Your "Chances" In Amway?

One thing that many Amway promoters don't like to talk about is what your realistic chances of success are. I will define success as Diamond because that is what the outcome of the 6-4-2 and 2-5 year plan. Of course you may be able to earn some income at lower levels, but my understanding is that diamond is where the real money from Amway and the tools start rolling in. And I can also understand why people promoting Amway do not discuss your realistic chances of winning. Afterall, lottery promoters do not show you the millions of losers, they only parade the winners in front of you.

Many people, including Amway enthusiasts will agree that many IBO do little or nothing. Some people never even place an order or make any attempt to do any business. For the purpose of this article, I am not speaking about these folks. I am talking about people who actually put in some effort to the business.

For many people who want to make an earnest effort, they will purchase and hopefully sell a few items with the goal of reaching 100 PV. For that effort, you will receive approximately $10 from Amway and whatever profit you might have earned by selling products. Here's the catch. You will likely need to pay website fees in excess of the $10 you earn from Amway. For the more dedicated IBOs, you may be payin for voicemail, standing orders, book of the month, and possibly attending functions. These expenses will exceed your income month after month unless you are able to increase your volume by selling enough products and/or sponsoring downline who buy and sell products.

Because Amway has to include the IBO bonuses in their prices, the products come at a premium price. Thus sales to non IBOs are relatively low. Without sales to non IBOs, the only other way to generate more volume is to sponsor people who will buy and sell products. But due to past unethical IBO behavior, getting people to see the Amway sales and marketing plan may be a challenge. Also, most IBOs are unable to sponsor a single downline.

Some Amway enthusiasts will claim that if you do their CORE steps for 2-5 years consistently, that you are likely to succeed. Sound easy, but becaue of the factors I have identified, some of these steps are impossible to do consistently. It's not like walking a mile each day where you have control of the step. People will likely fail in showing the plan and sponsoring others because they cannot find enough people who are willing to see an Amway plan. Many, possibly most other IBOs can and will do certain steps consistently such as listening to a CD daily and reading a success book. But because of a spotty reputation in the US, IBOs will very likely fail to be able to show enough plans to succeed.

Your realistic chance of success? My informed guess is less than 1 tenth of 1 percent. That's the likelihood of going diamond. Your chance of going platinum? My informed guess will be less than 1/2 of 1 percent. If you think you can beat those odds, go for it. For most people, it might be wise to look into other opportunities.

Amway Is Fair?

One of the many bogus things my upline taught us was that the Amway opportunity was fair. That it was a completely level playing field. On the surface, that sounds right because "everyone starts at zero". While everyone does start at zero, the compensation plan is unfair to those who "do the work" and in my opinion, should be revamped so lower level IBOs make more money. It would probably help with IBO retention and maybe, some higher level leaders wouldn't have to work so hard to keep replacing people who quit. 

If you are a new IBO, then you might not be really familiar with the Amway compensation plan. Amway pays out about 30+ percent of their gross as bonuses. Thus if you move 100 PV in goods, or about $300 in sales, then Amway pays out about $100 in bonuses. You as a new 100 PV IBO, would receive about $10 and your uplines, some of whom don't even know you exist, will split up the remaining $90 in bonuses. It truly is not a case of doing the work and getting paid. You are doing the work so upline gets paid. To add insult to injury, upline wants you to purchase materials that tries to convince you that this is a good deal. 

And something very significant to think about. In what other sales profession are you compensated so low (3%)? I can only think of real estate, but in real estate, your sales are likely in the hundreds of thousands of dollars. In just about any other sales related profession, you get a much higher cut than 3%. Yes, your bonus or comission can be higher if you move more volume, but then you are likely receiving more money because you are now exploiting people doing 100 PV who get only $10 back. 

Even after you consider the unfair compensation, you must factor in the cost of tools. Most uplines promote tools (cds, voicemail, functions) as vital to an IBO's success. Some uplines push the tools harder than others. But the tools purchases will often be the primary cause of IBO financial losses because the cost of tools will normally exceed an IBO's bonus. It is very common in the US for monthly tool purchases to exceed $200 a month on average, and very very few IBOs will ever reach a high enough level in the Amway compensation plan to earn enough just to break even. Also, the tools apparently do not work. There is no unbiased evidence to suggest that tools have any causal relationship to IBO success. 

With Amway's spotty reputation and the unfair compensation plan, IBO retention is spotty. Many IBOs sign up and do little or nothing, and many IBOs don't even last a full year before they quit. What happens is IBOs begin to figure out that recruiting downline is next to impossible and therefore, generating more volume is nearly impossible, even for individuals with skills. If you are a new IBO or a prospect, I encourage you to sit down and really look at the math and factor in the cost of tools. There are many ways to earn a dollar, I just don't feel that Amway is an efficient way to do that.

What Financial Freedom?

Merry Christmas Blog readers!

Financial Freedom! That was one of the major battle cries when I was recruited for the Amway business. You gain control of time and money by creating residual or passive income. That is true financial freedom. You wake up at noon, no job, and just do whatever you please, whenever you please. I remember the speaker saying that broke/unemployed people also had freedom, but it was different because they were broke and could not afford to go golfing or do other activities that required money on a regular basis. 

I am assuming that this is still the case for many IBOs. Of course, upline leaders may toss in a disclaimer that you don't get rich quick as an IBO, but the pitch apparently still contains the financial freedom and residual income theme, based on my experiences with IBOs. IBOs still think they will be rich. Also, 2-5 years sounds like "get rich quick" to me. 

But hey, financial freedom would be a great thing, don't get me wrong. Who wouldn't want to be 35 years old with enough cash to never have to work again? I mean I could spend some time imagining how fun that would be. It would also be fun to imagine what you would do with all the cash if you hit the powerball lottery as well. But for the starry eyed IBOs, I simply have a few questions for you to ponder. A few realistic questions that you should be asking yourself. The answers to these questions will tell you a lot. 

1. Who in your group or upline truly has achieved financial freedom? Have you seen their financials or simply a display of wealth such as mansions and fancy cars? Mansions and fancy cars could just be a massive pile of debt. Not too long ago, there apparently were diamonds who had their homes foreclosed, and a triple diamond who was in bankruptcy proceedings. Find out if anyone in your group/upline has actually achieved the success that they are using to recruit you. Also, if they are financially free, why do they work at function after function? Traveling and speaking might not be a traditional job, but it is still work, nonetheless. 

2. Even if you find someone who is retired and golfing everyday because of Amway residual income, ask yourself what the likelihood is that you will be able to achieve the same results. If diamonds are still working, what chance do you have of success if you are new or experienced in Amway, and have few or no downline. More than likely, your chance of winning the lottery will be greater than your chance of achieving a significant residual income from your Amway business. Also, I don't know of any Amway retirees who built their business once and walked away with any significant residual income from Amway. Do you?

LOL, Amway Business Mentality?

One of the things IBOs "think" they posssess, 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 and 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. 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 bull crap. 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.

"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, recently 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.

"Submit to upline" Another load of hogwash. Why should someone submit to upline simply because they "sponsored me" or whatever? 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 "Indepdendent 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.

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 here and get more information before proceeding with any more "business" activity.

IBOs Help People?

One of the things my Amway upline said at nearly every meeting was how we were helping people by sharing the dream and showing others the Amway plan. "Helping people". He claimed that IBOs became better people and were doing good for the community by helping people. I always thought ths was odd because the only people we really "helped" were those who got into the business. We didn't hang out with or help anyone else. We certainly didn't do anything for the community or for charities. 

How do you help someone when your life is dedicated to buying and selling Amway products, recruiting Amway prospects and attending Amway related meetings to learn how to recruit more Amway IBOs and to motivate yourself to never quit the business. I used to think about people doing volunteer work, or community service projects, or even outreach through their churches. These are the real everyday heroes who are helping others. While an outreach volunteer feeds the homeless, IBOs are in meetings. When people are doing community service projects, IBOs are showing the plan or prospecting the malls for new recruits. Who is actually helping people?  

Yes, I am aware that IBOs at times, contribute to Easter Seals and the like, but do they invest the kind of time that others do? And I'm not faulting IBOs, but simply pointing out that the Amway business activities can eat away at your time and prevent you from spending quality time with family and friends, and prevent you from actually "helping others". While the Amway business is no different that other businesses and the like in that regard, I do not feel that the tiny average earnings of IBOs make it worth their while to spend all of that time in meetings and recruitng to make their return on their investment a worthwhile activity. 

So in all of the activities you engage in as an IBO, are you helping people? Or are you only helping people who might be interested in joining your Amway business? Are you really helping them or recruiting them under the guise of helping them? Do you continue to try and help them if they aren't interested in Amway? Isn't the IBO saying "some will", "some won't", "so what, next"? Doesn't that mean that prospects are expendable once they have said "no" to Amway? That's what I recall from my IBOs days. I really don't think much has changed.

The "Amway" Lady?

Great post from another blog: 

http://corruptionincortez.blogspot.com/2012/06/june-4-2009-amway-lady.html 

"As I stood next to my hot cab on a warm summer afternoon a nice lady came over and talked with me for a bit. She was probably in her late 50’s, and was quite pleasant. It was quite slow so I spoke with her about the “island” and engaged in general small talk. She mentioned that she liked the drivers in Cortez and would periodically take a cab home to her place in La Mesa. Since we had a good rapport I passed along my business card and told her to drop me a line if she ever needed a lift home. 

A few weeks later she called me, but not for a ride. She had a business proposition that she wanted to discuss with me. I obliged, looking for a way to supplement my income. We met at a Starbucks where we went over the business model as well as what was expected from me and what was possible to achieve. It sounded too good to be true – it was… I was skeptical, but I gave her the benefit of the doubt. What made me immediately suspicious was that she seemed to be overly upbeat and didn’t mention the company name. The conversation was centered around commodities – things that we will buy throughout our lifetime (food, toothpaste, toilet paper, paper towels, etc…). She invited me to a second meeting and informed me that she would follow up with the details shortly. She was persistent. I had free time that Wednesday evening, I left a spot open. 

When she called to explain where the meeting would be I realized things were becoming even stranger. The gathering was to take place at a house in a cul-de-sac in La Mesa. There would be fellow entrepreneurs there. Or so it would seem… 

When I arrived I was in denial. An older couple, presumably in their 70’s served up cookies and smiles and told me to grab a seat on their couch. Then the clean cut guy with the suit came into the room, complete with a slick haircut and a cool demeanor. He talked of massive profits with minimal effort, while scribbling fractions and graphs on the whiteboard in front of him. And then came the kicker. He was selling Amway. My night had been a total waste. I didn’t want to be rude and walk out, everyone was so thrilled to have the company. They were serving up shit sandwiches and I was forced to take a big bite. For those of you who don’t know, Amway is a pyramid scheme. Basically the people at the top of the pyramid (the recruiters) make money off of the people they recruit by keeping a percentage of the sales that you (the recruit) sell. Any people that you recruit that happen to sell anything, well you would get a portion of that, as well as the person who recruited you. The person at the top gets a portion of everything. It can be profitable, if you are willing to harass your friends and family relentlessly by peddling your crappy Amway products. You have to be willing to act shamelessly. In retrospect, it would likely be a good position for many of the other drivers… Eerily, the other drones that attended the meeting were surprisingly gung-ho about the whole thing. They drank the Kool-Aid, right down to the last drop. 

I told Alice (the Amway lady) that I would have to consider it. She was quite pushy. This was her time to seal the deal, to have me become further invested in their enterprise. A few days later she called me again and I told her that I would not be attending any more meetings. I was polite – something that she was not. She just threw a fit and acted like a child, by explaining how I was making a big mistake and missing out on a once in a lifetime opportunity. I wished her the best and reassured her that she would find people who much more eager to become filthy rich selling junk from Amway."