One of the things that keeps some Amway IBOs going is the "hard reality". What I mean by that is for some IBOs, once you have been in Amway for a while, it can be hard to quit. You were possibly recruited with dreams of lifelong residual income and walking on all of the exotic beaches of the world. Retiring young and spending that time with your wife and family, and Amway friends. To quit means an IBO would have to face the reality that these dreams will not come true, at least not with the Amway business. The fact is that the Amway opportunity probably would not have delivered those dreams anyway. Even a diamond more than likely cannot afford those dreams. In fact, I would estimate that most diamonds, if they flaunt some excessive lifestyle, are near broke or in heavy debt as a diamond income cannot sustain a jet set lifestyle, save for a founder's double diamond or something similar. I believe the prominent WWDB triple diamond bankruptcy (in 2009 - WWDB Diamond) shed a lot of light into the finances of an upper-level pin and it wasn't as impressive as I would have thought.
The triple diamond who filed for chapter 7 bankruptcy made about half a million dollars annually from Amway. That's a great income and more than most people earn, but seriously, a half million dollars income is not going to allow you to buy mansions paid for in cash, or a fleet of sports cars. After paying taxes and business expenses, I'm not even sure someone with that kind of income even lives a worry free life of leisure. And we're talking about a triple diamond, not your average run of the mill regular diamonds who I would safely assume, earns much less than a triple diamond.But what really is the hard reality? It's working hard only to drift between 100 and 500 PV. It's finally sponsoring a new IBO only to have a downline quit. It's talking to people about Amway and getting laughed at or getting rejected. It's your upline or sponsor pushing you to do more. Possibly your upline is one who questions your manhood if you aren't working hard enough. It's your upline or sponsor reminding you that a winner doesn't miss functions, especially the major ones. It's staying up late for team meetings or night owls when you need a good night's rest to do your job the next day. It's driving the miles to show a plan, only to have your prospect not show up. It's having to be deceptive about what you are doing. It's skipping functions with family and friends so you can be "core" to the Amway business.
As IBOs, do you see any of this? I saw some of this during my involvement. While I have not been an IBO in some years now, I still see many testimonies and comments by more current and even some active IBOs to indicate that a lot of this still goes on. While Amway defenders will deny it, I see no reason why any of this would have changed over the years since Amway has made no significant changes to stop abusive uplines. If Amway did make any changes, they are not immediately apparent, and the continuous string of comments and testimonies do not confirm that any clean-up has been done.
For active IBOs or prospects, these are the hard realities that may be attached with the Amway opportunity. Much of it is because of motivational groups such as WWDB, but if you are seeing these traits in your group, ask the tough questions. If you happen to decide that the Amway opportunity is not for you, take heart! There are other ways to achieve your financial goals and dreams and there are more efficient ways out there. Sometimes, quitting something that isn't working is often a wise business decision, and sometimes you can lose more by not quitting. Good luck in whatever you decide.
2 comments:
What you are describing is known in studies of how humans mistakenly rationalize poor decisions, as the "sunk cost fallacy". There are many sources on that for those who want to research it, basically it comes down people being unwilling to cut their losses, not because of the outlook which looks increasingly dire, but because they've put so much into it. It is easier to grasp onto a vanishing straw of hope, than to admit it was a poor decision, that the time and money should be seen as water under the bridge.
It may be initially difficult making that adjustment, a bit like escaping an addiction, it means cutting your losses, admitting the hard truth, getting used to the idea that Amway is never going to make you rich. But it is the wise mature and yes, business thing to do. There is no shame in quitting a business venture or investment that didn't deliver, that turned out to be a poor decision. Even Warren Buffet once said "Should you find yourself in a chronically leaking boat, energy devoted to changing vessels is likely to be more productive than energy devoted to patching leaks". What is a shame is every additional day spending time, energy and money flogging a dead horse, one that is clearly dead. If that is the case, of course the best time to quit would have been right at the start. But the second best time to quit is now.
Most of those facing this dilemma after months or years would already have seen, the low startup costs business opportunity never was that. After much investment in time and money, if participants are still talking about tax write offs (if a business is successful you pay MORE tax!!!) and "learning a lot", that should be the cue. MLMers love to point to Warren Buffet because he allegedly invested in MLM (as in the product supplying the companies, like the equivalent of having shares in the Amway corporation) as if it is an endorsement of being a distributor. They would do well to research in what his investments actually were, the supplier, or being an actual netework marketer (spoiler, it's the former). And to heed what he said about the virtues of cutting your losses and quitting and the foolishness of pinning hopes on what for the investor, has turned out to be a chronically sinking boat.
kwaiaikat, as usual, great analysis!
Yes, the sunken cost fallacy applies here. But a part of the whole picture is how people who quit are labeled as losers or quitters. That subtle peer pressure helps to keep people involved. That and the possibility that success might be right around the corner and you don't want to quit just before the business takes off like a rocket.
The sad reality is that hanging in there longer just results in more losses for the IBO, and more profits for upline. That's why they can't have you quitting. Regular dedicated IBOs are their primary source of income.
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