One of the really funny things that is taught to IBOs is how they need to ditch the employee mentality and convert to a business owner mentality. Those who truly have a business mentality are unlikely to join Amway the systems because the return on investment wouldn't be worth it. When you also consider that only a small fraction of 1% make any significant money in Amway, it's hard to imagine that any reasonable and logical person would want to divert time, money and effort into a venture where your likelihood of succeeding and making money is so small.
When you really stop and think about it, many IBOs have an employee mentality but they think they are thinking like business owners because upline tells them so. The relationship between upline and downline is often just like that of a supervisor and employee. The upline tells you what to do and the downline, who is usually less experienced, simply listens and follows their instructions. If an IBO were to do things on their own, it would be considered as de-edifying to upline who has already blazed the trail for you. They have what many refer to as the "system" consisting of cds, books, voicemail and functions. Many refer to the system as "CORE" steps.Basically, the CCRE steps is the "job" of the IBO. They need to immerse themselves in the system, and then they need to show the plan to others and get others to follow them. The really sad thing is that many IBOs do exactly as they are told or advised, and never see a cent of profit, and more often than not, end up losing money despite their efforts and expenses. It's like going to work, and giving your boss $300 so you can get a $10 paycheck at the end of the month. While Amway loyalists will disagree, this scenario is the most common and most likely. All you have to do is take a look at the 6-4-2 or whatever plan they show you. The lowest level IBOs will spend about $300 to purchase their 100 PV and then they get back about $10 at the end of the month. Most IBOs never sponsor downline so their volume never grows unless they consume more themselves. Most IBOs, even dedicated ones, can never sell enough products to cover their expenses. Faced with these obvious facts, anyone can see why you are almost guaranteed failure in Amway with the system.
If IBOs truly had a business mentality, they would be focused on selling products and not desperately trying to sponsor downline. They would also focus on minimizing expenses. But most business building IBOs are selling the opportunity and a dream, which is why some critics claim that the Amway opportunity, lacking a focus on retail sales, is crossing into the parameters of the law. Those who focus on "buy from yourself" without outside sales are the worst offenders in my opinion. If you have an employee mentality, then it's likely you will listen to what your upline says and do your "CORE" duties. What kind of mentality do you have?
Anyone with a real business mentality has two goals in mind: immediate profit, followed by sustained profit.
ReplyDeleteWhat that means is this: you sell your merchandise at a markup that covers your overhead, and that leaves something significant for you to take home or bank. And then you make sure that you maintain this level of profitability on a regular basis, and perhaps extend it by improvements in product quality, or through advertising.
That's it. That's the central heart-throb of the business mentality. Under no circumstances would you want to "recruit" somebody into the business to be your potential competition!
Places where there are many Amway IBOs are filled with resentment and nastiness. I have heard some IBOs speak with utter hatred for some other cross-line IBO in town who has recruited new down-line that they didn't get. There's fury when somebody else gets a pin, and they don't. And Amway spouts the outrageous lie that "We're all close friends in this organization!"
Yeah, sure.
Spot on blog! Another area where the employee mentality with regard to their Amway involvement shines through, is how defenders respond to skepticism about the business. They often do so by singing the Amway corporation's praises.
ReplyDeleteFor example, they'd cite the good customer service rating with the BBB, or the fact it has existed since 1958, or the fact that Amway sponsor's sports teams or other social responsibilities, or how good entrepreneurs the founders turned out to be. None of these are particularly relevant in whether it is sensible to try and earn a profit peddling their products or to earn secondary commissions on others you referred.
For the BBB in particular, it is pretended as if the rating is an endorsement of the business opportunity, while in fact the BBB's evaluation which is on customer service. The BBB does not say, or purport to say, anything about the business opportunity at hand, it's outcomes, risks one can expect as a business owner peddling their products (or opportunities). The BBB tells you what you can expect from the businesses they evaluate, as a customer. Whether they register and resolve complains, and whether they honor their return policies. Therefore, perhaps in this case, it is not even employee mentality, as much as customer mentality.
Coca-Cola is also a solid company, and they've been around for longer than Amway. That has little to do with whether it is advisable to open another soft drink stand in a park near you. And I dare to say the success rate of soft drink and snack stands in parks making some profit in the first year, is almost certainly more than 1%. So much for the Amway opportunity being "tried in tested" and being easy and cheap to get off the ground. I'm pretty sure a snack stand wins on all of those. But I digress..
A bank loan officer or co-investor is not going to be interested in how wonderful Coca-Cola or Amway or whichever other products are. Their question will be the prospects of the business you are opening, demand in the area, realistic first year revenue and running cost projections (and how it transpires in the first few weeks), competition in the area, and perhaps the average of other ventures in the area. All things people with business mentality should be interested in. All things Amway business builders are told to shut their ears to, branding anybody that alludes to those as negative naysayers.
Lastly, I own a small (real) business, that's been going for over 10 years now. I really don't go around obsessing about others stuck in "employee mentality" or that they work for a boss. My last job is where I honed many of my skills (studies also helped!), and as such I have enormous respect for my ex boss. I don't obsess that my wife, for example, should quit her job and source her own customers. I have no urge to look down on my customer contacts (who are employees, and some of whom have far bigger net worth than I do) nor ex colleagues, nor to lecture them that they are making their bosses rich. It would be silly. Far more important is how my business is doing right now, and whether the odd investments I have made ended up paying for themselves more than once.
Ironically, I too was accused from having "employee mentality" for enquiring about numbers. The logic went something along the lines of employees expect a pay cheque, whereas those with business mentality know they can't predict, and they do work now that pay off later (the I'm still counting excuse). This is nonsense, in business there is uncertainty, but an easy to start business should have realized income after a few months, it would keep an eye on books all the time, and it would be able to make reasonable running projections for the short and medium term, backed by recent results. And it would absolutely share how things are going if it is in the interest of growing the business!
kwaaikat, great analysis and comments! Thanks for dropping by to give your valuable insight into the Amway business opportunity.
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