Failure By Design?

 There were some interesting discussion points on my Failure by Design article, so I wanted to write a follow up and point out even more reasons why you are doomed to failure in Amway. As discussed earlier, if most IBOs and prospects do little or nothing, then that's already a more than 50% failure rate. Out of the remaining who apply themselves and try to make an effort to profit, less than 50% of those IBOs will make any money because that's how Amway and most other MLM's are designed.

But what makes Amway even worse? It's the systems such as WWDB, Network 21 or BWW that teach you how to fail. Of course, they will call it "CORE steps" or teaching you hot to be successful but what these steps actually teach you is how to engage a lot of your time in activities that cost you money (business expenses) but there are hardly any activities that produce income. Showing the plan can help your business but even many Amway defenders will claim that there's maybe a 20% sponsorship rate. I personally doubt this because most people wanting to sponsor never do. The other step that can make you money is to retail (sell products) but with Amway's bad reputation plus having generic quality products at premium prices, Amway is a tough sell.

The other "success steps" such as reading books, listening to CDs and attending seminars and meetings are activities that cost you money but bring on no income. And these activities comprise the majority of an IBO's time and resources. Even current IBOs can track their activity and expenses and easily see that I am correct. In the famous 6-4-2 plan, the majority of IBOs only earn 100 PV which gets them a (gross income) bonus of about $10. An IBO listening to CDs, participating in voicemail and books and functions easily exceed $150 a month in business expenses and more if they are hard core dedicated. If you were like me where the large quarterly functions (i.e. Family Reunion or Summer Conference) took a plane ticket to get there, then the expenses were enormous relative to the $10 that many IBOs earn.

The only way an IBO can actually make decent money is to sponsor a lot of downlines, who in turn will absorb the upline's losses and allow for a profit, or to sell products like crazy. But I've never seen or heard of a platinum who achieved that level by retailing Amway products alone. Those who do an open minded and honest price assessment will easily see that Amway products are overpriced. The products are overpriced by design, because those generous Amway bonuses that your diamonds and emeralds receive are included in the price of Amway products. How else can Amway pay those bonuses? The Amway owners aren't billionaires for no reason.

So there you have it. Amway is a business opportunity where the vast majority of those who try, fail. But former Amway IBOs and people who had a brush with Amway shouldn't feel bad. They failed because Amway is designed to make most people fail, in my opinion and I have explained how and why I have formed that opinion. Good luck if you read this and still join hoping to overcome the overwhelming odds.

What Are Your Chances?

  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.  However, to not mention that a significant number of people register as IBOs and do nothing would be deceptive in discussing the overall picture of the Amway business world.

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 paying 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. Sounds easy, but because 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 steps. 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 far 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 1/4 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 And The BBB?

 Over the years, I have seen literally hundreds (if not more) blogs and testimonials about Amway. Most of them decry the pitfalls of being an Amway IBO. Most of the complaints cite the fact that Amway in general has higher prices than comparable retailers and the fact that the system consisting of voicemail, books, cds and seminars ate up any profits the IBO may have made and resulted in net losses for most. One particular Amway apologist bemoans the fact that the internet is full of bad testimonials about Amway. The reason why there are so many negative testimonials about Amway is because over the years, thousands, possibly millions either had a bad experience for the reasons I cited above or personally know of someone who had a bad experience.

Amway defenders will often cite the fact that many IBOs sign up and "do nothing" as their defense to this. But I will easily point out that I haven't seen anyone say they signed up, failed to do anything or order products, quit and started blogging about a bad experience in Amway. These defenders will also compare Amway to the gym where people sign up and "do nothing". Whether true or not, I also do not see people who sign up and "do nothing" complain about not receiving health benefits by simply signing up. It is a very weak defense. Conversely, I have seen numerous accounts of folks like myself who did put in effort, some for many years, who did what upline advised and did not see the financial rewards that is promoted in "the plan".

Amway defenders will then try to justify themselves, saying that the better business bureau (BBB) receives few formal complaints about Amway. I will agree with this. Many IBOs never bother to file formal complaints to the BBB or to Amway because in many, probably most cases, the person who quits and may have had a bad experience, was sponsored into the business. The sponsor was often a friend or family member of the IBO who left the business. Many will simply leave and forget the episode and chalk it up to a learning experience in life. Some will complain but really have to ne venue to voice their remorse about joining. Some of us have found the internet to be quite effective in sharing our experiences and our opinions on why the business did not work. This is what one Amway defender calls the "internet war". What I have pointed out is that critics most often simply point out what the IBOs themselves have done. In many cases, the IBO is his own worst enemy. Afterall, critics didn't deny Amway and Quixtar had a connection, nor did critics make up claims about perfect water, etc.

It would appear that most of the problems has a root in the AMO systems, such as WWDB, BWW, LTD, or N21. Now, not all upline leaders are unethical, but it appears that many are, and new IBOs have no way to identify the good from the bad. It also appears that some of these upline leaders will issue bad advice. Advice that is detrimental to the IBOs, but financially beneficial to themselves, such as telling IBOs to never miss a function, or to buy more cds. In many cases, these unethical uplines do not care about IBO success, their goal is just to move as many support materials as possible, so they can fund their "diamond" lifestyle. Sadly, it is also apparent that the diamond lifestyle may be a facade in some cases. An illusion of wealth portrayed as a recruiting tool.

If you recognize some of these warning signs, ask tough questions of your potential sponsor and visit this or some of the blogs linked to this one for more information.

Nicer People?

 Many IBOs "think" they have become nicer people as a result of their association with other IBOs and because a part of the system they are with advises them to read self-help books and other positive material. The upline may also advise you to skip watching the news because of the "negatives" you see. They are also taught that as a side benefit of the Amway business, that they are nicer people. Of course, many IBOs mistakenly think that they started a business not to make money, but to become "nicer". If dealing with people made you a nice person, that's a nice side benefit but a business exists to make money, not to soften your demeanor.

I certainly agree that some people can benefit from positive books and association with others, but for many, it is not a genuine "nicer" person, but simply a phony persona that is put on in order to recruit potential Amway downlines. That is how my former sponsor appeared to me. Because I had known him for a long time, the "nicer" looked as phony as phony can be. There are many examples of phony niceness that some IBOs profess. Even Amway's biggest defender was apparently called a "cyber bully" by an Amway corporate blogger and some others for making disparaging comments about those with opposing views. Others have resorted to calling people broke or losers simply because they did not agree that Amway was their savior. Seems IBOs are nicer when they are recruiting you but that goes out the window if you don't sign up. Then you become a broke loser.

On this very blog, there are comments, I assume by IBOs, that make implied or subtle threats. Some of these comments are not subtle at all. In fact, in my blogging experience, it is usually the IBOs and Amway defenders that resort to name calling. I suspect that is because the facts are on the side of the Amway critics. For example, it is a fact that most IBOs never make a dime, even if you don't count the ones who "do nothing". If you look at system IBOs, then the vast majority never make enough to pay their voicemail expenses.

Even the coveted diamond level appears to be a facade, especially seeing diamonds quit, resign and simply walk away from the business without the lifelong passive income. A triple diamond's bankruptcy revealed some financials, and it wasn't all that impressive considering the size of his business plus longevity in the business. The "success" appears to be a façade in Amway, just like IBOs who think Amway has made them nicer people.

So IBOs, are you a nicer person? Is it evident by your words and actions? It doesn't appear to be very clear to me.