Wednesday, January 13, 2016

What Actual Value Does Your Amway Business Have?

Many many people see the Amway plan, sign up as an IBO in the hopes that Amway income will help them fulfill their dreams and that they will walk away from their jobs at a young age and collect lifelong residual income while walking the beaches of the world. Sadly, most IBOs will never even sponsor a single downline or see a net profit. These IBOs may continue in the business for a while but will eventually quit when they see the writing on the wall. Someone mentioned on another forum that people who want to work 2-5 years and do nothing thereafter are probably lazy and therefore, are not capable of achieving in anything, much less in Amway. I agree with this but even hard working eager IBOs generally make nothing or lose money.

But wait, you're an "independent business owner". So instead of quitting, why not sell your Amway business? I wonder if any IBOs actually think about what their business is worth. I mean a diamond in theory could sell their business and live large happily ever after right? Here's some food for thought. Why are there instance of diamonds quitting or resigning from Amway? Why would they just quit when they could either walk away and collect an income "forever" or sell the business? I mean do IBOs ever stop and think about this? It is an honest and serious question that should get some consideration. Honestly, why would a diamond not walk away if they could collect income forever?

I believe diamonds quit and resign because their business is worth very little or nothing. And most Amway businesses do not even generate a net profit. For IBOs who are seriously pondering on this very important message, try looking up this topic in Amway's rules. There are very complicated steps to be taken when selling your Amway business as each person upline must be offered ownership (To the best of my understanding). This process can go on for a long time and the attrition of your business could render it worthless before you can find a buyer, if you have a buyer at all. Also, if you quit, the downline in your group would be surrendered to the immediate upline anyway. So why would your upline want to buy your business?

So IBOs, I ask you. What is your business worth? You don't own your downline. They are independent owners like yourself. You should not have inventory, employees or some warehouse storage complex. Aside from the ability to add downline volume to your own, your Amway business likely has very little value in the real world. So IBOs and prospects, think about it for a minute. What is the value of your Amway business? Ever see anyone sell their Amway business or actually walk away from Amway to collect residual income? Do you ever wonder why crowns and double diamonds are still working, even beyond retirement age for people with jobs?

37 comments:

Anonymous said...

It is difficult or impossible to sell your Amway business because it is not recognized as a business in a legal sense. Business as a legal entity has to file for a permit with the city and register with the state. As far as I know, as an Amway IBO, registration with the state or city permits are not required. No one would want to buy a business without legal title.

Steve Amarillo

Anonymous said...

The diamonds made a lot of profit from tools and motivational pep talks but the profit earned is highly unstable because it depends on the number of downlines you have and if the rate of downline quitting is greater than the number of downline recruited to the so-called "business" then the diamond's profit from tools and bonus will decline at a significant rate.

Joecool said...

I will add that most IBOs will have shoddy and unorganized records which would turn off and real prospective business buyers.

Actually, if IBOs kept good records and watched their negative cash flow each month, maybe more would not join or quit even sooner when they actually track profit and losses.

Joecool said...

I agree and for that very reason, I believe there is no such thing as walking away from the business to enjoy residual income. If a diamond were to walk away, the tool and function money would stop immediately and the attrition would bring the business down to nothing pretty quickly.

Anonymous said...

People involved in Amway used to be called "distributors." At least that was honest. Platinums were called "Direct Distributors."

Changing a distributor's title to "Independent Business Owner" was pure hype and fakery. You don't have a business; you don't own anything; and you're certainly not independent.

Anonymous said...

When upline is really making money off of the tools/cds/seminars/events, is it all cash paid by downline? If it is cash being paid up, does that mean that upline isn't getting taxed on those things? I wonder...

Joecool said...

Yes, independent is a stretch. IBOs can't even advertise their own products without Amway's permission. In reality, an IBO is a commission only Amway sales person who must meet a quota (100 PV) in order to be paid.

Joecool said...

I'm certain that uplines can escape paying tax on functions and things where cash is used to pay for admission. Not so sure they can do that for product purchases.

Anonymous said...

Let's get some FACTS straight.. Amway business is done by the founding families (DeVos & Van Andels) , everyone who joins the Business Opportunity offered by these two wonderful & greatest Compassionate Capitalists , do their own business, "independent" because Amway don't dictate them (unlike in traditional job or distributorship) how to run , yes their are guidelines and policies similar to other aspects of life(like stop on red light ,go on green) to keep the opportunity equal for everyone.

Diamond quitting the business, understand what it means, he/she decided not to build his/her business and that's fine too.. It's their business it's their choice(again highlights the importance of "independent"),maybe they achieved what they wanted to with this business opportunity, in over 100 countries with over 5 million registered IBO's (talk of company promoting startup culture) and without much check before they allow almost anyone to sign the IBO contract,things are bound to happen(good or not so good).

Now coming to "tools", what are they first of all let's talk about them--Positive Mental Attitude Books, Listening from fellow entrepreneurs how they have successfully built their communities of business associates and customers, mistakes they made and lessons learnt, And finally the associations... "Birds of same feather flock together", so those who have entrepreneur mindset and those who want to learn come to them....
Again, from buying products from their own business(Directly from FMCG company) & other entrepreneurs who are affiliate partners, to tools (to educate & empower yourself) everything is Optional...

Now coming to Value of the business, it's unlimited because it's about each inidividual IBO, upto each of them how much they value themselves..

So if you want to learn more read some books written by people who studied it deeply and have facts -- Promises to Keep, Amway Forever-The Global Business Phenomena, An Enterprising Life By Jay Van Andel, Compassionate Capitalism By Richard M DeVos.


Hope, Wish & Pray that people will do their OWN independent research (and not search on search engines) thanks to Information Age they can do that and experience it by themselves, and for those who want to be part of it join it as the business tag line says--"Your in Business for yourself, not by Yourself though".

PS- I am keeping it anonymous so people don't think I am promoting my business.

Joecool said...

Sorry, you don't do your own business in Amway. Amway dictates certain rules that you must abide by or your forfeit your business or bonuses. You are not as independent as you think.

Diamonds quitting the business is significant. Why would someone quit or resign at the diamond level? Because they are not getting residual income like they claim to. The residual income is a myth. Diamonds keep working because they need the money, especially the tool money.

Positive mental attitude is good. Amway IBOs need this more than anyone else because they are all losing money except for a few big pins/

Association. Don't fool yourself. You're not hanging out with millionaires. You're associating with wannabe millionaires who are mostly broke and just hoping to strike it big in Amway.

And lastly, your Amway business is mostly nothing. That's why even diamonds at times, resign or quit and you don't hear about a diamond selling the business for a big profit.

Anonymous said...

Amway offers platform with growing ecosystem of entrepreneurs (brands you know like Apple, Home Depot & many others) to anyone looking for more value for money & helping their fellow beings get the same & doing that build a better future for generations to come.

Everyone definition of independence is different, hence every "I" interpretation of the business opportunity is different.
You say "some" quit, why then all of them don't quit?.There are guidelines on how to qualify for the "leadership bonus"(residual income is not the right terminology).

I hope you went to school-- paid fees to learn some skills & got a mindset , tools are used there too-- reading,listening & associating--why you think that is not bad? , think it over why people keep investing (spending for those who don't realize the value of that information), why people spend thousand of dollars for professional development or go to clubs etc, because if one don't invest in oneself, no other person will do.

Well, I don't know about your experience (and again it's "experience" a particular IBO have) , I do hang with some of them almost every week/quarterly/yearly (power of association), some of them still do their jobs(though not for paying bills),from Various professional fields--Doctors,Engineers,Lawyers,Army,Air Force,Professors and various other fields and some who don't have any formal education at all...(again formal education is helpful to gain skills and help you make living, self-education will make you millionaire(not just in $$ terms)--all entrepreneurs (not just IBO )understand this.
You again miss the point when you say "your Amway business", read the first line of my earlier post..IBO's don't do Amway business, they do their own and Amway acts as one of the suppliers for high quality FMCG products...
Every IBO build communities of pro-Sumer (read book- Pro-Sumer Power) & customers they personally serve.... And no one owns communities and hence when they quit they just get out of that community.

I hope this helps, and if still don't I strongly encourage to read the books first( get from library if you don't want to spend your own money for your own education).

PS- I am keeping it anonymous so people don't think I am promoting my business.

Anonymous said...

Not even Amway dares to repeat the old myth about residual income any more. The company specifically says that "there is no unearned income in the Amway opportunity," and directs that this NOT be claimed when prospecting recruits.

Joecool said...

I always say that when Amway zealots claim residual income and other myths. It it was true and a benefit, Amway would advertise it.

Anonymous said...

Concerning Anonymous from Jan. 14, at 3:22 PM:

Notice that the guy hopes that people will do "their own research" on Amway, but not via any "search engines."

Huh?

Search on the Internet is the primary source of information for persons today. All this guy can do is beg you to read Amway propaganda instead.

It only goes to prove that Amway is scared shitless of the Internet.

Joecool said...

Now that Amway can't hide thanks to the internet, it's harder to withhold important facts as people can just google it.

Anonymous said...

Source of Information Does Not Mean Source of FACTS.... Sure use Internet,infact Amway encourages to use Internet for Business,as folks can go DIRECT to them..leader in Direct selling Industry (Check Direct Selling News) FMCG products..

Joecool said...

The DSA has fuzzy information that often cannot be verified. Of course they have an interest in promoting MLM

Anonymous said...

To Anonymous of Jan. 19 at 4:22 AM --

Are you a lame-brain? All your garbled post says is "Yes, go to the internet, but only look at pro-Amway propaganda."

Is that a serious argument?

Joecool said...

Similar to IBOs telling prospects to seek information but only from people who are in Amway. As if people not in Amway cannot give you valid information about business.

Qiunan Tang said...

The very first class in college you would learn about how to do research and what sources are consider reliable. Internet sources are always questionable.

Joecool said...

If internet sources are questionable, so is your upline's word that they are wealthy, unless you have seen their profit loss statements.

Qiunan Tang said...

I am not sure what you mean. As we (me and my friends) are educated business people , we know the income formula , we have a rough idea of business cost, we can easily verify those number by doing a few easy research .

Anonymous said...

Go & check Amway Business Opportunity Brochure on Amway's website and read the income paid at various pin level for yourself, by empowering and serving people.
And because it's a Direct Selling company, no better way than to use Internet to go direct, as for pro, well that's the whole idea to educate con-Sumer to become pro-Sumer (Recommend Read- Pro-Sumer Power).

Joecool said...

The Amway brochure shows that only .26 of IBOs reach platinum. That's about 1 in 400. That's not a verg good rate of success.

Joecool said...

People who can properly evaluate a business would not find Amway to be a viable business opportunity.

Qiunan Tang said...

The 0.26 (let say you are right) That's because the very loose definition of active IBO amway has. Most of them are Just customers. Getting a IBO almost cost you nothing so talking about that success rate mean nothing.
Many businessman chose Amway, including quite successful ones. Stories and evdents are all there and can be verify if you come and see .

Anonymous said...

It's an opportunity, not a salaried job... And keep an eye on this Brochure as that number grows.Just FYI, 68% growth from 2004-2014 and with over 80 other brands joining hands the future growth is going to be phenomenal.

Joecool said...

It's a poor opportunity. Most IBOs, the vast majority make nothing or lose money.

Joecool said...

How do you know most are just customers? If that were true, how can anyone make money selling products? People would sign up and pay IBO cost and hardly anyone would sell products.

Anyway, that's just a myth. MLM company named Vemma claimed the same thing when the FTC came calling and when recruiting was halted, Vemma sales fell 95%. So where are all their "customers"??? I'll bet Amway is the same.

Qiunan Tang said...

in order to sign up to be an IBO you must have a sponsor. If you don't have one then amway system will assign one from data base (who must be a silver or higher and locate near you) . All my customer are paying IBO price as I would suggest they sign up, yet I still make money base on the commissions. Many People sign up as IBO just for purchase product, as I do so two years ago just because I like the XS drink better than others, so I sign up and get better price and get a little more cash back. I signed all my customer as IBO unless they refuse to do so just because it is better for them to do so. It also work for my interest . If you don't understand this , you don't understand amway business.

Joecool said...

So you're basically running an illegal oyramid. You don't get paid to sign them up but you need recruits to make your commissions.

Qiunan Tang said...

The commission is relate to the sales . You make money by selling product even you recruit no one at all.

Qiunan Tang said...

I don't have to sign them up in order to get pay. I am just telling true that signing up customer as IBO is a common thing to do and most IBOs should be doing it which make the number of IBOs on files much much larger than the real people actually doing it so it makes the avg success rate on paper much lower than the real one. I have about 20 downlines on file, but only two are in fact attending meetings and decide to do the business. Others just purchase product they like and share a bit when they have the chance .

Joecool said...

Why sign them up? By doing that you make no retail profit by selling products to them.

Joecool said...

What sales? If people sign up to buy at wholesale, you make no profit.

Qiunan Tang said...

Who tell you that ? You get pv and bv and commission and/or bonuses at the end of the month. Looks like even you made to 4000 pv but you still don't understand the business at all.

Anonymous said...

Sorry Joecool... You didn't get the business plan then...
GOD Bless you.