I have been reading some ongoing debates about whether the system income for higher pins is more than their Amway bonuses. I believe the systems such as BWW, WWDB, N21 or LTD, does generate more profit for upline than the sale of Amway products. How the system income is divided though, is still a mystery as it doesn't appear that there are bonafide written contracts explaining how tools income is split up among the higher pins. There is also the debate of whether diamonds themselves or their "corporations" receive the profit, which is laughable as a defense.
But it's very easy to determine that more income is made from the system than from Amway. If you move $100 worth of Amway products, Amway will pay about $33 back in the form of bonuses. These bonuses will be split among the Amway IBOs (middlemen), depending on your level. On the other hand, if your group bought say 20 cds at $5.00each, the system will profit about $90 as cds cost about 50 cents to a dollar each to produce in bulk. Some Amway apologists will cite the fact that some groups sell cds for $2.50 or $3.00. While this is true, there is a "member's fee", such as WWDB premiere club, which must be paid. And when you add in the member's fee, the profit for the system is the same or possibly higher! Even when you factor in the system employees, you can easily see the math and determine where the real money is made.
If you buy a major function ticket for $125, the cost of that function might be in the neighborhood of $25 to $30 per attendee, so the system may generate $100 profit on a $125 sale. I believe the smaller functions such as open meetings, books and voicemail have smaller profit margins, but still overall, it's easy to conclude that the profit from the system is greater than profits generated by moving Amway products. I might add that the sales on these functions are often made in cash, thus who knows if the diamonds are even paying the IRS taxes on these sales.
The only question is how much each individual earns. I have "heard" that platinums get a discount on the sale of standing orders and cds, but I have never heard of a platinum sharing any profit for functions, voicemail, or any of the other materials. This is puzzling to me as I believe the platinums do the most work in the system, helping downlines. The platinums are the backbone of the system but unless they break through and become a higher level, they earn pennies for their efforts.
So for the lower level IBOs, if you move $300 in Amway sales (Approximately 100 PV), you will receive about $10 or 3% while upline enjoys the rest of the $90+ in bonuses from Amway. And then when you purchase and move tools volume, you receive nothing and some of your uplines enjoy all of the profit. While I don't see any problem in upline making a profit for selling training materials, I see a problem in the fact that the tools are ineffective. So few IBOs progress to levels where an actual profit is earned that the use of tools cannot be justified. Amway supporters will point out the new platinums emerging each year, but do not mention the platinums who do not re-qualify and platinums who outright quit because they are bleeding money.
Based on my observations, I can only conclude (quite easily) that there is substantially more profit from the sale of support materials for upline to enjoy, and I can also conclude that the support materials are ineffective in training downline IBOs so they can progress to higher levels of the business. But as PT Barnum once said, a sucker is born every minute.
7 comments:
Merchants of Deception outlines this perfectly. MLM is a scam.
WWBD 2019
Communikate $36.95
WWBD App $84.95
Amway is all online and one orders directly from the website. Just like if you were to order from Target.
They got rid of CD's and all of the audios are done through the app. Also, they are getting rid of Dream Night due to the cost/ way too many cities so they are planning that for next year they will have a live stream and IBO's go to someones house to watch it.
If you haven't seen this couple yet, follow Ze, Melody and Seven on youtube. They have been doing a series of videos against WWBD/Amway. One of them encourages folks to report WWBD to the FTC. Also, they mention/ask how many IBO's have REAL customers because it is illegal if they don't. All of a sudden there is a mass wave of trainings of how to get customers in the board plans and Kate.
My spouse still believes in the cult and as we have gone to the major functions, (yes, I still go because I refuse to let this be an argument between us), my spouse has noticed that they tell us to ONLY eat from our "store" but yet the platinums were buying pizza/soda at the venue. We also heard one of the platinums say that they don't pay for their regional/major function tickets after that level. How true that is I have no idea. We decided to look up one of the venues that the Diamond rents out for only their organization, if they choose the most expensive room for 5 hours that can seat 900 people and $15 a person, there is still a profit of about 4 grand after the total costs of the venue. Who gets that 4 grand?
As a former "Big Pin" in a major organization I can say the following:
There was a "system" contract that in order to participate in system money you have to do certain things such as attend all conferences outside of extreme reasons, "be a blessing" upline and downline meaning don't speak ill or criticize the system, operate a moral business, etc. There is no guarantee that you will participate in system money, that is solely at the discretion of the upline as well as the amount since they say they have the right to set the price of system tools and then you also have the right to set the price that you will sell the tools for- kind of like Amway's policy that allows you to sell the products at your determined price as an independent contractor.
As far as money generated by conferences, there were different "pots" and your Pin level determines which pots you participate in. In the system I was in, those pots began at the Platinum level with pots for Emeralds, Diamonds, on and on. A certain amount of each ticket was put into each pot and the higher up you went the more pots you were able to draw from as you drew from each pot you were qualified for. Also, the less number of people participating in those pots, the less the money was divided. You also got a bigger part of the pot if you brought more people to the conference since it was a "per ticket" amount that went into the pot. There were also pots generated by kickback money from concessions, hotels, etc. and those pots were only available to the "very high up Pins". Those pots easily be huge and only divided among 1 or 2 people who "qualified".
As more things went online, I became disillusioned when I saw how much effort was made by the "leaders" to preserve their cashflow on tools and conferences rather than looking at making Amway training less expensive, more effective, and more easily accessed by the IBO's. They created things like "Exclusive apps" that IBO's had to pay for in order to get info and stay connected when they easily could have used free technology but these apps made them a LOT of money and still do.
As for the question on income, the bigger pins easily make double, triple, quadruple, or more in system money vs. actual Amway . In my case, it was about triple and I wasn't even at a huge pin level.
Amway is a decent business. The team systems do help people develop a business mindset and learn but they are way overpriced and are a huge money-maker for the bigger pins. My advice? Find an MLM that provides lots of free training resources and really cares about building their business by building their members.
Finally -- the real truth.
Thanks for the shoutout!
When I first launched no one could have convinced that this was a made system, everyone is so nice. My upline and his upline checked in with me everyday, they told me how amazing I was and how much I was going to bless people. It took about 2 months for that to stop and it got twisted quickly. Friendly calls started to become intrusive, they wanted lists of names of neighbors, friends, my boyfriend and his friends. They wanted access to my social media for names. The more no's I received from people in my life who weren't interested the more insistent my upline became with me disengaging from negative people. I was even told to stop visiting my parents as much because they weren't interested in buying overpriced products! This eventually built into noticeable tension between myself and upline and a fellow crossline encouraged me to watch Ze and Melody's online videos. That's when things got really wild. I started asking to many questions and I was flat out told all everything....everything on the internet that was negative about WWDB was a lie. what??!! I realized I had joined a cult. I dropped out, changed my phone number and made a complaint to Amway.
The crooks in WWDB and all the other LOS subsystems have to say that everything on the internet about Amway is a lie. This is the only way to convince IBOs never to look at anything posted on the internet about the Amway racket.
If IBOs were given the OK to read internet postings about Amway, they would immediately begin to think for themselves, and start asking a lot of embarrassing questions. Your up-line doesn't want that to happen, because they really have no valid answers to the many trenchant criticisms of Amway and MLM that have been raised here and at dozens of other websites.
Being in Amway is like living in a Communist country -- you can't criticize anything, and you are forbidden to even think for yourself.
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