program, but I believe they do as I have seen some newbie IBOs mention that they are striving for Eagle. While Eagle may look like a "winner's club" of sorts to IBOs, I believe that the Eagles are basically the big money makers for the lines of sponsorship, which is probably why this program was created. Here are the general details:

Signed Counsel Sheet to Upline Diamond
300 PV personal use/retail for couples, 200 PV personal use/retail for singles
6-5-3 (PB/SO/MF) - Explained below
6 legs at 100 PV or higher
5 legs on standing order
3 legs attending major functions

Amquix info has more information: http://www.amquix.info/pdfs/wwdb_eagle.pdf

This is the Eagle program. Since most IBOs are not able to sponsor a single downline, you can see that Eagle is probably a fairly exclusive club. But if you look at the cost of 300 or 200 PV ($900 or $600), most families would be hard pressed to move that much personal volume. Of course you can sell product, but my upline did not emphasize selling, but more personal use.

In addition to the PV, you have 5 legs on standing order and 3 legs traveling to major functions (I'm from Hawaii). The Eagle program made a lot of money for upline, but not necessarily for the IBO who held the Eagle parameters. It is possible to be an Eagle and not be at 2500 PV. However, a structure like this without the tools might be profitable. But I have never heard anyone be glorified for selling products in Amway.

But overall, the eagle program is one that ensures maximum profitability for the upline diamond, and not for the IBO. That alone, speaks volumes.

Amway Works If You Work It?

The business works if you work it! That's what many Amway enthusiasts will claim. I do not believe that is true and I will further explain in this post. Many IBOs who claim that the business works are usually new and are unable to show any evidence that the business works, except perhaps to show a photocopied check from an upline diamond or the like. Or they may have a story of how they know a guy who retired at the age of 29, etc etc.

Let me make a disclaimer that some people do make significant money from Amway, but most of those folks are tenured diamonds who are almost in an exclusive club. There is only a short list of new diamonds that I know of in the US, and I have heard that even these new diamonds may have had legs in other countries. It would seem that Amway is not growing in the US and Canada, as evidenced by the large decline in sales the last couple of years. Also of note, Amway did not release figures that are seperate between Amway North America and the rest of their overseas operations but overall, Amway saw a large decrease in sales in the last two years, dropping from 11.8 down to 9.5 billion.

Ok, so Amway enthusiasts claim that the business works if you work it. Business in its simplest form is selling a product or service for a profit. Yet many many IBOs spend so much of their time doing other things, as advised by their upline "mentors" who sell them training materials that take up much of their valuable time. Listening to tapes/cds, attending functions, reading books, and other training activities not only costs the IBO money, but takes up valuable time in non -income producing activities. Nobody makes sales reading books or attending seminars. Inviting people to see "the plan" may be a way to help generate volume but with Amway's reputation, even this is a hit and (mostly) miss activity.

Yet IBOs spend almost all of their time doing these activities (the work) when they could be better off not getting the training and focusing on selling the Amway products and services. Even that comes with a handicap as Amway products as a whole, costs a lot more than purchasing similar or the same products as a big retailer such as Costco or WalMart. It is why most IBOs eventually get discouraged and quit far before the promoted 2-5 year plan.

Few people will even bother to see the plan once you mention "Amway" and for those who are open minded and motivated to register end up having to deal with a hard to sell opportunity along with high priced common commodities such as soap, vitamins and energy drinks. It's pretty easy to see that the business does not work, even for most of those who actually work it. There are simply too many issues with the business that handicaps those brave enough to try. It seems even the fiercest defenders of Amway are unable to provide a shred of evidence that they have actually made a profit from this opportunity.
That speaks volumes.

How To Lose Tons Of Money In Amway?

When I was recruited into Amway, I was told that I could make money, which would roll in forever and ever. Residual income. That was the concept that appealed to me when I was recruited. I was also intrigued when I was told that I could do as much or as little as I wanted. The plan seemed achievable at first, until the realities of the business began to sink in.

However, when I signed up, my sponsor told me that I would be wasting my time signing up to sell products (not verbatim). That if I was going to get involved, I may as well try to build an organization and make the big bucks. I consented and then he immediately told me that I needed to get on standing order. I was told that standing order was a tape subscription and it was only $6 a tape. Nobody ever mentioned that every other week, it was a two tape set, so you are committing to 6 tapes/cds a month and upline also expected that you purchase more because you can't listen to the same ones each day and learn.

After a week or two, I had registered a couple of my friends into the business and my sponsor tells me that I cannot be a leader without attending all of the functions, and that I cannot listen to the same tapes over and over. That's when my expenses shot up like crazy. Of course I was excited with the folks I had sponsored so I went along with the plan, and I was edified for it so it seemed like I was "being an emerging leader".

Amway defenders question how I could possibly spend an average of nearly $1000 in a month for tools. Here's the breakdown, and although my WWDB group experience may not apply to all, I certainly continue to hear similar stories of abuse. I've also seen and heard of others with similar experiences.

Standing order $36 a month. (6 tapes/cds a month @ $6 each)
5-7 extra tapes/cds each week $120 - $168 a month
Amvox $24 a month
Open Meeting $6 a month
Regional functions $24 a month
Subtotal: $258/month

Major functions (4 times a year) I live in Hawaii, and major functions required mainland travel at peak travel times (January, March, July, October).
Round trip airfare $700
Hotel: $240 (for 2-3 days)
Rental car: $150 - 50 per day for 2-3 days)
Function tickets $100 - $150
Meals and other misc expenses pushed a major function to over $1200 for each trip.

These costs, not including gas money and other incidental expenses, totals about $8000 a year. Add in the cost of products and you are spending about $1000 a month on Amway. Yes, the products are not really a business expense, but then again, how many of those over-priced products would you buy if you were not an IBO? Do any former IBOs still buy double x? Do IBOs actually sell any double x? I believe these customers are rare.

If your sponsor told you that Amway would cost you nearly $1000 a month (high end, including product) or $150 a month (low end, not including products), would you still join? Once you agree to register, the expenses are then slowly revealed to you and in many cases, called investments into your business. Be wary and ask tough questions as to whether these items help you to make a profit, or whether they take away your profit.

Defending Amway?

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 (David Steadson), 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 $10 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.

Why Amway IBOs Fail?

One of the things touted by many upline leaders as the "key to success" is CORE. I have outlined the elements of CORE here. The reason why so many Amway IBOs fail is because these alleged foolproof steps taught by upline, contain practically nothing but non income producing activities.

1 - Show the Plan
2 - Retail the Products
3 - Tapes/cds
4 - Books
5 - Functions
6 - Accountability
7 - Counsel with Upline (Be teachable!)
8 - Buy 100% of your own products
9 – Communikate

In these nine steps, only #2 (selling products) may actually net the IBO a profit, but this step is not emphasized in the teaching of many groups. In all the other core steps, you either spend time and money doing things that do not produce income for your business. If you, as an IBO, spend most of your time in non income producing activities, guess what? You will suffer losses. It is no wonder nearly all IBOs lose money, they are taught to spend most of their time in activities that do not produce income! And to make t worse, these steps take money out of an IBO's pocket. It's no wonder Amway IBOs are doomed to failure once they register as IBOs.

Imagine owning a brick and mortar store where you open the store for one hour a day. The rest of the day you are reading books, listening to tapes/cds, and paying to attend seminars and listening to voicemail messages. Oh, and in addition to opening your store for an hour a day, you don't advertise except for word of mouth. Could you survive in business? I think you can't possibly survive. But this is basically what IBOs are doing. What makes it worse is they are doing this as advised by their upline.

So can an IBO make money by spending most of his/her time in non income producing activity? The answer is clear to me.

Amway Fruit On The Tree?

I had a good chuckle recently when some Amway apologists spoke about looking at the "fruit on the tree". One commentator said his parents were broke and he looked to his diamond since the diamond apparently had fruit on the tree. I thought about this concept and I agree, that perhaps we should look at fruit on the tree. The real question is whether or not the diamonds will let you see the fruit they claim to have.

IBOs and Amway prospects, please ask your upline platinum or diamond to show you the fruit on their tree. Ask them to see their (business) financial statements. This is actually a common practice in real business. When a friend of mine sold his business a few years back, he made three year's worth of income tax returns to show prospective buyers. My friend showed his business and personal taxes, because the prospective buyer wanted full disclosure, and he provided it.

As far as I know, not one single bigger pin has ever shown their business financials. In fact, if it made certain bigger pins look good, why wouldn't they want to "show their fruit". They certainly don't mind showing off diamond rings, fancy clothes, sports cars and the like. What many IBOs don't understand is that fancy cars and other toys is not evidence of fruit on the tree. We don't know who owns the things they show you on a slide show. I could go take pictures of mansions and sports cars and show them from a stage, but it doesn't mean I own them.

It has been discussed that some diamonds may rent cars or fancy homes and try to imply that they own these items. Some diamonds, possibly many diamonds in the past have lied or embellished the truth about paying for everything in cash, including their homes and cars. They also at times, have given the audience the impression that these luxuries are all purchased with Amway income, and we know that many diamonds have probably had supplemental income from the tool systems, or other business ventures outside of Amway.

We also know that some diamonds are in debt, but simply try to portray an excessive lifestyle. (See Ruth Carter's Book: Amway Motivational Organizations, Behind the Smoke and Mirrors). Some diamonds may have a substantial income, but it doesn't mean they are financially free and able to live a jetset lifestyle that many portray. It is an illusion, possibly to be able to attract new prospects into the business. The stark reality is diamonds living in debt, or diamonds living beyond their means (keeping up with the Joneses)

So yes, let us actually see the fruit on the tree. Is there any fruit?

Fake Financial Gurus?

Based on my experience in Amway, my blogging experience, and observation of other people who give financial advice such as real estate gurus who teach you to buy property with no money down, or others such as Robert Kiyosaki for that matter, all show testimonials of sucessful people. Obviously they do not show you the vast majority of people who try their systems and fail. Many have the disclaimer that success is a "unique" experience. There's a good reason for that.

It is my informed opinion that whether it is Amway, WWDB, BWW, N21, real estate or the cashflow business, the vast majority of people who try these systems do not make any kind of significant income or any net income at all for that matter. Sure, some do, and those are shown as the possibilities. But if you watch infomercials, you will see many testimonials from smiling people who claim they made money using the alleged system. What you won't see if whether the income made is sustainable and the tens of thousands of people who may have tried the system but were unable to generate any income.

Some Amway diamonds have been heard saying that doers do, and those who can't do, teach. So what do you think Amway diamonds and alleged financial gurus like Kiyosaki are doing? They are teaching and not "doing", are they not? If Kiyosaki could make millions by doing his own methods, he wouldn't need to pimp his books and seminars. I'm pretty sure he's not writing books and pimping seminars out of the pure goodness in his heart to help people. Same goes for the Amway diamonds. But if you only take away one point from this message, it's that the diamonds themselves are teachers and not doers.

These systems in general do not work for various reasons. Many people simply do not have the acumen to work the system. Or the system has too many variables for the system to work, or the system calls for things beyond your control. For example, success in Amway generally requires you to sponsor others, something that is beyond the control of most people. Add in the lazy and people who are hoping for a quick score and it is understandable that most will fail. But these systems are often set up where the majority simply cannot all succeed. Nowhere is that more true than the Amway business where the pyramidal compensation plan nearly guarantees failure for the lower level IBOs. In the common 6-4-2 plan, there is 1 platinum and 78 downline who aren't. And that flawed plan assumes that all IBOs actually did enough to earn a bonus.

So what can someone do? Well, it may not be as sexy or attractive but a part time job and investing and saving might be something to think about. Even a part time business where you focus on selling products for a profit might work. It just seems prudent to avoid these "systems" as the primary beneficiary of these "systems" are the ones who sell them.