What’s Your Bottom Line?

Sadly, I recently discovered that one of my friend’s adult kids have joined an MLM.  While it’s not Amway, the pitch is pretty much the same.  Buy the products, sell the products, and recruit like minded people to duplicate what you do.  It was eerily similar to Amway in that you are purchasing highly overpriced and likely overrated nutritional products.

I was not shown the compensation plan but more than likely, the rank and file distributors earn little and layers and layers of upline take the lion’s share of whatever bonus is generated by personal consumption and whatever customer sales that may occur.  Based on the prices I observed, I would guess that mainly sympathetic family and friends are the only ones making purchases to show support for the kids.

Now training and functions seemed to have been a part of the overall package although the distributors did not wear business attire to meetings.  But one common denominator was that the kids did not know what I meant when I queried them about profits and losses, as if I spoke in a foreign tongue.  I said surely a business owner tracks expenditures and income.  When it sounded like they didn’t understand what I was getting at, I asked what their bottom line looked like.

So I went on to explain that each week or month, they should be adding up all if their expenses and all of their income.  If the expenses exceed the income more often than not, then they are running a lose money business and need to determine how to adjust their actions to lower expenses and make more income,   It had not occurred to them that they should do this.  So like Amway and probably other MLMS, their financial guru uplines don’t teach business 101 to their down lines.

Uplines don’t teach their followers about the bottom line because the bottom line is bolded red ink.

The Standing Ovation?

One of the weird things I observed about Amway IBOS is how they worship the diamond as if he is some kind of divine being.  When you look at it logically, what has the diamond done to deserve such adulation?   The diamond qualified for the pin one time and possibly one time only.  Heck, Joecool was a 4000 pin.   Does that mean new IBOS should take counsel from me since I achieved a fairly high level?  Even if I’m not currently qualified?

Amway doesn’t say which diamonds are still qualified so nobody really knows.  And that is why you see former copies of bonus checks as evidence of success.  A current copy of a check would be better but still would not indicate what kinds of expenses that diamond had.

A good example would be my WWDB upline diamond who probably qualified diamond in the 1980’s.  Back then there was no internet and the business was very different than it is today.  That diamond also filed fir chapter 7 bankruptcy in 2009 or so but is still revered as having superior financial acumen.  But based on what track record?

Fir some reason the audiences just assume that the diamond is successful and wealthy without really knowing the financial status of these leaders.   Fir all we know these diamonds are paying mortgages and in debt like the rest of the US population.  Why would it be any different when these diamonds show off a lifestyle of excess and even encourage IBOS to get into debt to purchase tools and function tickets.  If you ask upline to verify their financial claims you’ll be told it’s none of your business.

If your diamond’s financials are none of your business then you should not consider displays of wealth as any kind of evidence of success.  More likely that diamond lives check to check like much of the rest of the population.  What other conclusion is logical?

My Upline Helps Me?

One of the things that my upline constantly emphasized was how Amway IBOS were helping people and that they were helping us to help people.  Now that sounds so selfless and altruistic on the surface until you step back and take a really close look at the details.  IBOS are often star struck by the upline diamond and often don’t notice that any help they receive from the diamond is help that they pay for in the form of an oboe recruitment meeting, a standing order or a function.  We could debate about how much help you get if you don’t cough up some dollars.

Secondly, do you call it help if you’re paying?   Is the plumber helping me or did I hire him to fix my pipes?   I guess you could call it help but somehow the shine is taken off the coating if you paid for the services.  But the way upline presents it, you’d think they flew or drove fast distances for free when in fact they are handsomely rewarded via honorariums or by other tool sales such as standing orders.

Are you really helping soneone if they sign up only to lose money by following upline advice?   Are you helping a prospect because you truly care about them or do you care more about the potential business that they might represent?  If you would not help them sans Amway then maybe your intentions are not as pure as you think.   I’m pretty sure that upline’s intentions are focused on business potential and nothing more.  To illustrate my point, how much help is given to a prospect who turns down Amway?  Isn’t the saying “some will, some won’t, who cares, next”?   Is that the slogan of soneone who really wants to help soneone?  It sounds conditional to me.

So for those holier than thou Amway folks, is your upline really helping you and prospects or are they being courteous to you and other prospects simply because you represent potential future business to them much like a car salesman?   How much help do you get if you miss functions and don’t buy tools?  I think the answer to this will allow you to conclude the truth about your upline.  They don’t give a crap about you unless you are buying tools.  Sorry if the truth hurts.

Accountability?

One of the biggest things taught by upline was accountability.  If you said something, then be good to your word and get it done.  Be a man of your word so to speak.  In business that seems to be good common sense and who would want to do business with someone who can’t keep their word.  But it’s all a “do as I say and not as I do” situation with upline.

Upline expects downline to meet their PV defacto quotas and to buy tools and attend all functions and meetings.  After all, business just works out better when everyone keeps their word right?  But what about upline?   Where is their accountability?  They ask you to trust them and invest your time and money into the business and to follow their advice but who holds the upline accountable?  Why does upline seemingly get a pass on their accountability, especially when their advice costs you money?

Seems gray upline somehow skated past accountability by blaming downline for their own failure even if the downline follows the advice down to the last detail.  That’s the sinister part about upline.  They give you advice that you pay for and then blame you if their advice fails.  Think about this, other than feeling pumped up a bit, did any function directly result in more sales or more downline that you sponsored or did the function just leave another hole in your savings account?  Or worse, did you go in debt to attend an ineffective function?

It puzzles me how upline gets paid for their valuable advice but nobody calls out upline when it doesn’t work.  If you buy something at a store and it doesn’t work, you take it back for a refund. If upline advice fails you, why not hold them accountable and ask for your money back.  Surely a wealthy diamond can afford to refund money for ineffective advice?  

All The Motivation You Need?

It seems to me that the Amway business became a never ending series of meetings and rah rah speeches designed to motivate the rank and file IBOS.  I suppose that so much motivation is needed because the vast majority of IBOS are losing money chasing the Amway dream.  But a nice story told by the diamond can get a low ranked IBO to hang in there and attend a few more functions and listen to more audios.  Of course those actions benefit upline more than the IBO.   If IBOS were to just walk away, diamond income would be affected,

But what motivates business people?  How about net profits and having more money at the end of the month than when you started.  I know that would have excited my to be cash positive in Amway.  But because nearly all IBOS are losing money, upline must devise ways to trick people in signing up and then staying on board.  Let me illustrate this:

When being recruited, I was told about how Amway was low overhead and that profits could be made quickly in addition to saving money by using Amway products.  Then after you get in, you’re told that business owners commonly lose money fir a number of years until the business it built.  It becomes an eloquent game of bait and switch for the upline and downline.   Sell them on quick profits and savings and then tell them about being a real business owner with real expenses.  It works because the upline are taught to trust and believe in upline.

The claim is that upline has your best interest at heart.  But I guess one more lie told by upline escapes many rank and file IBOS once they put their hope and trust in the upline.  And it works because people want to believe that 2-5 years of hard work will lead to retirement and financial freedom.  Sadly it usually ends in business losses and additional debt.

The Tool Scam?

What I didn’t catch right away as an IBO and what many Amway IBOS and prospects don’t notice is that functions and support materials sold by the upline diamond is the real Amway business and the Amway products are actually secondary in many cases.  Think about it, rock stars make their fortunes by selling audios and concerts.  Amway diamonds sell audios and function tickets among other things such as voice mail systems and other materials.

And with food for thought, audios cost cents to produce and a function is similar to a concert.  Another thought for the Amway faithful is this:  are these materials helping you to sell more products and to increase your business income or are these expenses becoming the reason you are losing money in your business?  If you are paying for this training and motivation, then shouldn’t your business be growing each month?  If not, why not?   And if not, why keep paying for ineffective training?   Since the diamonds have much to gain with down line success, why aren’t any of the training sessions free?  I think you get the idea.

Approximately 10 years ago, a triple diamond filed to chapter 7 bankruptcy and the documents were public.  They diamond made just as much from tools and functions as from Amway.  Now you might ask what’s wrong with paying for advice?  Maybe nothing but making payments monthly or weekly for advice should result is some kind of success.  Where is that success or where’s the fruit on the tree, as some diamonds used to say,  the tree is withering and dying apparently.  

It’s very simple.  The diamonds entice people to join by implying test untold wealth and lifestyles can be yours by using and selling Amway stuff and you too can be wealthy if only you will dedicate yourself to following the advice that they can give you.  And that my friends, is the Amway tool scam.

The Illusion?

Many people have seen a magic show or an illusionist.  Most people are amazed with the show but at the same time they realize that it’s a show and that you can’t really saw people in half or make an elephant appear out of nowhere.  I believe it’s no different in Amway but so many prospects do not realize that the diamonds are just putting on a show.  They are showing prospects the illusion of wealth.

If you lived next door to an average diamond or did their taxes for them you would likely see right through the facade.  You would see the nice suits and appearances at a function but these diamonds likely go home to middle class houses and an otherwise normal lifestyle.  Potential recruits only see the show and think these folks live a first class lifestyle every day.  Of course it’s hard to sell people on an opportunity if you aren’t showing fancy things and lifestyles.

Let’s say a diamond makes $250k each year and has a wife and two kids.  After taxes and other things such as medical insurance and business expenses a diamond might still have a decent income of perhaps 6-8 thousand per month.  But that kind of income cant purchase homes and sports cars in cash, let alone fabulous vacations.  And if that diamond in a faithful church goer as many claim to be,  10% of their income should be tithed to the church.

So if you sit and carefully consider what I’ve pointed out here, how can a diamond retire and enjoy life knowing that downline are quitting the business daily?  Never mind the thought of actually investing into a IRA for the future.   No, the exalted diamond lifestyle is more than likely very ordinary although you can argue that not having a job is awesome. But as my upline diamond once said, what good is your freedom if you don’t have enough money to do anything you want?  That is likely the case for an average diamond.

Why Amway?

I’m actually shocked that the Amway scam is still going on.  That people are still being dazzled with “the dream” and still perpetuating this business with an influx of new recruits.  Not it does seem as if function venues are getting smaller and due to easily available information, people can look into Amway and get enough information to make an informed decision.

But why do Amway in the first place?  The stock market is on an amazing bull run and there are opportunities all over the place.  Anyone willing to work hard and persevere can succeed in the US.  Most Amway recruits seem motivated and willing to work.

But the flaw in many recruits is that that want pixie dust.  In other words they want a short cut to retirement and riches.  Creating wealth takes some time and effort and that is the reality.  Unless you invent some fad or get some kind of lucky break, most people can’t retire until 60 or so.  And that just isn’t sexy.

To Amway recruits, I ask this.  Where are all the Amway retirees?  I know retired fire fighters, police, government employees and banking people but I don’t know any Amway retirees.  Sure, people assume that diamonds are retired and living large but why don’t any of them walk away to enjoy residual wealth?   Instead, diamonds stay on duty until death is so it seems.  That should be serious food for thought fir Amway prospects.  So I ask again.  Why Amway?

How You Get Sucked In?

Amway in conversation or on paper in a plan might seem reasonable, logical and sensible but it’s all in the pitch.  The pitch is carefully designed to suck you in.  They’ll say you make money and save money in Amway.  Who doesn’t desire those things?   It makes sense until you realize that you wind up spending more and losing money in Amway.

It also sounds great that you can possibly get wealthy and live the care feee diamond lifestyle.  But who has really taken a good look behind the scenes of a diamond lifestyle?  Fir all we know, diamonds are in debt portraying a rich lifestyle while they might be riddled with debt.  After all, Americans are generally in debt.  Why would a diamond living an excessive lifestyle be exempt from debt?

Where are all these Amway retirees who wake up at noon and play all day?  Do they exist at all?  The math in my opinion says no.  But I will admit that shining off wealth is a good way to suck people into the business opportunity.  Who doesn’t want early retirement and a care free wealthy life?  Sadly the diamond uses this to entice people into investing in a business where failure is nearly assumed but that failure helps to fuel the diamond illusion.

Are done diamonds possibly wealthy?  Sure, but that doesn’t mean rank and file IBOS will sign up and achieve the same results.  And even if you did, are you willing to sucker people into the business so you can profit?  I can’t fathom doing that to anyone so maybe a lack of conscience is a needed trait  to go diamond?  

Building It Right?

When I was at IBO many years ago, I heard the term “build it right”.  I suppose that means you build your business based on parameters that your upline advised.  My business at the time had the correct parameters and I was edified as a qualified “eagle” which meant I had a certain number of down line attending functions and participating in the tools system.  Basically it seemed that building your business right meant your upline diamond was making tool income off your group.

Thus building your business right is more beneficial to your upline than yourself.  Rank and file IBOS do not get to participate in the payout gif tools, only for product volume.  And even product volume rebates are heavily slanted to upline and not to the IBOS who moved the volume.  It is for these reasons that the vast majority of IBOS wind up with financial losses for  their efforts.

Another piece of food for thought is how diamonds quit, fall out of qualification or resign.  Does that mean these diamonds who teach “build it right” were unable to do do themselves?  Why don’t diamonds walk away from Amway to enjoy residual income fir life?  Is it because they too are unable to build it right?  Why do diamonds seemingly die on the job rather than in quiet retirement surrounded by luxuries?

In my opinion it is because the entire business and teaching systems are just a scam and there is no serious way to just build it right.  It’s why the IBO failure rate is high and why diamonds don’t enjoy luxurious retirements.  The diamond lifestyle that’s portrayed at functions is mostly a dig and pony show.

Stealing Dreams?

Some debates over Amway recently churned up some accusations once again about critics being "dream stealers". I thought I would address this but first I wanted to print the definition of a dream from dictionary.com:

dream  
[dreem] Show IPA noun, verb, dreamed or dreamt, dream⋅ing, adjective 
Use dreams in a Sentence
–noun 
1. a succession of images, thoughts, or emotions passing through the mind during sleep.
2. the sleeping state in which this occurs. 
3. an object seen in a dream. 
4. an involuntary vision occurring to a person when awake. 
5. a vision voluntarily indulged in while awake; daydream; reverie. 
6. an aspiration; goal; aim: A trip to Europe is his dream. 
7. a wild or vain fancy. 
8. something of an unreal beauty, charm, or excellence. 

–verb (used without object) 9. to have a dream. 
10. to indulge in daydreams or reveries: He dreamed about vacation plans when he should have been working. 
11. to think or conceive of something in a very remote way (usually fol. by of): I wouldn't dream of asking them. 

–verb (used with object) 12. to see or imagine in sleep or in a vision. 
13. to imagine as if in a dream; fancy; suppose. 
14. to pass or spend (time) in dreaming (often fol. by away): to dream away the afternoon.

–adjective 15. most desirable; ideal: a dream vacation. 

—Verb phrase
16. dream up, to form in the imagination; devise: They dreamed up the most impossible plan. 

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Based on these definitions, I do not see how it is possible for anyone to steal a dream. This dream stealing verbage is just more upline propaganda designed to get IBOs to shut off their critical thinking skills and to blindly commit themselves to buying more standing orders and function tickets, whose profit goes into the pockets of your beloved upline leaders. It the the upline's concern likely because the upline is selling dreams! Selling unrealistic dreams of retiring and walking the beaches of the world. Dreams that will never come true for the vast majority of IBOs. 

I believe #6 is the most appropriate definition for an IBO. A long term goal. But if an IBO's long term goal is retirement and riches, they should analyze their involvement in the Amway business and determine if that is the appropriate vehicle to achieve their goals. For the vast majority of people, this is not the appropriate vehicle and facts confirm this. It's a matter of whether or not an IBO was told to ignore the facts by his/her upline.

But My Upline Diamond Is Rich!

Serious question for Amway IBOS.  How would you know?  Does your diamond let you see tax returns or bank balances?  Or do you simply assume that the diamond is rich because they are on stage talking big and showing you pictures of nice cars and jones?  I can stand on stage in a suit and do the same thing.  But for some reason, IBOS just blindly believe because we’ll, they want to believe.  They need to believe that 2-5 years of work can result in fabulous wealth and early retirement.

Without the hope that the diamond dream provides, there would be no good reason for anyone to join Amway.  Who would want to peddle household goods at premium prices if not for a big reward as the  end goal.  People wasn’t to believe that they can achieve the same things as the diamond.  I was an IBO at one time and there’s no way I would join if a middle class lifestyle was the goal.  And that’s where the scam is played out by the upline.

Join Amway and felt rich.  A few years of work and dedication will get it done.  I the diamond have the secret to success and achieving diamond but you must subscribe to my system of audios and functions so I can teach you these secrets.  In the meantime the diamond is making his bank from selling audios and function tickets while nearly all down line are losing money because of the cost of the training that does not work.

For the IBOS and prospects who think the upline diamond is rich beyond belief, I ask this question.  How in the world would you know?

Doomed From The Start?

So many people join Amway with high hopes and dreams.  It’s no wonder considering how the recruitment meetings go.  Prospects are filled with delusions of untold wealth and retiring at the age of 29.  They are shown displays of wealth from the diamonds who allegedly live a jet set lifestyle with money just rolling in.

I believe a look at reality would be bad for recruiting new people into Amway so they are shown glimpses of wealth that the diamonds allegedly have obtained from the Amway businesses.  But when you study Amway’s own disclosures, you’ll see that diamonds might make a decent income of perhaps 100 to 200k annually but that is gross income.  Taxes, medical coverage and business expenses likely eat up a lot if a diamond’s income, leaving them in debt like most Americans or perhaps a middle class lifestyle at best.

Again, do the math yourself and it’s hard to reach any other conclusion.  Imagine a family of four with a gross income of $200k.  After taxes, medical coverage, and business expenses, it East to see that they aren’t buying mansions with cash payments.  They likely aren’t even buying a nice car in cash.  Sure, some tenured long time double diamonds might have a nice life but these are the exceptions and not the rule.

If not, why is my former diamond (Harimoti) still only a diamond more than 20 years since I left Amway?  I even heard that he fell back to emerald for a while which raises sustainability questions.

The truth is that most IBOS are doomed from the start.  They peddle average products at premium prices.  They also have negative cash flow because of the inefficient training system.  Just because a few new people manage to achieve higher levels doesn’t change the fact that more than 99% of all IBOS make nothing or lose money, because they are doomed from the start.

Ask Upline?

One of the really weird things I experienced in Amway was this concept of checking upline.  Sure as a newbie your upline will be reasonable and flexible but once you start to get committed to the system, it starts to become cult like in some ways.  Many former IBOS have confirmed this experience and it seems pretty common.  It sounds strange to a passer by but thus really goes on in the world of Amway.

I recall being an up and coming IBO and I was getting accolades and getting some time to spend with the upline diamond. It seemed cool but as I look back I think WTH?  My upline sponsor started to teach about submission to upline and that any life or business decision should first be consulted with up line.  I thought why should I ask permission to buy a new car or to get married as if upline were my parents who were still supporting me or something.

But when I figured out the scam it made sense.  Upline very likely wanted to make sure that you had enough cash flow to buy standing orders and function tickers because that was their livelihood.  If you bought a new car, you might not be able to afford functions.  If you had a child, maybe you couldn’t attend functions.  It’s scary to think that the trusted upline would be so insidious but that because crystal clear to me eventually.

So you see folks, upline might verbally say they care about you and want your success but what they really want is to ensure that their income from standing orders and functions keeps flowing without interruption.  Think about it and do the math.  I can’t see any other reasonable conclusion.