Personal Responsibility?

One of the disturbing things I have noticed about Amway IBOs and IBO leaders is how they will advise 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.

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 what about the hoards of people who put forth a serious effort only to fall short?

I have found, during my blogging experiences, 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 promised, or in some cases, guaranteed. My former sponsor was still active, last I heard and has been in Amway for over 15 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, or big losses if you are dedicated and sold out to the system. Factor in the time spent by husband and wife and these folks are breaking even or losing money, or making a fraction of minimum wage. Is this the dream that will allow you to buy mansions with a cash payment?

What is also disturbing is how upline 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 minimal success, there are hundreds if not 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 lottery.

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

The Sunken Cost Fallacy?

One thing that many Amway IBOs likely suffer from is having invested too much into the business to quit. They may have spent months or even years working the system hard and they start to realize that the system isn't working out or that the business is just not producing the results that were advertised. You see obvious problems in the business, but you reach a very tough fork in the road.

To quit would mean failure, as presented by many uplines. To quit is to be broke for life. To give up hope. Quitters are failures and are labeled as losers by the Amway IBOs. What hopes do you have of retirement and walking the beaches once you quit? Are your dreams of success shattered? This is a very difficult decision that must be dealt with by Amway IBOs, or maybe even those considering the business. Often the "sunken cost fallacy" plays a role, where you feel that you've invested too much to just walk away. although in many cases, making a business decision to stop is the only way to stop the financial losses.

I encourage IBOs and/or prospects to completely take the emotion out of this decision. Do not think about dreams, walking the beaches and early retirement. Do not think about what you upline may or may not have promised you. Stop and think only about your Amway business and the results that it has produced or not produced. Has your business been increasing towards your goal of financial independence or are you seeing losses month after month? Do the math. Are you on target to reach your financial goals or are you headed towards bankruptcy? Don't think only about what happens if you quit. Think about what happens if you continue. Are there prospects of making a profit or is that next major function around the corner and likely to put you deeper in the hole?

This post is not about encouraging people to quit or to walk from the business. But certainly, business owners should think like business owners and they should make an honest and realistic assessment about their continued participation, especially if their bottom line is red ink. If you are not making a profit now, what will change next month to make things better? If you repeat what your upline advised. your results are not going to magically get better. Use facts to make an informed decision.

Amway And Motivation?

I believe that Amway IBOs have approximately a 50% attrition rate for the first year alone. If you look at a 5 year window, I believe the attrition rate is something like 95%. So what we're saying is that out of 100 IBOs, only 5 will be around in 5 years, or out of 1000 IBOs, 50 will remain after 5 years. This is extremely significant because if you are a business builder, you will need to replace half of your IBOs every single year. For this reason, I am very doubtful that there are IBOs who "built the business right and built it once", who no longer do Amway related work, but still collect significant residual income. I would guess that significant income could be defined as being enough to live a lifestyle in the top tax bracket (for the US) without having to report to a J-O-B.

Now I understand that some IBOs take it personally when I bring up subjects like this. It is because they have been deceived by some upline diamond or big pin who has sold them on a dream of financial prosperity for life if they will only work hard for 2-5 years. I once thought so too, but realized that there isn't a single diamond that I know of who built the business right and walked away to enjoy the beaches of the world while truckloads of money rolls in. Kinda makes you wonder why you see Crowns still working, and diamonds actually quitting or resigning. I have asked the question many times and it has never been answered. Can anyone name a few people who built their business right and built it once who is currently enjoying these lifelong residuals? Also, if that were a benefit, why doesn't Amway say so?

Instead, you have a constant and endless flow of motivation being sold to IBOs. This motivation comes in the form of cds, books, meetings, functions and other things like voicemail messages. It's sad that IBOs have to continue to pay through the nose for motivation and "teaching" about the Amway business when there are cheaper and more efficient means of communication. For example, why would you need an expensive voicemail when a facebook group account can disseminate messages to your group in seconds at no cost? It is because the uplines want to extract every possible sent from their downline. Because of the internet, I believe people are starting to figure things out and avoid the systems altogether. I hope Joecool's blog contributes to this.

All the motivation IBOs truly need is to see a net profit at the end of the month. If IBOs actually earned an extra $200 a month, or $50 a month, or $600 a month as advertised, there would be no need for motivational speeches. The IBOs would simply look at the growth in their finances and they would keep going. The poor retention rate is easy to explain. IBOs are losing money because of the system expenses and they lose their motivation to continue. If you are an IBO or a prospect, stop and think for a minute. If you are making an extra $200 a month with minimal effort, would you need functions and other materials to motivate you? Or would you have intrinsic motivation from the profit? All the motivation you will ever need is a net profit. Take that to the bank.

Upline Mentors Or Charlatans?

The really insidious part about some of the LOS leaders, such as the ones I had in WWDB, is that they apparently are cutthroat ruthless businessmen with nice suits, and disguised as your mentors and friends. They get you to trust them, and they will tell you that they have your best interest at heart, or that they would never purposely lead you astray. On the surface, you may think this is true, but look at their actions and you can easily discern that some of these uplines are absolutely ruthless businessmen who would take every cent from you if they could. I was in WWDB and I have good reasons to believe that they are still doing this, based on a WWDB IBO blog. On this blog, I see all the same teachings today, that I heard as an IBO and some of the same claims such as buying homes in cash. It's scary.

As an IBO, the diamonds would tell you to never miss a function, ever. The only good reason for missing a function was for your own funeral. I recall some cross line IBOs rearranging pre-planned anniversary parties, weddings, and other special family events in the name of being core and attending all functions. Some IBOs actually did quit their jobs to attend functions and they very well may have done so because some uplines taught this. IBOs were also encouraged and told to go into debt to attend a function. This was okay because it was an investment into your business.

Our group was also strongly encouraged to buy extra cds every week. To be core, you needed to listen to a cd each day and you cannot listen to the same one each day right? Couples were told to buy their own separate standing orders. Brad Duncan even had a true north tape (cd) that said sponsors were to eat the standing orders for downlines who quit because it was too much trouble to call upline who calls upline who calls upline to cancel a standing order. Oddly enough, they didn't mind upline calling upline calling upline to add a standing order.

In the end, I was lucky enough to have been progressing up the pin ranks so my losses were not that devastating. I ended up losing in my early months of the business but mostly broke even when I was at 4000 PV. Sadly though, my cross line did not fare so well. I know of one couple who declared bankruptcy. I don't know how much their WWDB involvement contributed to bankruptcy, but I am certain it was a major factor and I know of two couples who had homes foreclosed, and I believe that their allegiance to WWDB was a factor in those foreclosures. But I guess hey, two WWDB diamonds had homes foreclosed so maybe they were duplicating?

Do not be fooled. The diamonds may have a nice smile and a nice suit, but they are ruthless businessmen who will take your last dime if you allow them to.

Trading Your Time For Dollars?

One of the ways that upline diamonds would put down jobs was to toss in the phrase that a job was simply trading hours for dollars. As if it were demeaning to have a job where you got paid for your time. I believe it's all relative. Being that many IBos are young and maybe working in more entry level types of jobs, then yeah, your hours wage might not be that great. If you earn say $10 an hour, then you might be struggling financially and it may take time before your skills and knowledge increase to a point where your experience is worth more money. What if you had a job paying $1000 an hour and earned $160,000 a month? Is that a lousy deal trading hours for dollars? I think your perspective would change if that were the case.

Conversely, having a business can be good or bad also. If you have an Amway business earning less than $100 a month and you spend $200 on functions, standing orders and other training and motivational materials, then you are losing money. You would be better off working for free. That is still a better alternative than working a business where you are losing money. I think most people agree that a platinum group typically has a 100 or more IBOs. Thus a platinum is in the top 1% of all IBOs. I have heard that the platinum level is where you start to break even or make a little profit, depending on your level of tool consumption. If platinums are barely making a profit, then the other 99+% of IBOs are likely losing money. How much is that worth per hour?

I think uplines cleverly trick IBOs into thinking that a job is bad. Trading hours for dollars, after all, sounds like some kind of indentured servant of sorts. But in the end, what matters is your bottom line. If you are an IBO with little or no downline, and/or not much in terms of sales to non IBOs/customers, then you are losing money each and every month if you are attending functions and buying standing orders. Your 10-12 hours a week of Amway work is costing you money! But if you spend 10-12 hours a week, even at minimum wage, then you might be making about 300 to 350 a month gross income. After taxes, you make about 250 to 300. At least trading hours for dollars gets you a guaranteed net gain at the end of the month.

Uplines trick you into a "business mentality" where you think that working for a net loss is just a part of business. IBOs should realize that a business promoted as low risk and no overhead should be one where you can profit right away. Instead, IBOs are taught to delay gratification, or to reinvest any profit back into their business in the form of tools and functions, which results in a net loss. If that's the case I would choose trading hours for dollars.

Remember, trading hours for dollars is not a bad deal if you are making enough dollars per hour. And even those who make less, are better off that those who "run a business" but end up with a net loss. It's all relative and hopefully, this message will help new or prospective IBOs who are being enticed to join the Amway business opportunity. Good luck to those with jobs and those with businesses. You can be successful either way. Remember that!

Making Money In Amway?

One of the secrets that most IBOs don't figure out about Amway is how the money is made. This is because your upline probably hasn't been forthcoming about their secrets. Tens or maybe close to a hundred million people over the years have seen the Amway plan either at a coffee shop, someone's living room, or maybe in a convention center or hotel ballroom. In my day, Amway was promoted as a way to make money and save money. I doubt that this has changed very much over the years and things I still see online seem to confirm my belief.

But let's get real. Do you really think you can get rich selling basically vitamins and household products person to person and to your family and friends? I would venture a guess that many people struggle to meet the 100 PV minimum defacto quota. And that 100 PV bracket is likely to get you a whopping $10 bonus. Apologists will claim that it's $10 more than you get from Walmart or Costco. Let's examine that. If I spend $300 at Walmart or Costco, my cashback credit card gives me about $3.00. Not a lot, but still I am "paid" to shop. Next, I can get 36 rolls of Kirkland toilet paper for $11.99. If you buy Meadow Brook toilet paper, I am already ahead of you in overall savings and that doesn't include the savings from other common or similar products. Never mind the time you spend finding customers and downline, plus the expenses associated with running a business. Obviously you won't likely make a lot of money selling Amway products person to person, which is why new Amway IBOs are trying desperately to sponsor downline, which helps to leverage your volume.

So how do these diamonds earn what appears to be a sizable income? The answer is simple. They sell voicemail, premiere club memberships, standing orders and audios, books, seminars and open meeting tickets and other materials. While a rare individual may actually move up the ranks to become an emerald or diamond once in a while, the rest of the rank and file IBOs end up with a net loss directly attributable to the purchase of these tools. Selling tools to a group of thousands can be a huge source of income and might be able to sustain the sports cars and other luxuries that are shown off. The tools have a larger profit margin than Amway products, and unlike Amway products, the rank and file IBOs do not receive any cash bonus or rebate from the sale of tools.

The very sad, and often unseen reality though, is that the system doesn't work. It never did apparently work and there is no documented unbiased evidence that the system does anything to help Amway business owners to succeed and thrive. If it did, there should be new diamonds emerging every month. In North America, there were maybe a handful of new diamonds in the last ten years or so, give or take a few. But no steady progression of success. Instead, the same old tired diamonds are still on stage selling their wares (tools), with little notable success growing beneath them. Every so often a new diamond will emerge, but overall, the system is just ineffective at churning out success.

Can someone make money in Amway? The answer is yes. But the truth is that you can earn much much more selling tools. Amway defenders like to say "anyone" can succeed in Amway. To that I say "anyone" can win the power ball lottery. While Amway is not a game of chance, there have been more power ball lottery winners in the US than new diamonds in Amway. And power ball lottery winners did far less work, and probably spent less money than someone seriously trying to build an Amway business.
:-)

Are Amway Diamonds Fake?

One of the things I distinctly remember being taught at a function was to "fake it till you make it". This was to give the impression of being successful. It was said that you are going to be successful because of Amway so you may as well act the part. I believe this is taught today as well. Amway IBOs like to make an impression on prospects so the want to appear successful. It is also a part of why IBOs wear suits. They want everyone to be under the impression that they are in a multi million dollar business. Guess what? WalMart is a multi billion dollar business but their employees don't wear suits!

What I find really interesting about this is that I honestly believe the biggest fakers are probably the diamonds. In the past several months, all over the country, there were functions called "Dream Night". A function with a sit down dinner where the diamonds and other Amway heroes show off slide shows of mansions, jets sports cars, golf club memberships, fabulous vacations, and shopping sprees. I honestly believe that many of the diamonds are the biggest fakers out there. A diamond income, which seems big, and supplemented with tools income, most likely cannot sustain the lifestyles portrayed in these functions. Simple math bears it out.

A diamond income (non Q12), even with tool income might be $250 or $300K. While that may seem huge compared to a working stiff who earns %40K or $50K per year, keep in mind that a diamond business has many expenses. How much do you think it would cost a (diamond) family of four (4) to travel to say 5 or 6 functions, first class? Four people flying first class say from Hawaii to California would cost over $1000 per person, round trip. A diamond who speaks at functions would make several of these flights each year. Thus this particular business expense (if the diamond flies first class) would eat up a significant portion of a diamond's income. Keep in mind that the $250 or $300K I spoke about is before taxes and business expenses.

Then, much of that diamond income goes to taxes and business expenses? I challenge IBOs to sit down and figure this out. After taxes, medical insurance and business expenses are taken into consideration, I would guess that a diamond lives a very ordinary and middle class lifestyle. Amway advocates will argue that this is without a 9-5 job, but an Amway business needs constant attention as IBOs up and quit every day. Some who do sign up never do a thing. Replacing IBOs is a never ending task. It is why you do not see or hear of any diamonds who "walked away" to collect residual income forever and ever.

Here's another take on fake it till you make it. Isn't this simply lying and hoping you will one day succeed?

Why Amway IBOs Fail?

Over the years, there must have been tens of millions of IBOs who had some experience with Amway. Obviously, not all of these folks got involved in a system or had the intention of trying to make millions of dollars. But looking at the business as a whole, the number of people who make a significant income from Amway is a tiny fraction of 1%. If a typical platinum has about 100 IBOs in a group, then you can conclude that platinum is in the top 1% of all IBOs. And we know that many IBOs quit and go through the business each year. The attrition rate can be staggering for bigger pins who need to keep working to replace those who quit.

But the question that seems to be ignored is why so many IBOs end up failing? Now for the sake of this discussion, let's exclude IBOs who do nothing and quit. Let's talk about IBOs who make an earnest effort. Often, the serious IBOs will be on the system consisting of voicemail, standing order, functions, books and other meetings. These all come at a cost, therefore, IBOs need to make several hundred dollars a month or more just to break even. I might add that a rank and file IBO who earns about $200 a month from Amway is way above average and the vast majority make far less than $200. Amway reports that the average income of active IBOs is about $200 a month but that includes the diamonds and other big pins. Therefore, the average business building IBO is operating at a loss.

Let's look at some of the reasons why IBOs cannot succeed. In general, Amway product pricing is higher than local big box retailers. Amway pays bonuses, therefore the bonus payout is included in the price of the products. I suppose a platinum gets a good deal, being at the 25% level, but a platinum is in the top 1% of IBOs. The majority of the rest receive a paltry 3% which leaves them at a loss when business expenses are factored in.

Past IBO abuse and past IBO behavior makes it nearly impossible, at least in North America, to find potential downline IBOs and customers. Seems everyone knows of someone who was tricked into an Amway meeting or was deceived about Amway in some manner. I believe Amway has seen a decline in sales in North America, with foreign countries being responsible for any current growth in business.

Another factor is that IBOs are taught by uplines to engage in too many activities that do not produce income. Attending meetings, listening to cds/audios, reading books and other functions cost the IBO money. They do not result in more sales to customers. These non income producing activities seem to be the majority of an IBO's activities, thus it's easy to see why so many IBOs fail. While system leaders claim that their system works, there is no reasonable evidence to support this claim. Just the fact that new diamonds and emeralds are so rare these days suggest that the system, with their severely limited success is producing less success these days.

All told, an IBO's chance of succeeding in earning long term sustainable income is so tiny that IBOs seriously would be better off buying lottery tickets instead of buying tools such as standing orders and function tickets. At least buying lottery tickets would not use up 10-15 hours per week of your time, and your chance of winning is about the same. The system doesn't work, it is why most IBOs fail.

How To Defend Amway?

I've been blogging for many years now and one of the conclusions I have made is that there really is no defense for debating the merits of an Amway business when the IBO is participating in a system such as WWDB or Network 21. I have no issues with IBOs who sign up and sell actual products to non IBO customers, but these sales oriented IBOs are very rare. Most IBOs who are entrenched in a system are often focused on sponsoring downline because that is the only way an IBO can achieve certain levels such as emerald or diamond. The emerald or diamond level is the goal of many because it is allegedly the level where an IBO can "walk away" and enjoy barrels of cash rolling in for the rest of their lives. I find it ironic that even crown ambassadors keep busy schedules and have not walked away into a quiet life of retirement and uncountable amounts of money. Instead we read about these crowns passing away while still on the (Amway) job.

In general, it would take about 100 IBOs or so to make up a platinum level business. That's 1% at best and even less when you factor in IBOs who do nothing or IBOs who start and quit. In my estimation, a very dedicated hard core IBO would only begin to break even or make a little bit of income at the 4000 PV or platinum level. Of course, your business structure would be a factor in determining how much you can earn. Sponsoring width gives you more profit and sponsoring depth allegedly gives you some stability. Thus you could reasonably argue that about a fraction of 1% of IBOs break even or make a little bit of income. What real businessman would even consider opening a business where your chance of making a profit is less than 1%? Yes, you can argue that Amway is a business and not a game of chance, but a prudent decision also factors in your realistic chances of success.

Other factors that would make Amway unattractive is that the products are priced higher (in general) than comparable or the same products that are available at people's local retailers. Yes, Amway folks will argue quality and concentration factors but those arguments are simply justification for the higher prices. The vast majority of people are satisfied getting cheaper prices at Walmart. And seriously, WalMart products aren't of a lesser quality than most products you get from Amway in the first place. Also, IBOs are restricted from advertising their goods, thus are relegated to person to person advertising, which is probably the least effective method of getting the word out to the masses. Higher prices and unfamiliar products results in what many groups have - IBOs who "buy from themselves" in order to earn their bonuses. Also, any bonus that is earned by most IBOs is just a partial refund on having overpaid for a product. Not to mention unless you are at a higher level in the business, your upline(s) get most of the bonus, whether they helped you or not.

Yes, it is possible for some people to make some money in Amway. Yes, some people do make some good money from Amway. It is not possible for all IBOs to make money unless they are selling products to non IBOs and we know that most IBOs don't sell anything or sell just a few items to others. We also know that the tools systems generally eat away any small bonuses IBOs earn and leave them with a net loss. For the truly dedicated IBOs, the losses can mount into thousands of dollars and more, depending on you consumption and dedication level.

Can someone make a living with Amway? The answer is that it's possible but not likely. But as to whether the Amway business and associated tools is a good idea? For that there is no reasonable defense.

Time And Money?

One of the things that Amway uplines do when recruiting new IBOs is to talk about how jobs are dead end, that someday you may be fired, that you have no control of a job, or that you are never paid what you are worth. They convince you that working a job is a crime and tha your boss probably works the longest hours. They may even say that those who make good money working a job often works so much that they don't have time to enjoy it. My former upline used to say that true freedom is the control of time and money. The irony in that is diamonds still need to be at certain places at certain times (functions and meetings) for money, which is not that much different than a job.

What I was also told was that in the real world, generally the guys who have enough money are usually so busy working that they don't have time. Or that a broke guy who's got time on his hands is broke so he can't do much of anything. That's when they would convince prospects that only through Amway can you have both. You can have both time and money. You build it right and build it once, and the (Amway) business will pay you for the rest of your life. That's how it was presented to me and looking back, it was a total lie. I have a challenge for any IBO or Amway defender. Amway's been around for more than 50 years. Can anyone name a dozen people who have actually built an Amway business and then stopped working it but continued to collect a significant income that was actually passed onto their heirs? Can anyone name even one or two? Keep in mind that tens of millions of people have come and gone through the business. Also keep in mind that Amway doesn't make these claims. Maybe someone should ask Amway?

It makes me wonder why crown ambassadors don't even walk away and collect money forever. These crown ambassadors are all old (or have passed away) and have been around seemingly forever yet they continue to work their groups and attend all the functions. Sure, maybe their day to day lives aren't as busy as a 9-5 employee with young kids, but still it makes me wonder why not even double diamonds and above (as far as I know) have exercised the option to walk away and enjoy mountains of residual cash rolling in. I also wonder why there are stories of diamonds quitting and resigning if there was an option to walk away and enjoy lifelong residual income. We also know that diamonds fall out of qualification and we know that many platinums fall out of qualification, providing ample evidence that an Amway business is unstable and that without constant attention, your business is likely to fall apart.

Let me close with this. We know that a typical platinum business has about 100 or more downline IBOs. That doesn't include those who quit. Thus a platinum is already in the top 1% of all Amway businesses and that platinums might not even make that much net income when considering that platinums have many expenses which may include eating losses on tools refunds for the upline diamonds.

Yes, true financial freedom is having complete control of time and money. The problem is that very few people ever achieve financial freedom but it would appear that even fewer Amway business owners achieve that same financial freedom because of the Amway opportunity. Also, showing pictures of mansions and sports cars is not solid evidence of financial freedom. So do Amway diamonds control time and money? It would appear the answer is no.

What It's Like To Hit 4000 PV?

I wanted to give people a glimpse into what it was like in Amway at the 4000 PV level and what my experience was. Although Amway and WWDB apologists will claim this doesn't happen, or that it doesn't happen anymore, I have reasons to believe that very little has changed in WWDB since I was an IBO. The only major difference was that we did call in and product pick up back then. Apparently, some WWDB leaders still talk about buying homes in cash and teaching the same old stuff. And of course, now you order products online. Aside from that, I don't believe much has changed. And why would it?

How many hours per week did I work? I would say up to 30 hours a week was spent on business related issues. Granted, product pick up consumed an entire afternoon and evening, generally on Thursdays. I would have to call in my order to the platinum on Tuesday or Wednesday and then pick up the stuff on Thursday afternoon. Then I had to rush home and distribute the stuff to my downline. My upline platinum was not good at filling orders so it was a real pain. I'd say pick up and associated paperwork costed me maybe 8 hours a week. One good benefit today is that Amway issues the bonuses. In the old days, you as an upline had to cut checks to downline for their bonuses. (This is an area where I agree that Amway made good progress) I did hear though, that WWDB still has call in and pick up for standing orders and other tools. If this is true, then they undid the progress that Amway had made. Also, as an up and coming leader, my platinum expected me to absorb some of the cost of returned tools, such as absorbing losses if someone on standing order quit. (Brad Duncan cut a true north tape at the time that basically said IBOs absorb the cost of standing orders for downlines who quit - too much trouble to call upline who called upline to cancel a standing order. They didn't mind though, calling upline who called upline to add a standing order)

As a 4000 pin, I had to show the plan or attend plans for my front line IBOs. If the platinum was showing the plan. I'd say 4 nights per week we showed the plan for a downline or a downline in depth. Of course after the plan, we might "hang out" with downline and have some night owl teaching. Some people call this association or whatever. Depending on the length of the drive, this might take 3-4 hours 4 nights per week. Sometimes it was shorter when you had no shows.

We counseled with downline and upline. I spent some individual time with my upline and also with downline who wanted one on one time to get ideas on how to improve their Amway business. We looked over their group parameters and of course, tool flow. There was a WWDB counseling sheet for this purpose. Looking back, I"m not sure what this really accomplished except for the big pins to know which leaders are selling the most tools.

Then we had open meetings and functions. One local function each month and generally one or two open meetings where a diamond or emerald would show the plan. Of course, my sponsor (platinum) did not feel right unless he augmented our function with his own night owl meetings. We also had three long distance functions on the mainland. These functions were (at the time) called Leadership, Family Reunion and Free Enterprise day. Being from Hawaii, these functions costed me, as a single, at least $1,000 or more for each trip because it was airfare during peak travel times, hotel, rental cars and the function ticket. I hate to think what couples paid.

Because of my status as up and coming leader, I had the privilege of attending special meetings where our diamond would teach or show house plans. I even had the "honor" or driving the diamond to a house plan. Damn, how can anyone live without such an honor?

For my troubles, I had a business at 4000 PV, with eagle parameters. I was considered a "mover and shaker". Lots of people knew me. My sponsor wanted so badly to break a downline platinum. He sat down with me one afternoon and told me I could really push to platinum and ruby easily if I would only ditch my girlfriend (fiancee' at the time). He told me that he would ditch his wife if the upline diamond told him to do so. He said a single (ruby or higher) could easily attract a lot of eligible women. It was after that meeting when I decided to quit.

I had reached 4000 PV. I was making very little or losing some money because of the tools and functions. I did not see prospects of making money even at platinum and now my upline wanted control of my life. I told my group the truth and all of them quit except 1 or 2 of them who were brainwashed enough to stay involved. That was my story and I have no regrets about my decision to quit. I hope this story helps a prospect or a current IBO to hear about life at the 4000 level.

The Real Losers?

One of the things I recall as an Amway IBO was thinking how sorry I felt for people who were not IBOs because we were all going to be rich and everyone else was a loser. Our upline used to tell us that we were winners - and if you weren't a winner, then obviously, you are a loser. Many times, the term "broke" was attached to the term loser. That was my mindset back then, but having been out of the system more than ten years, I can look back and laugh, realizing that the losers were the ones buying stuff they don't need, stalking people at malls and bookstores, and wasting their time and money on tapes (cds), books and functions. And the irony of it all was that the people in Amway were paying to be taught to think in that manner.

What goes unnoticed in so many cases, is how much time and money really goes down the drain for IBOs who work the system. Your life revolves around the business if you are dedicated and hard core. You are always looking for prospects and people to show the plan to, and you have to rearrange your schedules, or outright skip social or family gatherings because of the never ending number of meetings and functions, many of which teach you nothing about running a profitable business. When I first left the Amway business, I was sort of angry at the time and effort that was wasted, along with the cash I threw down the crapper. You can always make up money lost in the Amway scam but you can never regain the lost time or memories from missing social gatherings or family related events.

But after I did finally cut ties with the business and the people associated with it, I got back into a routine of sorts. I focused on my job and after some years of gaining experience and working my way up the corporate ladder, I received some promotions and I am now retired, well before the age of 60 (50) with a decent retirement income and will likely have my home paid off by then. So while I did have to work a dreaded job to be able to retire, pretty much all IBOs are also working a job or business PLUS having to expend their time and money to run their Amway business which has little to no chance of providing a long term stable and significant income. And if I may add, it is the systems such as WWDB or N21 that usually end up costing the IBOs the most money because of things like the functions.

So I will ask the question. Who's the real loser? The person diligently working and saving for their future or the person chasing an Amway dream that is unlikely to materialize? Factoring in the expenditure of time also makes the systems even more costly than it appears on the surface.

Upline Teaching On Debts?

Getting out of debt sounds like good advice. On the surface it is because people should not be racking up consumer debt or committing large sums of their income for cars they cannot afford. But what does it mean for an IBO? I know my former upline taught our group to get out of debt. However, I believe my former uplines had self serving intentions when they taught this. Let me translate what I believe they meant:

"You should not have any debt because it would affect your ability to buy more PV and tools. If you have debt, it affects my cash flow"

Ironically, for many, maybe most IBOs, although taught to get "get out of debt", the bottom line result is more debt. There is more debt because the cost of products and tools begin to mount. How many families actually spend $300 a month (approximate cost of 100 PV) on household products? And then to add onto that expense, IBOs who are trying to be "successful" need tools which cost anywhere from $150 a month up to more than $500 a month depending on whether the IBO is married, single and the level of commitment. Thus IBOs are now spending at least several hundreds of dollars that they never spent before.

Most IBOs, especially new IBOs, generally earn less than $50 a month. In fact, $50 a month income in this business would make you quite exceptional. Most IBOs earn less than $20 a month. With that kind of income and with the expenses I listed above (tools = voicemail, books, standing orders, and functions), nearly all "serious" IBOs operate in the red and never turn a profit. The only way an IBO can turn a profit is to sell Amway products like crazy (which I have never witnessed) or to sponsor enough downline to absorb the losses for them. The only true success stories are the ones who sell the tools.

The reason why I believe that my former uplines (who are still in WWDB and apparently teach the same things now as they did back when I was an IBO) are teaching self serving advice because although they said to "get out of debt", they made an exception to this and said it was perfectly okay to go in debt to attend functions or to buy more standing orders. IBOs were also told to do "whatever it takes" to get to the next function or to buy more tools. It is why I witnessed some cross lines go bankrupt, more than one couple lost their homes following upline advice. And these couples were told they shouldn't worry because they can pay cash for their homes when they go diamond. Another apparent lie told by WWDB leaders, especially those who had their own homes foreclosed.

Let's be perfectly real here. If you join Amway and participate in the system consisting of voicemail, books, standing orders and functions, you are far more likely to get into debt or increase your debt rather than making money and getting out of debt. The math bears it out if you are willing to look at it objectively.

Amway Makes Me "Nicer"?

Many IBOs "think" they have become nicer/better people as a result of their association with other Amway IBOs and because a part of the system they are with advises them to read self help books. They are also taught that as a side benefit of the Amway business, that they are nicer people. Of course, many IBOs mistakenly think that they started a business not to make money, but to become "nicer". The entire premise is ridiculous and upline uses this approach to take the focus off the fact that IBOs are not making money. Thus they will say Amway makes you a nice person, or Amway will save your marriage or some other baloney.

I certainly agree that some people can benefit from positive books and association with others, but for many, it is not a genuine "nicer" person, but simply a phony persona that is put on in order to recruit potential Amway downlines. That is how my former sponsor appeared to me. Because I had known him for a long time, the "nicer" looked as phony as phony can be. There are many examples of phony niceness that some IBOs profess. Even Amway's biggest defender (David Steadson AKA IBOFightback) was called a "cyber bully" by an Amway corporate blogger and some others for making disparaging comments about those with opposing views. Others have resorted to calling people broke or losers simply because they did not agree that Amway was their savior. Is this an example of being a nicer person? Doesn't seem like it to me.

On this very blog, there are comments, I assume by Amway IBOs, that make implied, subtle threats and in some cases, direct threats against me and others. Some of these comments are not subtle at all. In fact, in my blogging experience, it is usually the IBOs and Amway defenders that resort to name calling. I suspect that is because the facts are on the side of the Amway critics. For example, it is a fact that most IBOs never make a dime, even if you don't count the ones who "do nothing". If you look at system IBOs, then the vast majority never make enough to pay their voicemail expenses, let alone anything else. The IBOs will say that they are paying for education like a college student. But college students can list their education on a resume even if they did not graduate. What does your Amway education do for your resume other than giving an employer a good laugh?

Even the coveted diamond level appears to be a facade, especially seeing diamonds quit, resign and simply walk away from the business without the lifelong passive income. A triple diamond's bankruptcy revealed some poor financial decisions and planning and his income as a triple diamond wasn't all that impressive considering the size of his business plus longevity in the business. This triple diamond made about half a million dollars from Amway. A good income, but not one that will finance paying for homes in cash, owning a fleet of sports cars, or a jet. The diamond lifestyle might be one of heavy debt if people try to portray a life of excessive wealth. Many Americans live in debt, why would diamonds be any different?

So IBOs, are you a nicer person? Is it evident by your words and actions? And how does that translate into making a profit from your Amway business?

Amway IBOs Are Doomed?

Even though diamonds and big pins in Amway like to show off fancy material goods such as sports cars and mansions, the vast majority of rank and file IBOs will never get close to attaining those kinds of trappings. In fact, once an IBO agrees to get on standing order and to attend functions, that IBO is more than likely doomed for failure. Most business building IBOs don't even make enough income to cover the expense of their voicemail subscription. When you take a look at the Amway business presentation, you will see that most IBOs who qualify for a bonus will earn something like $10 a month. Thus all those lower level IBOs are guaranteed a net loss by participating in the system.

One could argue that simply consuming 100 PV would put you at a loss, except that technically, it's not really a business expense. But it can be a business expense if you are buying products just to familiarize yourself with the products and/or to reach your PV bracket. In other words if you are buying stuff that you don't need in the name of earning a bonus. I had a fellow cross line IBO who actually went and purchased 1000 PV in a month because our upline diamond had a 1000 pin play day and this IBO had no downline. Thus he likely purchased most of if not all of that 1000 PV by himself.

Because of a spotty Amway reputation and the fact that it's very hard to sponsor downline and get retail customers, most IBOs will be doomed for failure once they sign on to become IBOs. Their problems and financial losses mount and get exponentially worse once they agree to sign on and dedicate themselves to the system. While the system expenses may seem benign at first, IBOs often find that losses can reach or exceed tens of thousands of dollars in a relatively short period of time.

In my opinion, what makes all of this so sickening and somewhat even evil is that an IBO or prospect will be told that the system is proven. That you are practically guaranteed success by following the system. Then after spending thousands of dollars and not making a dime, these same IBOs might be told that they are at fault for not making it big in Amway. That failure is the fault of the IBO. Or that the IBO did not follow the system as prescribed. I know that many IBOs, whether they work hard or follow the system or not, are still doomed for failure because the system doesn't work. There is no bonafide and unbiased evidence of any kind that indicate that the system works. The system only works if you are one who profits by selling the system. The rest of the herd ends up losing money. There is no question about it.

The Math Behind Amway And the Systems?

It is my observation that people who join Amway usually end up losing money in the end. They may get involved to make a few bucks or because they are mistakenly led to believe that they will become millionaires in Amway in 2-5 years. I know my sponsor convinced me that we would be millionaires in a few years. These folks who recruit new IBOs into Amway are often associated with a "system" such as Worldwide Dreambuilders (WWDB)or Network 21 (N21). These system promoters, often diamonds, may mislead the recruits by showing them pictures of mansions or other luxuries, implying that they attained these goods with their Amway business. In many cases, it is a deception, especially when we know for a fact that some diamond leaders who proclaimed that they only make cash purchases, had their homes foreclosed. Without the hype, I am sure there would be fewer sign ups. But what is the evidence?

It is simple. Amway reports that the average active IBO earns about $200 a month in gross income. This average includes diamonds and other higher end IBOs. I believe if you calculated the median, the average would be much lower.

But what makes IBOs operate at a loss is the system expenses. The system generally consists of voicemail, standing orders, cds, functions, books and other materials. An average business building IBO might spend an average of $250+ a month or so on these expenses. Amway defenders like to decry the amount, but there are couples who would likely spend more and IBOs who must travel by air to functions would spend more. Single IBOs who buy only the minimum might spend a bit less. Some IBOs with abusive uplines might spend much much more than $250 a month on tools. I believe my former sponsor spent easily an average of $1000 a month on average. (I am from Hawaii so the average cost of functions is greater due to long distance travel)

Thus if the average IBO earns $200 a month but the same average IBO spends $250 a month on tools, the average active IBO is losing $50+ a month, with lower level IBOs (i.e. 100 PV) would lose more.

Look at a group of 100 IBOs at 100 PV. (This is just a model). If a 100 business building IBOs average $250 a month on tools, they as a group would expend $25,000 a month on tools and functions. Their volume would be 10,000 PV, or about 30,000 BV. This would generate about $7500 in bonuses per month. Thus this group spent $25,000 to learn and be motivated while the group splits up $7500 a month in bonuses. The platinum would get the lion's share of the bonus but most of the rest of the group will suffer net losses. As the group grows, the bonus may grow, but so will their expenditures on tools. Keep in mind that a group of 100 IBOs spitting up $7500 would be an average of $75 each. It is the diamonds that drive up that average. The math bears it out.

The only way the group can make money as a whole is to avoid participation in the tools altogether and to actually sell products to non IBO customers. The evidence is right here with simple math. The systems do not work because the cost of the system is likely to consume all of the Amway generated bonuses and more. I gladly challenge anyone to explain in detail how this post is not reflective of the reality of being in Amway and a system such as WWDB or Network21.

The facts speak for themselves.

Get Rich "Slow" In Amway?

One of the things upline used to say was that Amway is not "get rich quick". I suppose they say this because most people would more likely think scam if they promoted it that way. (I believe Amway is a scam) Ironic, but when you stop and think about it, 2-5 years, build it right and you have willable, residual income for like while walking the beaches of the world? That's not get rich quick? Or is it more of a disclaimer so that the opportunity doesn't sound "too good to be true"? One thing is for sure, even if uplines tell you that it's not get rich quick, it's obvious that IBOs think they will eventually get rich, even if it's not quick. Amway leaders have said "Amway is get rich slow".

What most IBOs don't figure out quickly enough, is that they are unlikely to even make a profit, let alone getting rich from Amway. How many of these retired Amway people exist? Where are all of these retired Amway IBOs who built a business in 2-5 years and then walked away from their business and will be collecting a significant residual income for many years to come afterwards? I don't know of a single person who has done this and none of the Amway defenders and zealots I have encountered over the years has been able to supply this information either.

I can acknowledge that Amway is a business opportunity and will definitely take some work to be able to achieve something. But thinking realistically, what business could you actually be able to walk away in 5 years and not work again? More than likely that business doesn't exist, whether it's Amway or not. Say you opened a conventional business. There wouldn't be many scenarios where you could walk away after a number of years. The business would still require work and maintenance. But for some reason, people are mislead to believe that you can do this in Amway where there is a high attrition rate and where your business can only expand by person to person, which is quite inefficient.

Sadly, many of the people who are attracted to the Amway opportunity are often young people looking to get more out of life. They are often ambitious but may lack a means to gain wealth, thus the appeal of the Amway opportunity is there. Unfortunately, these nice young people are more likely to end up channeling their hard earned dollars into standing orders and functions which will almost guarantee that they end up with a net loss. The bottom line is that not only is Amway not get rich quick. The more likely scenario is that your involvement with Amway will very likely be not getting rich at all. A net loss is the most likely result. The real life results and Amway's own disclosures suggest that I am spot on.