Build Your Upline's 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%+ of their revenue 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. If you have no guests to bring, you paid and received no benefit at all. The act of signing up first entitles someone to a lifetime cut of your volume. That doesn't seem like a level playing field to me.

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 the Amway owners and your upline, but 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 and function purchases for the priviledge of giving them bonuses with your product purchases. Dreams are being fulfilled, but not yours.

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 and your tool and function purchases. 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 regularly, 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. They don't want you to quit because their income is affected. Sometimes in business, quitting is a wise business decision that must be made unless you want to bleed money longer and longer. Quitting Amway doesn't mean you can't try something else to fulfill your dreams and goals. More than likely, any option you choose will be better than losing money in Amway.

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 or more 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, good luck to you, but remember this: Whose dreams are being fulfilled by your participation? Yours or your upline?

The Amway Illusion?

One of the things my upline taught us ad nauseum was that we needed to have faith in our business and in our upline. That we needed to believe that we were going to be successful. IBOs are told that they should act successful even if they are still working their way up the ranks in the business. It is why they ask (require) IBOs to wear suits and business attire to all meetings and functions. This is one of the weird quirks about the business in my opinion. I live in Hawaii and I remember a function they held in the middle of July in a high school auditorium and there was no air conditioning. I think my suit needed special cleaning because it was completely saturated with persiration.

Anyway, with this part of the year, soon there will be tens of thousands of IBOs shuffling off to a function called summer conference (AKA family reunion), or whatever it's called now. The tickets are about $250 to $300 and includes hotel and some meals. What IBOs are often unaware of is that many venues will allow you to run these conferences for $200 or less per person. The rest of that ticket prices goes directly into your upline's pockets. Anyway, the function will feature slide shows of mansions, yachts, jet skis, sports cars, fabulous vacations and other trappings of wealth. There may be some inspirational speeches and testimonies, but in the end, it's just a seminar that takes you away from your business.

What many IBOs don't realize is that this display of wealth is just that. There is no bonafide evidence to indicate that these diamonds actually own all of those toys and goodies. The diamonds probably won't verbally confirm it either, because these toys and goodies may not really be owned by them. It could be rented, or maybe some upline crown ambassador may own the mansion, but IBOs will assume that these trappings of wealth are common once you reach diamond. As an IBO, I never actually knew how much a diamond really earned. I just assumed it was a lot because we were shown all of these goodies and just assumed all diamonds had these kinds of lifestyles.

If I posted a picture of a mansion and a jet and said I owe it all to my earnings as a blogger, people would cry foul, that I am lying or making things up. And they would be right. Well, I would guess that many diamonds are doing the very same thing if they appear on stage and implying that they have jets and mansions. As I said, someone may own a mansion and a jet, but to imply that this is a part of the typical diamond lifestyle is a stretch. The evidence is there. Some diamonds have lost their homes to foreclosure. My old LOS diamonds (WWDB) taught us that diamonds pay cash for everything, including homes. Now confirmed as a blatant lie. Who knows what else they may have misrepresented?

I ask IBOs and prospects who may be attending these functions, to watch with a critical eye. What is being implied with the display of wealth? Analyze if those goodies can be purchased with a diamond income ($150,000 gross plus some tool income). Ask yourself if this lifestyle is truly sustainable? Ask yourself if you can live with yourself if deception is a part of earning your diamond lifestyle?

The Bait And Switch Scam?

Many prospects an even Amway IBOs are apparently unaware that the Amway business along with the insidious "tools" business is a bait and switch scam. Prospects are told that with some part time effort, they can achieve untold wealth and retire early. Many people get "fired up" at the thought of a shortcut to early retirement and wealth beyond their dreams. If the prospect gets excited enough to actually sign up, that's when the bait and switch scam occurs.

You see, if you register to be an Amway IBO and get involved with purchasing support materials such as books, CDs, voice mail and seminar tickets, you think you are on the road to riches as an IBO. Don't feel bad, many people have made this mistake, including myself. But when you register as an Amway IBO, you think you will be an "independent business owner". But nothing can be further from the truth. This is just an illusion that the upline will use on prospects.

When you register for Amway, you actually become a customer of Amway and a customer of the tools business run by upline. YOu purchase products from Amway, and if you purchase enough product, you might receive a rebate of sorts. 100 PV, roughly $300 in cost, will get you a rebate of 3%, or roughly $10. Your 100 PV actually generates about $100 in Amway bonuses, but the remaining $90 goes to your uplines. If you can sponsor downline who also use and/or move products, you can earn a greater percentage of a rebate, but in the end, you are still basically an Amway customer. As an Amway business owner, you can't easily advertise or do things to generate more sales without Amway's permission. You are also at the mercy of Amway in the event of a dispute.

As an Amway IBO, you are also a customer of the tools. Your upline will sell you an endless supply of materials which I listed above. What IBOs also don't know is that these products/tools also carry and larger profit margin than Amway products and, the rank and file IBOs don't get to earn any bonus of the volume of tools. And I might add that the tools may cost more than the cost of your 100 PV worth of products. So you buy in and you get nothing. I might add that the tools are ineffective, otherwise there would be a constant movement of people achieving higher levels.

Sure, Amway apologists will point out all of the new platinums, but they fail to mention that there are also thousands of people who were, but no longer qualify as platinum or higher. Amway sales were at 11.8 billion in 2013 but sales have dropped more than 25% since then, with Amway doing in the neighborhood of 8.5 billion last year.

So for prospects and current IBOs, I hope you realize that you're not really an IBO, but a customer of Amway and a customer of the tools. How many customers do you know of that became wealthy by purchasing things? I can't think of any.

Diamonds Pay Cash?

When I was an Amway IBO, I was always taught that diamonds pay cash for everything. That one day, after following the foolproof WWDB system, that I too, would be strolling on the beaches of the world, with cash rolling into my bank account with no worries in the world. We were told that diamonds pay cash for all purchases, even homes and other large ticket items. As evidence, the diamonds would show slideshows of mansions and sports cars, golf club memberships and other lavish items. All paid for in cash we were told. I have reason to believe that WWDB still teaches this except that it is more than likely a bunch of lies.

You know what's really sad? Shortly after I left Amway and WWDB, I bought a home (in Hawaii) for about $300K. My sponsor was my friend and the real estate agent also contacted him to see if he was interested in purchasing a home. He declined because he said he would only buy a home if he was able to pay his home off in cash. Well, it is now about 20 years later and my home is now worth close to a million dollars and my former sponsor is renting a home. This is just an example of how dangerous it can be to follow upline's advice.

First of all, in looking back, our group really had no way of knowing what was paid for or not. We just assumed that diamond made so much money that everything the diamonds spoke of were true. However, there have been events, some fairly recent, that exposed some of the apparent lies told by these diamonds. There were two (2) diamonds whose home foreclosures became public knowledge and a prominent triple diamond who was involved in bankruptcy (chapter 7) proceedings. Now your home cannot be foreclosed if it's paid for in cach right? Technically, nobody would care whether a diamond's home was mortgaged or paid for, but when diamonds parade in front of a crowd bragging about wealth, and then telling the audience that they too will achieve the same success by following the system and upline advice, well that's a bit misleading in my opinion. So many people in the audience are practically crying because they want (so badly) what the diamonds are flaunting, except that possibly, many of these diamonds don't even have what they are selling.

An average (non founders) diamond might make about $150,000 (according to Amway) and let's just say another $150,000 from selling support materials. When you factor in taxes and business expenses such as travel to and from functions, what's left over certainly is not going to allow you tp purchase million dollar mansions. Some higher up pins might make a bit more, but still, purchasing mansions and other luxuries in cash is a stretch. It would be my guess that most diamonds indeed have a mortgage on their homes and may even have car payments. That's not a crime but it is unethical and it is illegal to lie about your income in order to recruit new downlines.

For IBOs and other newbies, if your uplines are bragging about paying for homes and other things in cash, ask them to show proof of these claims. I can show you pictures of multi million dollar mansions and sports cars, it doesn't mean that I paid for them in cash. But then again, admitting to having a mortgage or having monthly car payments aren't quite as attractive or exciting as claiming to pay for these things in cash.

Amway Disastrous From The Start?

I was thinking about how Amway prospects are invited to see the plan. In many cases, there will have been a bit of deception or half truths told in order for an IBO to get a prospect in front of the plan. But then I thought about the plan and how much deception was used in the plan itself by the speaker.

Thus, IBOs and new prospects are deceived right from the beginning. The speaker might make some small talk, and get the prospect to agree on certain small issues, such as income tax and insurance eating away at your paycheck, etc. When a prospect hears this, it will make sense and they will tend to agree and trust the speaker somewhat. After all, the speaker has been built up to be a financial whiz and all.

Then the deception begins.............

The speaker might talk about IBOs saving 30% on products right from the start, which is false. Anyone who's seen an Amway catalog can easily see that you aren't saving 30%. Just walk the aisles of WalMart or Costco and you can easily compare prices. Amway products in general, cost more than comparable products at retailers or big box stores. Amway defenders claim that WalMart doesn't sell Amway products to defend their story, but WalMart sells shampoo and laundry detergent and cleaners which often cost a fraction of what Amway charges.

Then the speaker might talk about 98% of people being dead or broke by age 65, which is not true. The speaker might talk about 90% or more of small businesses failing in the first five years. These little factoids (which are untrue) are apparently used to make other opportunities seem flawed in comparison with the Amway opportunity. If anyone does their due diligence, you will see that many of these claims made by the Amway speaker (recruiter) are also false.

The speaker might then talk about how the Amway opportunity is cheap to get started, and has little or no overhead. But the problem is that many dedicated IBOs will get hosed as their upline will begin to teach them that they need to invest in their business in the form of voicemail, book of the month, standing order and attending all meetings and functions. These expenses nearly guarantee that an IBO will end up with a net loss of income. What's more, upline may teach that this is success! Appalling!

So a question for IBOs and prospects. Is it a good opportunity when you have been lied to or deceived right from the outset?

Tidbits For Amway Prospects?

One thing that I was unaware of as an IBO was that our uplines were massively profiting from our tools purchases. I was in WWDB at the time and I was told very clearly that nobody made money from the tools and in fact, I was also told that WWDB was a non profit organization. Both of these statements were bold lies told by WWDB leaders and they have never been held accountable. We were told that upline cared about us and our success, thus they spent their own money to fly to functions to teach us how to succeed. Turns out they were all lies.

Eventually, the internet amd other media made it impossible to cover up these lies and uplines finally admitted that they profited from tools. However, it looks like they downplayed the magnitude of the tools profits. I believe some upline may have made most of their income from tools, especially leaders who may have fallen out of qualification. Now days, the upline admits they make some profits from tools, but there is still a great deal of secrecy in the tools business. What makes the whole thing ironic is that the uplines allegedly are not supposed to entice Amway prospects into joining by using the tools money as a draw, but at the same time, they are told that tools are vital to their success. Uplines also show off trappings and lifestyles to attract recruits, but I believe that these trappings were likely obtained with tool income. Tool income has a higher profit margin than Amway products and fewer people are in the pay plan so it makes perfect sense.

I wonder how many prospects or IBOs would be fired up about buying tools if they knew that their uplines might not currently be qualified at the level they claim to be, and knowing that the uplines will make a ton of money whether or not you make a cent as an IBO? Also, some uplines are shameless in pushing the tools on downline. Sure they might cut the newest guy a break and loan them some cds, but once that IBO decides to start building downline, they are likely to be told that a real business owner buys their own tools, or that a business owner needs to be a leader and purchase extra tools for their downline.

How would you feel if your upline was touting themselves as a financial genius but in the background, their homes are foreclosed or they have other financial difficulties? What if your upline touts their morals and you find out they are divorced or getting a divorce? What if your upline said Amway saves marriages? Your upline certainly won't say they are perfect, but conversely, they should be held to the highest standards if they are using their status to be able to sell tools and make large profits. This is something too many prospects are blind about.

Ineffective Amway Training?

After years of studying Amway and blogging, I've noticed some things taught by IBO leaders that simply do 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". These same leaders may encourage you to disregard facts and just follow them. Blind loyalty like that can end up costing you a lot of money.

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. The training might motivate you with the "rah rah" tactics, but in the big picture, are ineffective in generating more sales and getting IBOs to sponsor more people. If Amway tool and training worked, Amway sales would far greater than the approximate 8.3 billion they did last year, which is down more than 25% since 2013.

Also, "buy from yourself:, a fairly common practice, is a bad idea. 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. Also, for this reason, IBOs are always recruiting because they need downline to try to generate more sales volume. But because sponsoring people into Amway is nearly impossible, most people wind up recruiting but never sponsoring a single downline.

Sponsor others. So you are struggling as an IBO. But the key to success is to try to open other stores by sponsoring downline. As a famous Amway apologist likes to claim, you do not get paid (directly) for sponsoring others. So why is this the emphasis for so many IBOs? Why would you think that opening more (Amway) stores will make you successful when you are running a failing Amway store yourself?? Yes, it is a way to possibly generate more volume, but your "success" will only come by having a bunch of struggling businesses sponsored by 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 inviting someone to see the plan.

Folks, a business needs 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 unless your job income continues to fund your Amway business. But I'm assuming you don't work a job just to keep your Amway distributorship going. Bottom line, if your Amway business can't support itself through sales, why are you still running it?

Are You "Buying From Yourself"?

One of the biggest shams taught by some upline is the nearly exclusive "buy from yourself" philosophy. I'm not saying that supporting your business is a bad idea, but are you really supporting your own business? If your upline teaches this, you are being mislead and I will explain why.

When you think you are buying from yourself, you are really buying from Amway. Amway makes the profit from the sales. If you buy enough, they toss you a small rebate. Basically, you spend about $300 and get a rebate of $10. An IBO is in reality, a distributor or a middleman. Also, if you are a new IBO at the 100 PV level, you will receive 3% in the form of a bonus while your uplines and sponsor will split up approximately 29% to 30% in bonuses off your efforts, thus you get about $10 while your uplines will enjoy a share of about $90. Also, your upline might say that the "profit" you make from buying from yourself is the same as if you shopped at Costco. But wait a minute, if you shop at Costco, you get to keep the savings. If you earn a profit in Amway, you'll likely be expected to use that profit to spend on tools and functions.

Think of it this way. If your spouse was in the business of making and selling cookies, would you make money by eating all of the cookies? Even if you received a small rebate for cookie making materials, you would not profit by eating all the cookies yourself. You would have to sell the cookies to customers to have cash in your pockets. I truly do not understand how IBOs get duped into thinking they can be successful and earn money buy purchasing and consuming Amway products without selling much. Amway's own numbers suggest that IBOs do not sell much, except to their own downline and to themselves.

And upline who sell tools that teach this method are more than likely selling you a flawed system that nearly guarantees you will lose money. A rare few IBOs will emerge now and then who can overcome overwhelming odds and barriers and reach higher levels in the business, but I would have to say that more than 99%+ of IBOs who sign up will never even get close to emerald or diamond. Sadly, the buy from yourself system will only profit the higher level distributors, as well as your purchase of tools, which rewards upline for teaching a flawed system.

Personal Responsibility?

One of the disturbing things I have noticed about Amway IBOs and IBO leaders is how they wlll tell downline to trust them. To trust them as they have already blazed a trail. No need to re-invent the wheel. Just ride the coattails of your upline to success. The system is proven. Many IBOs take this to heart and put forth tremendous effort. Then when they fail, upline will shun them and tell them that the failure is their own. That they are personally responsible for failure. Why should IBOs trust in their upline and then be held accountable for failure even if they did everything they were asked to do?

Now I am not talking about IBOs who sign up and do nothing, or never place an order. I do believe that the fact that many IBOs sign up and do nothing brings concerns about how these IBOs were recruited, but I do not recall ever seeing an IBO do nothing and then complain that Amway was a scam or anything like that. But many IBOs who put forth real effort should see success if they do as they are advised. But still, this doesn't seem to be the case when you analyze Amway in depth.

I have found, however, that many people who are critical of Amway and the systems, put forth much effort, did everything they were told, and did not find the success that upline promoted, or in some cases, guaranteed. My former sponsor was still active last I heard and has been in Amway for over 20 years. I do not believe he has ever gone beyond platinum, and I know that he was never a Q12 platinum. Some Amway apologists might see being a platinum as a bonus, but when you are hard core sold out to the systems, platinum is a break even or make a small profit business at best. . Factor in that time spent by husband and wife and these folks are breaking even or making a fraction of minumum wage or even taking losses, depending on your level of commitment.. Is this the dream that will allow you to buy mansions with a cash payment? A couple working for break even money is wasting their time. Their kids lose valuable time with parents and the net result is negligible. How many people will actually look back at their time in Amway and say the time was well spent?

What is also disturbing is how people will tout the system as responsible for any success, but hide the vast majority that the system doesn't help. Sure, some will succeed in Amway, but for every success, there are hundreds or more likely thousands who fail. And if you consider diamond as the benchmark of success, the failures could be in the millions. As I said, some succeed, but very very few in relation to the number who try. Going diamond is probably less common in the US than winning the power ball lottery. I've heard of more big lottery winners than new diamonds emerging in Amway North America.

Succeed and the systems and upline take credit, but fail or quit and it is your own responsibility even if you did the work. Are these the kinds of leaders or mentors you want advice from?

JoeCool Published On Forbes

One thing I recall one of our upline diamonds saying was that Forbes had credibility because they had published something that was somewhat positive about Amway, although this was back in the 1990's. This article is a re-print but one that I believe is very relevant and worthwhile because it's about taxes (and we are in tax season) and because the article in Forbes directly quotes an article written by yours truly. I have provided a link and the quoted portion of my blog article:

https://www.forbes.com/sites/peterjreilly/2016/06/25/tax-court-denies-amway-losses-due-to-lack-of-profit-motive/#51bdaa493ab6

The article was written by Peter Reilly who quoted my article. It's about how the tax courts basically hose Amway IBOs who try to use functions and other excessive tools as tax write off, which are promoted by some upline. Mr. Reilly states that the tax courts seems to align with what critics (such as JoeCool) says:

""Tax Court Seems To Align With The Critics

What I found most intriguing about this decision, is that way that it mirrors critiques of the Amway experience, which seem to have their own section of the blogosphere. For example Joecool of Amway - The Dream Or The Scheme? recently wrote in a post called Amway Success?""

Submission to upline was one of the things we were told. Our group was told that upline would never purposely lead us astray so we should trust them and never try anything without checking upline.

Our group was taught to reduce debt, but ironically, upline said it was okay to go deeper in debt if it was to attend a function or to buy more cds.

Anytime we asked about how much income uplines may have been earning, we were either told it's none of our business or shown a photocopy of a 10 year old bonus check that someone upline may have received. Our proof that the business worked was upline showing off pictures of sports cars and mansions.

Losing money is success. Many times, our group was told that losing money was a sign of success. It was success because we were investing in our futures. That the business really is not about money but about friendships. I suppose upline taught this because everyone was losing money so it was nice to hear that success was around the corner, and that we were all nicer people and on our way to success if we just attended more functions and bought more standing orders.

JoeCool is on Forbes. I guess that makes me legit!

Amway Diamonds Are Free?

When I was an Amway IBO, I often saw my upline diamond driving around town dressed in a business suit. I used to think why does he keep working if he can walk away and collect residual income? My sponsor told me that the diamond only works because he cares about his downline and wants to help them. So there are two possible scenarios, the diamond is working to help his downline out of a genuine concern, or possibly he is working because he has to! The only difference now is that the diamond works the night and/or graveyard shift, because many IBOs are building the business after they complete their day jobs. **We should also note that my former upline diamond dropped down to the emerald level around 2005 and has since re-established his diamond level. And this diamond moved from Hawaii to Washington State (Due to a lower cost of living???)

Now Amway once stated that the average diamond (non founders)earns about $150,000 a year. That is a decent income, but after taxes and paying for basic expenses such as medical and dental insurance, the average diamond probably lives a very middle class lifestyle. Keep in mind that a large portion of a diamond's income comes in the form of an annual bonus, thus a diamond's monthly income may be quite small. Yes, diamonds may have other sources of income such as speaking engagements and income from standing orders and functions. But income from speaking engagements and other functions depends on the diamond's continued appearances and efforts.

So is it likely that a diamond is "free"? I can only conclude that a diamond is not free, and may actually have to spend more time maintaining his group than if the diamond simply had a 9-5 job. (You could argue that a diamond's duties are preferable to a 9-5 job I suppose) For one thing, a diamond needs to maintain a personal group to keep qualifying for bonuses. With a poor retention rate in Amway, I am fairly sure that a diamond spends much time recruiting personally sponsored IBOs to maintain this group. Additionally, a diamond must help his six or more groups of downline platinums to maintain their businesses or face the possibility of falling out of qualification. My former diamond dropped down to the emerald level but apparently later re-qualified at diamond. A diamond must also dedicate time to reward up and coming movers and shakers, to keep them motivated. I got to spend time with my upline diamond when I was considered a promising up and coming pin. All of this takes up valuable time and diamonds can get spread pretty thin at times.

In order to continue to receive tools income, a diamond must also travel to numerous functions and speaking engagements. Although the tools income allegedly doubles a diamond's income, it also adds a lot of expenses, especially if the diamond and his family travel first class and/or take fancy vacations to show off the diamond lifestyle.

After breaking down projected income and considering projected expenses, I can only conclude that a diamond probably lives a middle class lifestyle, and probably works as much as a man with a 9-5 job, except that a diamond works nights and weekends. A good portrait of this is shown in Ruth Carter's book (Amway Motivational Organizations: Behind The Smoke and Mirrors). In the book, the diamond had a net income of over $300,000, but lived in debt, could barely pay his mortgage, and was always on the run from one function to the next. A high income means nothing if you live beyond your means.

I believe that diamonds may actually be busier at the diamond level than an average Joe who has a 9-5 J-O-B. The difference is that the diamond works the night shift. Is this the freedom you are seeking?

The Ineffective Amway Tool System?

In the Amway business, most active IBOs are advised 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?

Things To Do Besides Amway?

One of the humorous things that Amway IBOs often bring up is that someone who sees Amway in a critical eye should bring up viable alternatives. I mean if someone prevents you from falling over a cliff, they should have warned you and given you alternatives right? If I recognized you getting were conned by a conman, I should find viable financial investments for you before warning you of the potential scam you are about to walk into right? It sounds completely ridiculous but Amway IBOs have actually made those comments on this blog and some other Amway related websites.

Well, let's explore a few of these alternatives anyway just for fun. How about you stay home and do nothing? For most IBOs, you would be better off financially than committing your time and resources into Amway's products and their ineffective training materials and functions. If you are really dedicated to tools, sending your upline a check for $50 monthly and not buying Amway goods or related training materials would make you better off. Isn't it ironic that
doing nothing makes you better off than Amway?

A second job where you actually receive a paycheck is a better alternative. While there's no hype and hopes of getting rich in 2-5 years, you can do much for your future by saving a portion of that pay check each month. If you are young, this especially applies to you. But anyone can help their future by saving and investing. Even someone who panhandles is more likely to have more net cash than most Amway IBOs since most Amway IBOs make nothing or lose money.

Sure, some people do make money in Amway and some make a lot of money. The problem is they make money by exploiting their downlines and those hopeful downlines basically have no hope. In other words, you profit by selling false hope and false dreams. Basically, you can gain wealth in Amway by being a conman. Can you live with yourself in order to profit at any cost? What the upline does is extract $100 or a few hundred dollars a month from a lot of people.

I haven't even gone into the amount of time lost chasing prospects and attending functions. Your time might be the most valuable commodity that is lost chasing the 2-5 year dream. Ask yourself this question. Where are these diamonds who did the 2-5 year plan living in luxury and doing nothing? I have asked this over the years numerous times and not a single Amway defender can name someone and provide a shred of evidence that it's true.

No Profit For 5 Years?

One of the things I heard as an Amway IBO and I believe is still said in some Amway meetings is that conventional businesses do not profit for up to five years. That's bogus. Conventional businesses make a profit as soon as they sell their first product. They may not have a net profit right away because of the initial investment into equipment and rental property, but they do profit by selling goods. The same principle would apply to an Amway business except that Amway IBOs have difficulty selling products. If you opened an Amway catalog and compared their prices to local retailers, you would know what I'm talking about.

Despite the small start up costs and the little to no overhead costs, most IBOs never turn a profit. I will acknowledge that many IBOs probably never do a single thing once they sign up. I believe there is an underlying story behind this as well, but I will move on. Out of the more serious IBOs, even in this group, most of them will never make a net profit if they are using tools. Factoring the cost of the website, the voicemail, standing orders, books and functions and cds, IBOs simply get drained of their money a couple hundred of bucks a month at a time. Amway uplines meanwhile, are earning nice profits on product purchases and someone upline are also earning profits on the tools. The tools carry a higher profit margin so it would make sense that some uplines earn more from tools than from Amway.

Toss in other challenges such as high prices for many products (higher than local retailers) and a crappy reputation from IBO behavior such as tricking people into meetings and you have an opportunity with nearly insurmountable handicaps. Yes, a rare few and usually charismatic people can overcome these odds, but only one or two out of tens of thousands are able to do so. And even those who reach the pinnacle of diamond, may not be able to maintain qualification. It's very common for someone to reach the level of emerald or diamond only to backslide and not qualify the following year. So much for residual income and walking the beaches of the world.

So I don't know all of the detailed statistics about how long it takes for a conventional business to turn a net profit. It may take up to five years. But based on my experiences and some number crunching, I'd have to say that the vast majority of Amway Business Owners NEVER TURN A PROFIT - EVER, and most of them ending up with net losses when business expenses are factored in. And toss in the fact that Amway allegedly has little or no overhead costs and I can only conclude that the Amway opportunity sucks.

Amway Or College?

Many Amway IBOs justify their involvement in the system of cds, tapes, books and seminars by comparing it to college. They claim they need this education and that it is much cheaper when compared to a college or university. Of course this is the upline propaganda that IBOs are fed, much like the concept that a job is a bad idea. If recruiters are encouraging you to build Amway and to drop college, I would run away as fast as possible. It is well documented that college graduates in general, earn much more than non college graduates. I'd also mention that college was a fun experience for me. I might add that nobody is going to guarantee you in writing that Amway will make you better off.

In college, it is true that not everyone graduates, but approximately half of those who start college end up graduating. Those who do not graduate still benefit from their education on a year to year or course by course basis. When you are job seeking, a college degree will give you more options than those who don't educate. This claim cannot be made by Amway IBOs. The education an IBO receives by seminars and cds do not even equate to success in Amway, much less in other venues in life. Only a small fraction of IBOs ever reach platinum, which supposedly is the break even point. So as an IBO, you have less than one half of a one percent chance to break even as compared to approximately a 50% chance of graduating college.

Also, once you graduate and receive your degree/diploma, it is complete. You have your degree and no more education is required. In Amway, your education will never end. You'll be expected to invest in the tools and functions forever. Also, in Amway, there are many many many examples of people who reached levels as high as diamond or above who could not maintain the level. There are also many examples of diamonds who quit Amway. If there were such a thing as "residual" income, why would anyone quit when they could sit back and watch the cash roll in. I think the answer is quite obvious.

There is also no evidence (as far as I know) that your Amway related education of cds and seminars actually work. The tiny fraction of 1% of successful IBOs is not a good case for arguing the success of the system. Colleges on the other hand, have accreditation standards, which is nothing like the ineffective Amway accreditation of groups such as BWW, WWDB or Network 21. The results are quite telling if you look at them analytically. There is no question that a college education and the college experience will be far more rewarding and beneficial to your life than running an Amway business. I know which choice I would make if I have to pick one or the other. College wins hands down.

The fact that IBOs even dare to compare a college education to their teaching in Amway is a joke. Try telling a prospective employer about your Amway education and see what that gets you. LOL

Amway's Ineffective Tools?

One of the things my Amway upline always pushed on us was the tools system. While the tools are said to be optional, they are not promoted that way. They were promoted as vital, necessary, almost as if you were insane to try and build an Amway business without tools. Basically the tools were a defacto requirement. My upline always claimed that nobody ever "made it" without tools. Some Amway defenders insist that the tools work, and that IBOs who were on the system proved it with higher levels of success and product volume. But the tools work for maybe a fraction of 1% of IBOs who try them. The vast majority of people who use tools make nothing or lose money. Similar to a lottery.

IBOs participating in the system (voicemail, book of the month, standing orders, functions, etc) do more PV. I believe this is true, but it is true, only because once the upline can convince you to participate in the system, then that same IBO is also convinced that they should or must do 100 PV as part of the deal. People who aren't convinced that the system is vital, subsequently do not purchase or sell as much PV because they have not been convinced that moving PV will make them successful or wealthy.

Critics and Amway supporters have debated this issue for years, but clearly, the evidence supports my position. Why? Because if there was a true demand for Amway products because of their quality and/or value, then there wouldn't be such a steep drop off in movement of volume when an IBO becomes a former IBO. Many, probably most former IBOs never buy a single Amway product once they leave the business. If the products had true quality and value as Amway supporters claim, why don't people continue to purchase 100 PV per month when they quit? Because they never wanted or needed all of that product in the first place? If former Amway IBOs continued to but products, Amway sales would continue to increase. Amway's sales and revenues dropped more than 25% from 2014 to now (2018).

If someone is convinced that Amway will be their financial savior and that by using tools and moving 100 PV will result in long term financial security and residual income as claimed by upline, then that is what they will do in hopes of achieving the end goal. When that goal or dream doesn't materialize, the former IBOs realize that the tools and products no longer have the value they once thought they had. How many former IBOs will buy standing order or attend functions? If these materials really made you nicer, or saved marriages, why don't any former IBOs keep buying them? Why do they resort to selling them for pennies on the dollar on Ebay or Craigslist? What happened to the great return policy?

Bottom line is that the tools don't work. They only work for the uplines who directly profit from the sale of tools, plus the artificial demand in product sales created by those IBOs who are convinced that Amway wil make them rich. Once the reality sets in that Amway will not make them rich, and that the tools are simply draining their resources, then the demand or tools and Amway products disappears almost instantly. There is no unbiased evidence that I know of to suggest that these tools work, and basically, the miserable amount of new diamonds emerging in the US seems to confirm this fact.

I'm A Business Owner?

Many people get prospected into Amway and think it's a cool idea to be a business owner. "I own a business". And technically, it would be cool for someone to own a business they can call their own. But what Amway distributors fail to see is that they aren't business owners. If they sign up, they are commission only sales people for Amway. These sales people take all the risk and expense of moving Amway products, and if you meet a minimum quota, then you get a small commission.

These commissioned sales people however, are allowed to sponsor down line (additional sales people) which allows them to increase volume, possibly resulting in higher commissions. To illustrate, someone who moves 100 PV receives a 3% bonus. On 100 PV, a 3% bonus is about equal to $10. But if that same sales person sponsors 2 people and they all move 100 PV, that would be 300 PV which is now a 6% commission. A 6% commission on 300 PV is about $36 overall. The 2 down line each receive $10 and the person who sponsored them keeps the rest, which is about $16. This is the reason why Amway sales people are so desperate to sponsor down line, because it gives you an opportunity to increase your overall volume, assuming these down line are active in the business. This in itself wouldn't be a problem if Amway products were easy to sell, but most people find that they don't really like selling products and wind up being their own best customer. That results in most people making nothing or losing money.

So why are the diamonds called business owners? Because the diamonds are business owners, even if the rank and file distributors are not. This is because the emeralds and diamonds and some other higher ups are in the business of selling tools. They might sell voicemail and cd subscriptions, books and seminars and other materials designed to allegedly help you succeed in Amway. Given the dismal rate of new diamonds around, I'd say the training is ineffective. I believe there are fewer new diamonds in Amway North America now than when I was in Amway 20 years ago. I've also seen diamonds walk away and quit (as opposed to walking away and collecting residual income). I've also seen diamonds get divorced (Amway saves marriages?) and I've seen diamonds have homes foreclosed (diamonds pay cash for everything?).

The problem for the rank and file Amway sales person is that they believe the diamond holds the key to success so they hang on their every word and will buy all the training thinking they will also go diamond and receive untold wealth and early retirement. But in reality, the diamond is selling snake oil that puts money in their pockets while draining the pockets of their down line. And the diamond needs this money because it is highly unlikely that the "diamond" lifestyle would be affordable on a diamond's income. The average diamond as reported some years back by Amway was about $150,000 a year gross income, not including business expenses. If you do the math, you will easily see that after taxes and expenses, a diamond is not living the high life. It's the tool income that helps to augment the Amway income. Some diamonds make as much money on tools as they do from Amway and some make more from tools than from Amway. This is the secret to success. Sell materials to large groups of people on an ongoing basis.

But don't be fooled into thinking you own a business as a rank and file Amway distributor. You are just a commission only sales person for Amway. If you stop and really think about it, how can you see it any other way? You move products and if you meet a quota, Amway pays you. You must follow Amway's rules and if you violate it or if Amway feels you were in violation, they can discharge your membership and your income will stop. You cannot innovate or advertise without Amway's permission. Don't fool yourself. Take this information to heart if you are being prospected into Amway.

Amway IBO Expenses?

Many uplines will use slightly deceptive recruitment tactics when getting new people to see or register into the Amway business. One of the common things was how joining Amway has very little risk, no or very little overhead. This is true, if an IBO is not involved in any of th system related training. However, it is the goal of many if not most uplines to get as many IBOs involved in the system as possible. This is probably because selling standing orders, voicemails and seminars has a higher profit margin for some uplines than the actual movement of Amway volume. So some newbies might join thinking Amway won't cost them much, only to find out that 100 PV might run them more than $300. They may not be aware that standing orders and functions never end and can add an additional cost of up to several hundreds of dollars more. Uplines will then justify the expense by saying the IBO is investing in his/her business.

New IBOs, and especially IBOs who are single should seriously think about the cost of being a business building IBO before joining. Many or most prospects don't know that building an Amway business using system tools and "coaching" can cost them up to $500 or more each month. A single person more than likely cannot possibly consume 100 PV worth or products on a monthly basis unless they almost exclusively consume XS drinks and Nutrilite vitamins. And secondly, how many singles or prospects were consuming cases of energy drinks and vitamins ($300 monthly) before being presented with the Amway business? How many people were willing to fork out hundreds of dollars for a weekend function that may require airfare and hotel stay? I don't think too many people like this exist. But I believe they do so because they have been sold a dream of financial freedom, of early retirement and not having to work a job anymore. But the evidence would suggest that once the dream disappears or reality sets in, how many (former) IBOs continue to purchase Amway products and attend seminars?

I know of many former IBOs and I don't know of any who purchase Amway products on a regular basis and I don't know of ANYONE who has ever forked out money to attend an Amway/AMO function after they stopped being an IBO. Amway's numbers bear out this claim as there is very little sales to people who are not IBOs. The IBO salesforce is responsible for consuming the lion's share of Amway's products and services. I myself have purchased an Amway product or two since I left the business. But I did so only to humor friends who were still in the business. They have all since quit. It is very reasonable to conclude that once the desire to build the business stops, the desire to purchase Amway products also stops.

Most eager young and motivated people who sign up often do not realize that these IBO expenses exist. While Amway acknowledges that these tools and systems expenses are optional, the uplines who promote the tools may suggest that it is insanity to attempt to build an Amway business without the tools or strongly encourage new IBOs to partake. A common statement was that we "needed" to be at the next function no matter what. Missing it would set your business back six months. New IBOs and prospects don't know better so they will often conform. Sadly, there is ZERO unbiased evidence that the tools and seminars do anything to increase IBO volume and/or the sponsorship rate. In my informed and experienced opinion, the tools are ineffective and the vast majority if IBOs would be better off handing their upline a monthly check for $100 and not building the business or buying any products.

IBOs and information seekers should be awar of these potential IBO expenses and determine if the expenses would be worth your while. Keep in mind that someone upline profits handsomely from the tools, even if you do not make a cent from your Amway business. You should have your best interest at heart, no matter what your upline tells you.