Getting Out Of Debt BS?

One thing that many Amway/WWDB IBOs tout is how their upline teaches them to get out of debt. While on the surface that sounds like an awesome thing to do, it's not what WWDB mentors are actually doing. They want to give the appearance that they have your best interest in mind and that they want you to succeed. At least that's what they want you to think. Sadly, many IBOs get sucked into believing this. I will go on to explain why this is and to give prospects and information seekers some food for thought.

If you have an open mind, you will see my point. Prior to someone joining Amway, they most likely didn't buy any Amway products and certainly didn't focus on spending about $200 to $300 monthly on buying household products, especially if they are single people. So how is buying more stuff than you used to, supposed to help you get out of debt? All you are really doing is sacrificing things you used to enjoy to spend on Amway stuff. If you actually made a net profit from your Amway business, that might be okay. But most IBOs are making nothing or losing money while being taught to never quit or that success is right around the corner.

If your upline or mentor is teaching you to get out of debt, are they also advising you to invest any "extra" money into investments? Are they teaching you to plan for the future, in case the Amway business doesn't pan out? Are they advising you to save money? More than likely, the answer is "no".

Your upline will be advising you to use any money you have available to invest in tools and functions. WWDB premiere club, download audios (at a charge), standing orders book of the month and attend all functions. You will be advised to do this even if your business has not made a cent in profit. But you say your sponsor or upline loans you tools and pays for your functions? That might be true, but guess what? Once you sponsor someone, you will be the one loaning tools (that you paid for) and/or paying for your downline's functions because with a downline, you are now a "real business owner". It's amazing how so many people get fools into believing that upline wants you out of debt for your own good. Upline wants to out of debt for upline's good. For that reason, you might be told to get to the next big function at any cost, no matter what. That your business will be set back months or years if you miss it. The reality is missing a big function might be your wisest financial decision.

Your upline may want you out of debt, but they more than likely have their own interest at heart and not yours. Look at it objectively and ask your trusted friends who are not in Amway what they believe. This is advice from someone who has no reason to lead anyone astray. I experienced this and fell for the trick as a young and hopeful dreamer. Now I am hopeful that my experience can prevent others from falling into the trap that I fell into.

How Your Upline Gets Wealthy?

A recent comment left on my blog inspired this article. The comment was that basically, IBO's are "donating" to their upline on a monthly basis. You start by donating upline in the form of monthly purchases. Your 100 PV is roughly equal to $300 and most of the bonus generated by that volume goes somewhere upline. This will go on forever until you either quit and stop buying, or unless you somehow manage to sponsor enough downline who will then "donate" to you.

If you attend those open meetings, you are again donating to the upline's coffers. As an IBO, I was strongly encouraged to attend these meetings even if I had no new prospects to bring. And of course, there was an entrance fee at the door. I don't think this was a major profit center but still, a room with perhaps 1000 attendees = $6000 collected and a room with chairs and a speaker doesn't cost that much for an evening.

If you purchase standing orders, you are donating to your upline on a weekly basis. If the upline can reproduce audios for 50 cents or even a dollar a piece, this is a very healthy profit center. Also, most upline recommend that you listen to a cd/audio each day, thus you need to purchase some additional audios/cds in addition to the standing orders.

Voicemail and book of the month are also monthly donations. Who in the world needs voicemail these days? But uplines still recommend it as they make some serious coin from it. The book of the month might have some value but the uplines are still making profits from these. Think about it, these diamonds claim they want your success but they make you pay for just about any help you receive, regardless of whether that help is beneficial to your business or not. By Amway rules, your sponsor is supposed to train and motivate you free of charge.

The regional and major functions are like the monthly fund raisers for the diamonds. Major functions can have thousand or tens of thousands of people in attendance. If they pay $100 (or more) each, it is a serious money maker for upline. A convention center or arena has costs in running events but those costs (while they vary) might be $10 to $25 per person. The rest is pure profit for the diamonds.

All in all, the profit margin is much higher for these tools and functions than from Amway products. Thus it's perfectly reasonable to think that the diamonds can make much more money from selling tools than from Amway itself. For groups where current qualifications are not required for a cut of the tools, these diamonds might make nearly all of their money from tools and functions. It's more like a diamond fundraiser than a function to help IBO's. Afterall, who gets the biggest financial benefit from the tools and functions? The diamonds or the IBO's?

What Profits?

I find it humorous when so many Amway IBOs talk about their anecdotal stories of success, or talk about how their system teaches a foolproof way of succeeding in Amway. Yet I have not seen a single IBO who was willing to describe their business structure or talk about how they progressed from zero PV into a profitable structure. Amway's biggest defender, David Steadson AKA IBOfightback is a good example of someone who can talk a good game but cannot back it up with evidence of any success in Amway. In fact, where is David Steadson these days? Looks like he's finally dropped out of the Amway debate.

Back in my IBO days, WWDB leaders would teach that someone who could talk a good game was a teacher, and not a doer. Many IBOs may have a good theory about how to build a business but evidence clearly shows that it is talk and not action. One specific example is how an IBO is supposed to find 20 customers who each buy 20 PV from an IBO. Nobody I know of or heard of has ever had 20 customers who regularly purchase the equivalent of 20 PV each month consistently. Sure, there might be some rare IBO who does a lot of sales, but given Amway's less than competitive prices, most IBOs likely have sympathetic family and friends as their primary customers, if they have any customers. It's difficult to sell generic types of products for premium prices.

Based on my observations, most IBOs have a small business, unable to sponsor enough downline to move any significant volume. They faithfully self consume 100 PV and do most of the CORE steps, except for being able to consistently show the plan and sponsor downline. Why is this? It is because the Amway reputation is stained and getting people to see the plan is an enormous challenge by itself, not taking into consideration that sponsoring is even harder. If you are reading this blog and you can relate to what you see here, perhaps you need to re-think your business situation and ask your sponsor some tough questions. If your Amway business is not progressing as they show in the plan, when will it ever? Or what will you change if your upline's teaching is not helping you progress? Your upline might say "never quit", but sometimes a wise business decision is to quit and do something else. That's not quitting on your dreams, but simply finding a better venue to achieve them.

Now this leads to another question. Other than flashing a photocopy of someone's diamond bonus or the like, has your sponsor or anyone upline actually showed evidence of a profit in Amway? If you asked, what response did you receive? When I asked my sponsor about profit, I was told it was "none of my business". I believe that someone who is asking you to follow their system, which is not free, should be tasked with providing this information. If your upline teaches submission to upline, even more so you should demand to see results. If your upline refuses to show evidence of a profit, why should you follow their advice?

If your upline or sponsor refuses to show you evidence of profit, it should send up red flags all over the place. Maybe, just maybe, the critics of Amway are onto something.

Better Than Amway?

One of the silly comments I often receive on this blog is that Joecool should offer suggestions about what might be better than Amway since I make comments that are seen as critical against the Amway opportunity. First of all, I would like to make clear that most of my point of contention is against the tools companies and not Amway itself. Having said that, I believe Amway can and should have done more to prevent IBO abuse by upline and tool selling companies. But I believe Amway has not because the uplines are the ones who recruit new IBOs and teach (defacto) 100 PV quotas to new IBOs, thus keeping Amway sales consistent. Uplines also teach product loyalty.

But what can be better than Amway? Well, since most IBOs earn (gross) less than $25 a month, there are many things better than Amway. Working part time for a wage would be more beneficial to most people who get involved in Amway. Buying and selling items for a profit on Ebay is likely to get you more income than selling Amway products. Heck, a lemonade stand on the roadside is likely to get you more income than an Amway business. Even staying home and watching TV is better for most people instead of building Amway because watching TV has no business expenses.

What makes the Amway business financially dangerous to many, is not necessarily Amway and Amway products, but the involvement in Amway training such as voicemail, standing orders, functions and other materials. This training is promoted as the key to Amway success, but as far as I know, there is ZERO unbiased documented evidence that any of this materials work. In my old LOS, Worldwide Dream Builders, or WWDB, the same leaders I saw more than 10 years ago are still there and there are very few new diamonds that I know of. I would guess that there were "some" new diamonds, but there are also many diamonds who are no longer in business. Kind of makes me wonder why diamonds would quit or resign from Amway if they could "walk away" and continue to collect "residual income". Perhaps this residual income is a myth prepetuated by your LOS. Afterall, Amway doesn't mention anything about residual income and I'm certain they would mention it if it were an actual benefit of being an IBO.

What is really discouraging is that so many eager and motivated people get caught up thinking their financial dreams and goals will be achieved by their involvement with the Amway opportunity. Sadly, most will end up losing money because of the very training that was supposed to bring them success! Even the fiercest of Amway defenders have no documented proof of success. It appears that Amway success is elusive even to the most dedicated of IBOs. I have been running this blog (and another blog previously) going back to 2006. Many people have commented and came and gone, some making big claims that they will go diamond and come back to rub my face in it. Not a single IBO has returned with any evidence of achievements from Amway in all these years.

So what's better than the Amway opportunity? Seems just about anything. In fact if you are involved in the training system, donating $100 a month to charity and doing nothing else would make you better off financially than particpating in Amway and the related training. Doing nothing would make you better off. Watching football games would also likely make you better off financially than Amway and the training systems. My recommendation (but you must make your own decision) is to simply find part time work and invest your extra income wisely. It isn't quick or flashy, but you are likely to benefit long term. Of course, your mileage may vary. Good luck on whatever you choose to do.

The Illusion Of Amway Wealth?

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 perspiration.

Anyway, with this part of the year, soon there will be tens of thousands of IBOs shuffling off to a function called family reunion, or in some cases, summer conference. The tickets are about $250 to $300 or so and might require travel plus hotels and rental cars depending on where you live. What IBOs are often unaware of is that many venues will allow you to run these conferences for greatly discounted prices. 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. The speakers will generally be the same old diamonds and/or emeralds. WWDB has very few new diamonds and emeralds so if you've been around for a while, you see the same old speakers function after function.

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 luxuries and just assumed all diamonds had these kinds of lifestyles. It was certainly implied that all diamonds were "free" with fabulous lifestyles. But I now suspect that diamonds live middle class lives although you could try to argue that they don't have to work 9-5.

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 and a fleet of sports cars. As I said, someone may own a mansion and/or 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 any big and hyped function, to watch with a critical eye. What is being implied with the display of wealth? Analyze if those luxuries can be purchased with a diamond income ($150,000 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?

You Can't Buy Yourself To Profitability!

I've been having an ongoing debate with a brainwashed WWDB IBO. He tells me and it's clear that he's convinced that buying from himself is a good business concept. WWDB leaders apparently like this buy from yourself concept because most people do not like to sell things. So it's sounds fairly benign to just buy from yourself and get others to do the same, or to duplicate you. That way, an IBO can still reach their 100 PV defacto quota but not have to become uncomfortable in selling Amway stuff.

But how do you profit by purchasing your own stuff? The Amway IBO says it's easy. He buys wholesale from Amway, and charges himself retail and keeps the difference. Thus he considers it a nice profit. After picking up my jaw from the floor, I asked him why he doesn't just buy 200,000 PV or whatever it is to go platinum or diamond? Of course I'm speaking rhetorically but the Amway IBO doesn't answer and starts calling be a broke loser. Seems when Amway folks run out of material to debate with, the personal insults come out.

So let's take a real life example but for the sake of easy math, I'm going to use round numbers to make it clear and easy. Let's say an IBO has $10. He buys an energy drink from Amway (called XS) for the wholesale price of $2 a cam. He now has a can of XS to drink and $8 change. Still following me? So let's say an Amway IBO buys from Amway wholesale and charges himself retail. He starts with $10 and buys a can of XS for $2. But he charges himself full retail price of $4. So now this IBO has a can of XS and $6, plus a $2 profit which is taxable income. In which case are you better off? Easy, in the first scenario because you have a can of XS and $8. In my second scenario, you also have a can of XS, plus $8. But out of that $8, $2 is taxable.

When you buy from yourself, any "profit" you made, is simply transferring money from one pocket to another. Without any real outside customers, you have in reality, no profits. Thus the buy from yourself theory is ridiculous. Can you imagine any situation where a store relies on its sales force primarily for it's sales? Only in Amway, which is why the vast majority of Amway IBOs make nothing or lose money. Actual stores rely on customers. For Amway, it appears that their customers are the Amway IBOs themselves.

The bottom line is that no store or business can buy themselves to profitability and you are seriously fooling yourself if you think you can.

Your Amway Business Vital Signs?

When you drive a car, you have instruments on your dashboard that let you know how your car is running and possibly whether you need repairs. For example, you have a gas gauge so you know when to refill the gas tank. You may have a oil pressure gauge, tire pressure, and an indicator to show how warm or cool your engine is running. My car has a light that comes on when I need to change the oil or service the engine.

Your Amway business also has some gauges. Unfortunately, many IBOs are taught by upline to ignore these indicators or made to think that warning signs are not to be heeded. I will explain further, but I believe too many IBOs see the signs, but simply have been trained to ignore these vital warning signs.

Selling products. Are you buying more PV than you are selling? I believe most IBOs do. No business can sustain itself without selling to customers. Why IBOs think they can succeed without customers is because of bad upline advice or teaching. Some of the teaching might be to "buy from yourself". When you buy from yourself, you make no profits. Basically, buying from yourself just makes you a customer of Amway.

Non income producing activity. If you spend a lot of time listening to standing orders, reading books, attending meetings and prospecting people, these activities do not produce any income. In fact these activities cost you money. Sure, eventually prospecting may pay off, but are you getting a fair return on your time and money spent doing these activities? If you pay for standing order but are unable to do more than 100 or 200 PV, then your business is not even covering the cost of standing order, not to mention the other costs that your upline may have told you was "needed".

Tools. If your expenditure on tools (cds/meetings/voicemail/website fees) continually exceeds your monthly income, you need to take a look at what it will take in order for your business income to grow. If not, you will simply take a loss month after month. If you are not sponsoring or finding more customers every single month, you are simply running in place and you will expend energy (money) and not get anywhere.

Are you showing the plan? If you are having trouble finding people to see the plan, then you will be unable to sponsor enough people to expand your volume. Also, an inability to show the plan also restricts your ability to recruit potential customers. Do people flinch when you mention Amway? These are signs that should warn you that the opportunity is not palatable to most people, despite what you hear from upline.

The warning signs and gauges are there. IBOs simply need to believe their own eyes.

Walking Away From Amway?

One of the things that many IBOs mistakenly believe is that they will build their Amway business and then they will have the ability to "walk away" from the business while the income continues to flow in. I believe if there was such an incredible benefit such as lifelong residual income that could be achieved from Amway, I'm fairly certain that Amway would advertise this as a benefit of being an IBO. But Amway does not. It is very likely that your LOS such as WWDB or one of the others will promote this benefit while telling you that your bext chance to achieve it is by subscribing to their "system".

One thing that goes unnnoticed all too often is that there seems to be nobody who is actually retired and living off the efforts of having built a big Amway business once upon a time. Seems that even the crown ambassadors still have busy lifestyles running from function to function and participating in other business related activities. While many of these leaders may claim they love their downlines or some other bunk, it is my belief that these leaders keep working their Amway businesses for one reason only. That is they need to keep working in order to keep the income flowing in.

The diamond lifestyle that is often portrayed may seem like a great goal or dream to achieve, but the fact of the matter is that a "diamond lifestyle" cannot be sustained on diamond income. The average diamond, according to Amway, earns about $150,000 a year. While that may seem like a great amount of income, it's not nearly enough to sustain the kind of lifestyle portrayed by diamonds. Even if that income is supplemented by income from the sale of tools, you can't fly your family around the country first class to do all kinds of functions and still end up with much leftover to own fancy homes and cars.

If I deposited $1000 in the bank and never touch the money, the bank would pay me a certain amount of interest each year, guaranteed. That is residual income. In Amway, you can basically earn income in two ways. You can sell products for a profit, but there are problems with this. First off, Amway products in general are more expensive than local retailers. It is why you hear so many justifications about quality and concentration, because you are hard pressed to argue cost. Secondly, you are severely restricted from advertising, thus selling can be difficult. The other way to generate more income is to build a downline in hopes that the downline will help you to leverage your volume. But then your downline will have the same problem that you had in moving products. That being said, even if you achieve some level such as emerald or diamond, your business will immediately begin to fall apart once you stop working because attrition will take its toll. It is why there are hoards of "former" platinums. If platinums are not sustainable, then neither is any other level.

There are many many instances of diamonds quitting, resigning, or falling out of qualification. People come and go in this business every day. Do you really think you can bank on retirement and residual income under these circumstances? If you believe that, I have some swamp land in Florida to sell you.

The Amway Haves and Have Nots?

Anyone who's been prospected or had an experience wih Amway most likely attended a recruitment meeting at a hotel or convention center, or maybe attended a function in a large venue. There might be several hundred to several thousands and if it's a big functions, you may have been sitting with tens of thousands of other Amway hopefuls. My former sponsor told me about a function back in the early 1990's when he attended a function in the (then) Seattle King Dome, which had maybe 40,000 IBOs in attendance. I mean, it must be somewhat exciting to be sitting in a venue with that many people, especially when they all seem fired up about the function. After all, everyone there is going to "go diamond" right?

What unsuspecting prospects and Amway IBOs do not see is that the people on stage are the haves and the people in the audience are the have nots. It's like attending a Bruno Mars concert except that Bruno doesn't lie to the audience that you will someday be with him on the stage making a financial fortune by doing what he does. Very few people are deluded enough to think they will someday be the next Bruno Mars and be on stage in front of thousands of people performing. They pay their entrance fee and enjoy the show. Basically, the same thins is true of an Amway function, except that the diamonds lie and proclaim that "anyone can do it"and that people in the audience will join them on stage.

Sure, once in a while, somebody might break the overwhelming odds and challenges to go diamond, but since I left Amwat and WWDB, more diamonds have left ot died than the number of new diamonds (in North America). Seems the same old diamonds are still there, and apparently teaching the same old tired principles of never quit and dedication to the tool system. And why not? The haves make profits from the tools and the have nots pay for the tools. In a way, Amway is like the real world of haves and have nots, but on Amway and other MLM, the have nots are lied to as if anybody can join the elite and join them on stage at the functions. In case you are an information seeker here, the botto line is that people who sell function tickets make nice profits and people who buy function tickets will make no money, or lose money, most likely because of the expense of tools and function tickets.

In debating a pro Amway/WWDB dude recently, he claims that his expenses are low, which is entirely incongruent with WWDB teaching. He also claims that his upline Diamond can afford to rent a place for $20,000 a month while he remodels his multi million dollar mansion. Is it true? I doubt it, but even if it were true, I doubt that anyone is generating $20k per month selling LOC or vitamins. But selling function tickets or cd or voicemail subscriptions could generate tens of thousands of dollars per month income. For this reason, upline will show you copies of their bonus checks, but will never show anyone their financials. IBOs and prospects who saw that upline rakes in their fortune from tools, might be hesitant to enthusiastically purchase those tools.

Bottom line is if you sell the tools, you are likely successful and are with the "haves". If you buy the tools, you are likely unsuccessful in Amway. You are a have not. The two rarely mingle and you're folling yourself if you think they do.

In My Best Interest?

Amway IBOs, you are called an "Independent Business Owner". This means you are solely responsible for the bottom line of your own business. Apparently, one of the things that commonly happens is that some uplines will take advantage of this by giving advice that is more beneficial to themselves than to their downline. Some of the upline in your group will gain financially from an IBO's movement of product volume as well as tool purchases. So if your upline has a conflict of interest (your interest), do you really think taking advice blindly from them is a good idea? Is it a good idea if your upline diamond hasn't even considered your circumstances involving your business, plus your profits and expenses?

Thus if your upline is advising you to attend a certain function at all costs, or to sell off all your personal goods to buy more standing orders, this kind of advice needs to be taken with a grain of salt and assessed against the performance of your business and the amount of disposable income you have. Also, you may want to consider what you have gotten out of previous functions or standing orders and decide for yourself whether or not expending the cash to attend a function will be cost effective and whether or not you will get a good return for your investment. If the function doesn't directly result in more sales or more downline which results in more profit, is it worth your time and expense to keep attending functions? Same can be said about standing orders and other tools and meetings that upline expects you to attend at a cost.

All too often, it would appear that uplines will encourage their downlines to attend all functions, regardless of whether or not they are profitable, and regardless of whether or not the IBO can afford to attend. In my former LOS, I was a member of World Wide Dream Builders. When I sat in the audience, people were taught how they could put off paying their mortgage or their monthly bills to be able to attend a major function. Or IBOs were encouraged to quit their jobs and find another one if they could not get time off from work to attend. Of course, these same uplines were never held accountable for teaching these bad practices. The result was in a few case, home foreclosures, bankruptcy and massive debt, all incurred with upline's blessing, as long as the debt was in the name of Amway and Amway tools and functions.

IBOs, if you are hearing any kind of advice where tools and functions become a priority over your personal financial or family obligations, I would ask you to sit down and think about whether the said advice is truly in your best interest. If you will fall behind on your bills or mortgage, how will you ever catch up as major functions come up every 3 to 4 months. You will likely face the same or a tougher decision again in a few months. Is your upline's advice truly in your best interest? If so, how so? I urge you to really analyze with an open mind, whether your upline's advice better serves you or him?

Amway IBOs Prey On The Needy?

One of the big things that was taught by my upline was to recruit people who are in need. People in need of time and/or money are perfect candidates is what I was told. You look for a need and use it as a chance to show the plan. Someone who may be looking for more income is likely to be more open minded. It is also why the upper level pins will display signs of wealth as an enticement, to get people interested and hopefully excited in seeing the plan, and hopefully to get people to register for the opportunity. IBOs will wave around a copy of an upline's check.
Recruits will be asked about their dreams. Amway recruiters will then show a "best case scenario" of people with trappings of great wealth. Of course they will not show you what is likely, which is a net loss due to the "system".

At this point, the recruit may start to wonder if he/she might be able to attain the same level of success. The recruit starts to think if he can find "six" as they talk about in the plan. In a 2004 Dateline segment, the show panned in on people in attendance at a function. Some poor saps were in tears. They probably wanted success so badly that they can taste it. They feel that it is definitely within reach. Sort of like how you can see the end of a rainbow but you can never reach it. That's how success is for the vast majority of Amway IBOs. They want suuccess and will work for it, but sadly, it will never materialize.

There are few people on the stage and thousands of people in the audience. That's the way it has always been. Unless the compensation plan changes, that's the way it is likely to be forever and ever. The 6-4-2 plan has 79 IBOs at 100 PV. Considering the people who never do a thing and those who quit, you can assume that you need much more than 78 downline to build a platinum business. And a platinum business is approximately where you start to break even, or possibly make a small net profit, depending on your level of dedication to the teaching system, which drains IBO's resources. That is because of the costs associated with being involved in a system such as BWW, WWDB, or N21.

For most IBOs who decide to try the business and the systems, they will likely end up losing time and money. LOSING TIME AND MONEY. Unfortunately, most IBOs sign up hoping to gain more time and money. Ironically, what they seek is what they have less of due to their involvement with the systems and Amway.

Amway Is Fair?

One of the things my upline always taught was how the business was fair. Everyone starts at zero, we were told. Everyone does start at zero, but it is hardly fair when you break down the compensation and the layers of people between you and your uplines. I will also speak about how the sponsoring is somewhat cloudy as well. Despite the claim that you will be paid if you "do the work", it is not necessarily true. These are catch phrases that upline uses to make it seem fair.

The sponsoring system that Amway uses is a hit or miss. You could have tons of business acumen and insight on running a business, but your sponsor and others upline will always be your upline and will always profit on your efforts - simply because they were there first. In many cases, a sponsor has nothing to offer a downline. They are in no way shape or form able to advise or give sound business advice. But as long as they are in the business, they get to profit from your efforts. Does that sound fair to you?

Also, let's take a new IBO for example. If that new IBO sells and consumes 100 PV, that new IBO will receive a 3% bonus. Amway pays 32% to 33% of their take in bonuses. Thus the new IBO who "did the work" gets 3% and somewhere in the layers of upline, 29% to 30% gets split up among the upline. Some of the upline don't know that the new IBO exists, but they get a portion of the bonus, simply because they were there first. The new IBO has done the work and some of the uplines have done nothing to help this new IBO, but they enjoy a percentage of that IBO's bonus. Does that sound fair?

Tenured upline may also sell business support materials such as voicemail, websites, books, cds, and seminars. None of these materials have been proven to be effective in assisting IBOs in building a business. In fact, some of the biggest crown ambassador types built their Amway businesses before these materials existed. But because they were there first, they now claim to have the expertise on how to build a successful Amway business. Based on some numbers that Amway has provided, we can conclude that less than 1 in 240 IBOs ever reach platinum and out of those who reach platinum, less than 1% ever reach diamond. Not much evidence that the system works. Yes, I acknowledge that some people don't follow the system, but out of these ones who do follow the system, the success rate is still miserably low. If the system is so diffcult to follow and succeed, is it fair for IBOs to have to keep paying for a system that will not help them?

All of the above are reasons a new IBO has the deck stacked unfairly against them. Yes, some IBOs can overcome overwhelming challenges and succeed, but they are few and far between. Is this business set up in a fair manner?

What Are Your Dreams?

One of the things used as a recruitment tool my upline is to get a prospect to think of dreams. Dreams could be extravagant like owning a yacht or it could be simple like taking a cruise ship to Alaska. The recruit is told to dream big and to envision things they would like to enjoy. Perhaps it is not having a job, or perhaps it is being a stay at home mom. These are all great dreams and goals. Dreams and goals are good things to have. The speaker will then tell the audience that these are all possible thru the Amway opportunity. They won't say it is highly unlikely. They only give you the pie in the sky best case scenario.

Now some people may have achieved great success thru Amway. But these people are so few and far between that you could argue that the lottery has the same kind of success or maybe the lottery has more winners than Amway diamonds. Granted the lottery is a game of chance, and Amway is not, but the "likely" results can be comparable. In Amway and the lottery, you have the vast majority accomplishing nothing and losing money. You have some "best case scenarios" where a few are successful. You then focus on and display the success testimonies as evidence that "anyone can succeed", just as anyone with a ticket can win the lottery. The fact that a game of random chance produces similar results as Amway should be a red flag.

Some uplines will often tell their faithful downline that someone who speaks negatively about Amway is a "dream stealer". Of course this is ludicrous. Your dream is in your heart and mind. Nobody can steal that. Secondly, whose dream is being compromised? It is the upline diamond who has all the goodies and the large checks right? The downline are basically ones paying for their upline's dreams. It is fairly well known that the majority of Amway products aren't sold to people who are not IBOs. It is also well known that 99% of tools and business support materials are sold to IBOs. So guess where your upline diamond's success comes from? That's right. An IBO's product volume and an IBO's tool purchases provide the upline diamond with a nice income. Stop and think about it for a moment.

So yes, there are some people who achieve their dreams in Amway. There are also people who achieve their dreams playing the lottery. There are millions of people who tried to build an Amway business and did not achieve. There are millions of people to play the lottery and do not win. Some dreams get built, but chances are they won't be yours. There is a good chance that your upline diamond's dreams will come true if you "never quit" and you stay on the system.

The question is whether you are seeking to build your dreams or someone else's?

Amway Partner Stores

I wanted to write this post because I'm in a debate with an Amway IBO who is bragging about Amway partner stores. The tag line is Amway certainly does their due diligence, as well as partner stores as partner stores would not want to associate with Amway if they were a scam, etc. After reading this post, you will see that "partner" stores would be insane not to partner with Amway. Before going into that, maybe someone can explain what due diligence was put into partnering with Worldcom (formerly MCI) and Enron, for selling energy products and services. Surely all those high priced lawyers must have know about these epic failures (scams)?

Now, when an Amway IBO refers to a partner store, we are talking about a one way road. What I mean is that Amway sells products for these partner stores but the partner stores don't sell any Amway products and have nothing to do with Amway other than a business agreement (apparently) to allow Amway IBOs to act as commission only sales people for these partner stores. Amway IBOs take on all the time and personal expenses of moving partner store products, often at non competitive prices, and get a small commission only if they meet a minimum quota (100 pv), which is roughly $300 USD.

Imagine that, a partner store basically has the entire Amway sales force potentially selling their products and the partner store can charge whatever they want. The Amway IBOs are often taught to buy from Amway and the catalogs so the entire sales force often becomes loyal customers as well. And to make the deal even sweeter, the partner stores pay nothing unless the Amway IBO sells at least $300 worth of products, although partner store and Amway products can be commingled. In my way of thinking, it's a no brainer for partner stores to hook up with Amway. They have no risk and potentially a lot of addition sales. High upside and no downside.

And the cherry on the sundae for Amway and the partner stores is that Amway IBOs will also recruit and train other Amway and partner store commission only sales people at their own time and expense. Amway and partner stores can't possibly lose!! I almost want to go an create Joecool's widgets and become an Amway partner store myself. If Amway people sell my $100 Joecool widgets that cost me $5 to make, I rake in huge profits and the most commission I would pay is about 25%. It's a great deal because Joecool has zero risk. I only pay if the product gets sold. and I don't pay if products don't move. I might even be able to sell Amway IBOs my catalog so they can sell my stuff. It's heads I win and tales they lose for me.

So if you ever hear about and Amway IBO bragging about how Amway partner stores like Nike, Barnes and Noble or whatever big name company might "partner" with Amway, you can laugh to yourself and to use Amway's own catch phrase: "Now you know".

Your Chances In Amway?

Many people consider the platinum level in Amway as a significant achievement in Amway. While it may be nice to achieve that level and gain recognition from the Amway corporation, I will point out that there was a study done in Wisconsin where the attorney general analyzed and found that the top 1% of Amway IBOs lost money. The study is somewhat dated, but I will also point out that today, there are MORE expenses associated with running an Amway business than before. (Voicemail, books, functions, standing orders, shipping). I would guess that it's possible and even very likely that platinums lose more today than when the Wisconsin study was done.

A typical platinum group often has 100 or more downline IBOs. Thus a logical conclusion is that less than 1% of IBOs can reach that level. It is also, apparently rare to maintain that level. Factoring in people who quit, one can conclude that only a fraction of 1% ever reach platinum. My former upline diamond had 7 frontline platinums in his heyday. Actually, 6 of them were ruby level. None of them hold the platinum level today. So you have a less than 1% chance of reaching platinum and then you are unlikely to be able to maintain that level.

What serious prospective business owner would even consider opening a business where you have such a tiny chance of success? Even those who achieve platinum are likely to lose that level. If platinums cannot maintain their level, then it's easy to see why there are former diamonds as well. It seems that people are willing to take a chance on an Amway business because the start up cost is low. But what is the point of doing all of that when the chance of making money is negligible?

To compound the problem, many IBOs spend a lot of time and money building an Amway business that is unlikely to give them any return on their investment. I'd guess that the average serious IBO would spend $250 a month or more on tools. That money invested over a number of years in mutual funds would give you a much better chance of achieving some dreams. Even putting the money in the bank would make you better off than the vast majority of IBOs. A serious business owner would want to know their realistic chance of making money. For some strange reason, prospects and IBOs seem to ignore this reality. They dream of only the best case scenario or what is possible. They seem to ignore what is likely.

It is because uplines are in the business of selling tools and distributorships. They are not truly interested in your long term sustainable success. If you don't believe me, try to stop purchasing standing orders and function tickets and see how much longer you are edified and given help from upline. Seriously, would a real business owner be interested in a less than 1% chance of success?

Tools Are Vital To Amway Success?

As an IBO, I was told that I "needed" to attend all functions. Attending all functions meant "all" is what I was told. Brad Duncan once had a tape in the true north series where he said that downline should not cancel standing orders even when IBOs quit, because there would then be an urgency to replace that person. I was in WWDB and while not everyone in WWDB may have taught this, our group was told that we should purchase 5-7additional tapes/cds in addition to standing order because we needed to listen to new material daily and because we should be passing out these materials as they will sponsor new people. To date, I do not know of anyone who passed out a tape or cd and had someone decide to join the Amway business as a result of listening to that tape or cd.

When I was in the business (In WWDB), our group was told that WWDB was a non profit organization. That was quickly retracted, but still, the WWDB leaders stood on stage in front of tens of thousands of IBOs and said nobody made a profit from tools. We now know that it was a lie. We also know that many of these leaders are still teaching, and as far as I know, not a single WWDB leader has ever been accountable for these lies. Some of these lies may have caused untold financial damage to downline. I'm certain I would have been less dedicated to tools if I had known that some uplines made most of their income from tools and that their advice was a conflict of interest. Some Amway defenders are currently talking about how some negative misinformation about Amway is hurting their business, but ironically, it would appear that most damage to Amway has been done by IBOs themselves, such as tricking people to meetings. As far as I know, not a single person has ever been held liable for the financial damages to downlines and former IBOs who lost money by being told lies about Amway.

Now I also would like to emphasize that I do not believe the tools work and do not produce any results. While Amway defenders will claim that most if not all new emeralds and diamonds are on the system, they fail to mention that there are also tens or hundreds of thousands of people who work the system without results. As far as I know, there is no bonafide unbiased evidence that suggests that the system produces any results. It is why IBOs end up later talking about being a nicer person of how their marriage was strenghthened by joining the system. While these are nice side benefits (if true), these reasons are not why you started a business. A business exists to make a profit, yet uplines make all kinds of excuses as to why IBOs did not profit, even placing the blame on the IBOs who trusted them.

It brings me to the real purpose of having tools. The REAL purpose of tools is to make profits for your upline. I believe the tools were invented as a way to motivate and train new and distance IBOs, but apparently, GREED eventually set in and many uplines started emphasizing tools, not because they wanted downline success, but because their tool businesses were wildly successful with thousands of captive downline dedicated to the system. I believe it is why I saw many IBOs who worked hard, never missed a meeting or function, did nto sponsor any downline, but were still told they needed more and more tools.

I believe the real purpose of having tools is so your upline's tools business can be profitable.

Building The Business?

Building an Amway business. That's what many IBOs set out to do, except they don't know how to build a business, and based on IBO behavior and the things they say and do, it makes me wonder what their upline actually knows about building a business. A typical business owner will get started, and needs people to know that their business is there. You build a business by building a customer base, except that many Amway IBOs wind up buying from themselves instead of selling to actual customers.

When you open a store or a restaurant, you may not make a lot of money intitially because not enough customers know about your store and you have not yet built a reputation. New customers who have a good experience are likely to return for more, and they are also likely to tell others about your store. Over time, you create a customer base and your weekly sales become consistent and somewhat predictable. Conversely, if customers have a bad experience, they are likely to tell others as well.

In the Amway business, many IBOs have no idea about building a business. They are shown great (apparent) wealth by upline, and then told that their business activity consists of showing the plan, listening to standing orders and attending functions. Most of an IBO's activity, as prescribed by upline, costs money instead of generating sales. Some uplines do teach IBOs to sell items, but more often than not, it is not taught as a priority but as a side thought.

What's more, as I said, a new business will get repeat customers when a customer has a good experience. What do you suppose happens when IBOs lie or trick people into attending Amway meetings, or deceive people about their business, or make up wild stories about perfect water? What happens when you embellish the truth about success and then cannot provide an answer when a recruit asks and IBO how they are doing in the Amway business? What happens when an IBO tells a potential recruit that he or she is a loser or stupid for not joining Amway? Would you return to a store if they called you stupid as you were leaving? What if you were called a loser?

These are the reasons why IBOs in general cannot get enough customers to sustain a consistent and predictable amount of sales, and why over the years, Amway has at best a spotty reputation. Just the mention of the name Amway and you may get funny looks from people. It is why certain internet zealots promoting Amway do more harm than good.

Glorified Sales People?

When I saw the Amway plan, it made perfect sense at the time, because the diamond who made the presentation made everything seem sensible. Make money and/or save money. On the surface, you would have to be nuts to not want to make or save some money. But it is the reality that is the problem. The reality is for business building IBOs is financial damage or financial disaster from the ongoing costs of the system expenses. I saw crosslines go bankrupt and more than one couple lost their homes to foreclosure by "doing whatever it takes" to get to the next function.

Our group (WWDB) edified people who bought extraordinary amounts of extra tapes/cds, extra function tickets and made superhuman efforts to get to functions. Looking back, I remember an IBO who was edified for coming all the way to a family reunion function in Portland Oregon when he was diagnosed with terminal cancer. The speaker said he could have been miserable spending time at home but here he was making a difference in people's lives. WTH? I wrote a post earlier this month about how IBOs think they are saving the world and helping people when in reality, the masses of IBOs are only "helping" their diamonds to attain material wealth by purchasing function tickets, voicemail, standing orders and other materials.

I would agree that some training and information can be helpful for new IBOs but I do not see any value in a never ending supply of cds or downloads and and an endless number of meetings and functions. The very thing (support materials) that uplines claim is your key to success is the very thing that nearly guarantees business building IBOs to financial struggles. Our upline wanted IBOs to be out of debt, which is good, but they would also say in the same breath that it was okay to go into hock if it was to attend functions or to purchase additional support materials. WTH? Sadly, many IBOs do not see through this self serving advice.

Most people, including myself are very wary when we deal with car salesmen. We are wary because we know that the salesman is out to make money off of us and will try to sell us every option in the book. Thus we negotiate and reject the car options that we don't really need to have. Guess what? Your uplines are like car salesmen except that they sell you different options such as premier club, standing order, book of the month, function tickets, voicemail, open meeting tickets. Just like a car buying customer, taking all the options maximizes the car salesman's commission and the car dealer's profit. Buying all the support materials increases your upline's profits. Imagine the car salesman telling you that the extended warranty was vital to owning the car. You'd think twice about it, yet uplines will tell you that functions are vital to your Amway business and many IBOs buy it hook line and sinker. I hope this analogy will encourage IBOs to think of support materials as options on the car. You don't need any options to make the car work. Just as you don't really need support materials to buy and sell Amway products, and to get some downline to do the same.

We are wary of car salesmen. In my opinion, downline and prospects should be just as wary of uplines who promote tools as "vital" to your success in Amway. Keep in mind that a sponsor is obligated to help train any downline, regardless of whether they are on the system or not.

The Business Mentality

One of the things Amway IBOs "think" they possess, but in reality they are far from it, is "Business Mentality". It is not necessarily the fault of the IBOs. Many are sponsored into Amway by trusted friends or family lacking business experience. They will "submit" to upline as they are advised and will try to learn about the Amway business. The problem is that many upline leaders teach self serving business practices such as hard core dedication to their tools system, from which they often handsomely profit. They may also downplay the vital importance of actually selling products to actual customers. Let's examine some of the questionable practices.

"Buy from yourself". If you have a business owner mentality, you only buy from yourself if it's beneficial to your business. Many IBOs talk about ridiculous things like a McDonald's owner would never eat at Burger King. That's totally false. Just because I own a McDonald's doesn't mean I am eating Big Macs the rest of my life. You cannot spend yourself to prosperity. If I sold pens for $1.00 and my cost was .50, and my competitor had a special on the same pens at 3 for $1.00, I'm buying them from my competition. Also, buying from yourself makes you a customer, not a business owner. Many new IBOs and prospects fail to see the flaws in this kind of teaching. If you buy from yourself, anything you make comes out of your own pocket. That's not even a profit if you transfer money from your left pocket to your right pocket.

"Ignore facts if you have a dream". This is probably the biggest heap of bull crap taught by some upline. I have seen this spouted in particular by IBOs downline from WWDB and BWW leaders. A business owner studies the facts, not ignores them. Any REAL business owner wants to know how much he is bringing in and how much is going out. That's how you detect the heartbeat of your business. A site visitor named Gina on this site, posted a profit/loss statement from her real business. Naturally, IBOs were at a loss to discuss it because it was foreign material to them. If you are spending more on tools, functions and training than you are taking in, you are operating at a net loss and unless your sales goes up, you will continue to bleed money until you lower your expenditures. The purpose of the training is supposed to help you generate more sales volume. If that isn't happening, how much more training do you really need?

"Submit to upline". Another load of hogwash. Why should someone submit to upline simply because they "sponsored me" or whatever? Why should someone have authority over you and your business simply because they signed up before you? A real business owner would think independently and make business decisions based on facts and numbers, not on the advice of someone upline who hasn't taken the time to assess each IBO on a personal level to be able to give advice on an IBO's "Independent Business", or worse, advice on their personal lives".

"Dedication to the system". Silly advice as well. What dedication does the system have for an IBO? If an IBO succeeds (which is very rare), the system takes credit, but for the more than 99% of people who never make a significant income, it is their own fault if they don't make it. Amway apologists will defend this by saying that many may not have signed up wanting a significant income. While that may be partially true, tell me where people show "plans" designed for the guy who wants an extra $100 a month? The plans shown are always (AFAIK) to go platinum or diamond. There is no unbiased evidence that the systems help anyone succeed in Amway.

IBOs and information seekers, does any of this sound familiar? Is this a part of your experience? If so, I encourage you to ask questions and get more information before proceeding with any more "business" activity.

Not Working Hard Enough?

One of the things Amway IBOs are taught is to blame themselves for is not working the business hard enough or not doing things right, exactly as upline advised. Actually, nothing could be further from the truth. It's just that uplines want to be absolved from any responsibility so they teach downline that failure in Amway is their own (The downline's) fault. Upline is also quick to take credit for any success, of course. Why shouldn't these same leaders be held accountable for their downline's results? And I would argue that the numbers of failures (the vast majority) would suggest that upline advice is suspect at best and terribly ineffective at worst. To compound the problem, uplines can make significant money from the sale of tools and functions so they should be taken to task for the results. However, most IBOs just quit and then fade away, often blaming themselves for failure.

The reason why hard work doesn't equal success is because an Amway IBO is basically a commissioned sales person. In commissioned sales, one can work hard for no reward and at times, little effort may reap large rewards. But in Amway, with a bad reputation, Amway IBOs are dealt a handicap that most simply cannot overcome. Getting new people to recruitment meetings is hard enough, not even factoring in the ability to sponsor others. Then you toss in the high and non-competitive prices of products and when factoring in these tidbits, it's easy to see why uplines teach buy from yourself and selling is not needed or emphasized in a serious manner. Selling products average in quality and premium in price is not an easy task. For that reason, it's easy to see why Amway is a difficult business to navigate.

The work involved is very simple. Sell products and get other IBOs in your downline to be able to leverage your volume. Many IBOs work hard and attend all of the functions and do all of the steps as outlined by upline, but very few reap rewards and most quit when they realize that the system just doesn't work. It is sad that on top of losing money, that IBOs are also taught to blame themselves for their demise. Where is the upline when IBOs bust their butts working hard and get no rewards? On top of that, to make it worse, uplines profit from selling training and motivation to their downlines. Why aren't they held accountable?

I've read comments by some Amway defenders wanting to sue Amway critics for a potential loss of business. What loss of business? Most IBOs do nothing and quit to begin with. Most critics, like myself are simply stating our experiences and opinions. Many of which are true and still happening today. So I will ask, what about the millions of former IBOs who may have lost billions of dollars because of false claims which led them to believe that they would get rich following upline advice? Maybe former IBOs should unite and file claims against unethical upline leaders who led them astray? Why not hold these leaders accountable?

In any case, hard work doesn't equate success in Amway and I dare anyone to try to prove me wrong.

What Is Real Success?

Success is subjective. Someone making ten dollars might be considered successful, for others, nothing less than a barrel of cash will suffice. One other important point is that there are undoubtably some very successful people in Amway. I am sure that some Amway diamonds are quite well off and enjoy some of the finer things in life. But the reality is that these successes are very very rare and many of these success apparently are not sustainable as many people are led to believe.

But the bigger issue in the Amway opportunity is where the success comes from. Sure, many people want to "go diamond" and live in luxury while barrels of cash roll in. But what is unknown to many, is that the few who enjoy the lifestyle and trappings do so at the expense of their downline. The downline move the volume and the downline purchases the system materials, both of which is profitable for the upline. Because Amway products, admittedly are not commonly sold to people who are not IBOs, then anyone can conclude that upline success comes from the pockets of the downline. Most downline would be better off writing a check for $100 each month to their upline and not participating in the business or buying products at all.

This in itself would not be such an issue if the system actually churned out new successes frequently AND if the downline were not led to believe that the system is the key to their success. But less than one half of one percent of IBOs ever reach platinum and out of those who do, only a tiny fraction of one percent ever attain the diamond level. But the business has tens of millions of people who tried and could never achieve what was promoted. Lack of effort may be a factor, but when that many people try and fail, it's evident that the system is flawed as well.

To summarize, it is possible for someone to achieve a level of success in Amway, but it is so difficult and so rare that IBOs probably have a better chance of winning the lottery or being struck by lightning than they do of achieving a significant level in the Amway business. Some people are successful, but it is usually at the expense of their downline. The catch is that uplines will teach their faithful downline IBOs that attending a function or buying a standing order is success, regardless of whether an IBO is earning a profit. So many IBOs think they're successful but they are simply fooling themselves with the help of their upline.

Success is undeniable, but sadly for the vast majority of IBOs, it is also unattainable, at least in the Amway opportunity.