The Product Pyramid?

 Let me start out by saying that Amway is a very likely a perfectly legal company, and therefore I am not saying or implying that Amway is illegal. But I believe however, that the way Amway businesses are run, are like pyramids. In most groups, you will have the lowest level IBOs efforts and tool purchases being responsible for the upline bonuses and tools income. Many IBOs are fooled into thinking that the ability to surpass your upline or that you don't get paid to recruit downline makes this a good deal. This doesn't change the fact that the vast majority of IBOs lose money. The lottery is legal in most states, but I'd say it's not a good investment for your money.

Unless you have a very rare group where actual product sales to non-IBOs are sufficient to cover the costs of running your business, functions and all, then it is true that the lower level IBO's jobs are likely the source of income for the uplines. How many groups are like that? None that I have ever seen or know of. In fact, how often do IBOs even sell enough products to cover their expenses for even one month out of the year? The groups that teach "buy from yourself" end up doing the most financial damage to their groups because the downline's expenses are then covered exclusively from the downlines jobs, bank accounts, or drive the downline into debt.

I've seen and discussed group structures in forums many times and I can only conclude that tool sales wipe out what little profits/bonuses some of the downlines might receive. Only when an IBO is able to sponsor enough downline to absorb the losses for them will they finally break even or make a little profit. I would guess that the 4000 PV level or platinum is where a dedicated CORE IBO would just about break even and possibly start to make a real profit. But if you are hard core dedicated, you can still lose money at these levels. We also know that most platinum groups have 100 or more IBOs in order to generate 7500 PV. Thus, we can also conclude that less than 1% of IBOs make a net profit. The only way IBOs can earn a net profit at a lower level is to avoid purchasing tools and to avoid paying for functions. Those who get involved in a system such as WWDB or N21 almost guarantee that they will have a net loss because of the expenses associated with these systems.

Sure, my job may have a pyramid structure with the CEO making the most money. But the difference is that in a company, even the lowest paid employee still receives a paycheck and has money at the end of the month. The same claim cannot be made by IBOs. For these reasons, I believe Amway to be a legal pyramid, where money flows from downline to the upline. IBOs and information seekers are free to participate, but I challenge them to sit down and really analyze their ability to make a net profit. In most cases, the analysis won't be favorable. If you are in the US in particular, you may have great difficulty in even being able to discuss "Amway" without getting strange looks your way from others. Do you have to shy away from using the name Amway? Do you have to use the curiosity approach? If you do, ask yourself why. The answer is obvious.

Defenders And Critics?

 Ever since the "tools scam" in Amway was exposed by the internet and further confirmed by Dateline and previously by 60 Minutes in expose's, there has been a sort of "internet war" between Amway critics and defenders. The defender's mantra is almost always "we don't do that", which I find ironic, because often, these same defenders admit they are from the more abusive of the lines of sponsorship. While I admit there may be some "rogue" IBOs who focus on selling product, they are the rare exception and not the rule. Most IBOs belong to an LOS who sells tools such as cds, voicemail, seminars/function and other support materials. In the past, uplines lied and denied that they made any tools profits. Now that the lie has been exposed, the IBOs seemingly have just forgotten about this and gave upline a free pass while uplines continue to display a lack of transparency about the tools business.

I will also acknowledge that Amway may have tried to make some changes to clean up some of the abuse, but at the same time, many of the changes appear to be cosmetic and meaningful changes are not apparent. Take accreditation for example, what did it truly accomplish? Not much in my opinion.

The most hard-core defenders of Amway act like internet trolls at times, setting up alerts and dropping uninvited into conversations whenever the word Amway comes up. The weaker defenders of Amway will drop into a conversation and will disappear in a flash once they get schooled by the facts. One good example was someone denying that diamonds spoke about buying homes in cash. When other commentators confirmed hearing this claim, the Amway defender tucked tail and ran. The more elusive defenders of Amway will try to get a critic to defend an extreme position, or will try to say that critics paint too broad of a picture. For example, when you say upline, why refer to all upline. A valid point, but when making a defense, these same defenders will paint all of the upline as "rosy" by saying things like "we" don't do that, implying that not a single person in the LOS does that, which is almost always false.

But the most important thing that information seekers should note is that Amway defenders have something to gain by defending Amway. Amway defenders may have something to gain and may even lie and cheat to make Amway look good. Some diamonds in the past even made ridiculous claims just to sell their "perfect" water product. Amway critics have nothing to gain. Some of us do this only because there are many injustices placed upon the masses of downline, and not only did the upline get away with past offenses, many of them continue their practice of bilking their downline for personal benefits.

Those are the differences between Amway critics and defenders.

Behind The Scenes?

 One of the things that the Amway Diamonds and some other leaders do to attract new IBOs is to put on a dog and pony show. They want prospects to think that you can consume Amway products and get others to follow your lead and, in a few years, you will be set for life financially, speaking on stages and securing the future for generations to come. They might use props such as pictures of mansion. slideshows of cars, jets, yachts. It looks impressive but based on what I know now, who knows whether the diamonds actually own this stuff or if they are simply showing you a slideshow of "lifestyles of the rich and famous". The reality is very likely that many diamonds are actually living in debt or bonus check to bonus check. It is a fact that more than half of NBA basketball pros end up broke less than 5 years after they retire, and they earn tons more cash than diamonds. Why would a diamond be different than the average Joe, especially when they appear to live beyond their means?

In the few cases where diamond income was exposed, we can see that they were not making the kind of money they would have you believe.  A Triple diamond (documented) was making about half a million a year from Amway. A nice income for sure, but not what people would think, and not enough to save that diamond from chapter 7 bankruptcy. Another WWDB diamond apparently lost a home to foreclosure. Another diamond, unnamed but documented in the book "Amway Motivational Organizations, Behind the Smoke and Mirrors", talks about a diamond who had a gross income of over 3 million dollars, and a net of about $320,000. This diamond was in debt, had back taxes owed to the government, and was working hard to portray the diamond lifestyle while living in serious debt.

Some of these leaders also use religion or Christianity as a means to justify their involvement in the business. For those who know, the Bible is clear that the love of money can lead to destruction. When you have functions, such as Dream Night, what does that say? I would also like to note that in cases where these diamond's financials were exposed, there were no significant contributions to charity. I wonder if these charlatans talk a good game but do not contribute time or money to worthy causes? Where are the ten thousand dollar checks they talk about donating to charity? These leaders often refer to themselves as mentors, but any help they provide to downline results in some kind of compensation for them. This is not a mentor, but more like a paid consultant who is not getting effective results.  

Behind the nice suits and the glitz of the functions, I believe that IBOs and prospects would see a world they truly would not want to be a part of. A world where deceit is practically needed to succeed. Where you take advantage of people who trust in you. Where you pretend to be wealthy and free, but in reality, a slave to the mighty dollar. Where you traded a 9-5 job for a job that works the graveyard shift. If you look objectively behind the scenes, you might see what I see.

Business Expenses?

 Many Amway uplines will use deceptive recruitment tactics when getting new people to see or register into the Amway business. One of the common things was how joining Amway has very little risk, none or very little overhead. This is true, if an IBO is not involved in any of the system related training. However, it is the goal of many if not most uplines to get as many IBOs involved in the system as possible. This is probably because selling standing orders, voicemails and seminars has a higher profit margin for uplines than the actual movement of Amway product volume. So some newbies might join thinking Amway won't cost them much, only to find out that 100 PV might run them more than $300. They may not be aware that standing orders and functions never end and can add an additional cost of up to several hundreds of dollars more each and every month with no end. Uplines will then justify the expense by saying the IBO is investing in his/her business.

New IBOs, and especially IBOs who are single should seriously think about the cost of being a business building IBO before joining. Many or most prospects don't know that building an Amway business using system tools and "coaching" can cost them up to $500 or more each month. A single person more than likely cannot possibly consume 100 PV worth or products on a monthly basis unless they almost exclusively consume XS drinks and Nutrilite vitamins. And secondly, how many singles or prospects were consuming cases of energy drinks and vitamins ($300 monthly) before being presented with the Amway business? How many people were willing to fork out hundreds of dollars for a weekend function that may require airfare and hotel stay? I don't think too many people like this exist. But I believe they do so because they have been sold a dream of financial freedom, of early retirement and not having to work a job anymore. But the evidence would suggest that once the dream disappears or reality sets in, how many (former) IBOs continue to purchase Amway products and attend seminars?

I know of many former IBOs and I don't know of any who purchase Amway products on a regular basis, and I don't know of ANYONE who has ever forked out money to attend an Amway/AMO function after they stopped being an IBO. Amway's numbers bear out this claim as there is very little sales to people who are not IBOs. The IBO salesforce is responsible for consuming the lion's share of Amway's products and services. I myself have purchased an Amway product or two since I left the business. But I did so only to humor friends who were still in the business. They have all since quit. It is very reasonable to conclude that once the desire to build the business stops, the desire to purchase Amway products also stops.

Most eager young and motivated people who sign up often do not realize that these IBO expenses exist. While Amway acknowledges that these tools and systems expenses are optional, the uplines who promote the tools may suggest that it is insanity to attempt to build an Amway business without the tools or strongly encourage new IBOs to partake. A common statement was that we "needed" to be at the next function no matter what. Missing it would set your business back six months. New IBOs and prospects don't know better so they will often conform. Sadly, there is ZERO unbiased evidence that the tools and seminars do anything to increase IBO volume and/or the sponsorship rate. In my informed and experienced opinion, the tools are ineffective and the vast majority if IBOs would be better off handing their upline a monthly check for $100 and not building the business or buying any products.

IBOs and information seekers should be aware of these potential IBO expenses and determine if the expenses would be worth your while. Keep in mind that someone upline profits handsomely from the tools, even if you do not make a cent from your Amway business. You should have your best interest at heart, no matter what your upline tells you.

No PV For Your Efforts?

 One of the things our Amway upline constantly taught us was there is no PV (point volume) in TV. They advised the group to avoid Television, the newspapers, and other forms of media. This cult-like tactic was apparently their way of having us avoid any negatives that could affect our thinking. But it renders obedient IBOs as apathetic. As if IBOs didn't need to learn of any news. IBOs don't need to learn about any issues, after all, your upline will tell you what to do and how to vote, and how to think. Looking back, you have to wonder how in the world your upline would know what was going on in the world if they were following their own advice?  The answer is obvious if you're no sucked into the vortex of the IBO's world of Amway and the sub systems such as Network 21, WWDB, or BWW.

It is true that there's no gain in PV for watching the television, but then again, IBOs engage in many activities that doesn't result in gaining PV. Attending a function or listening to a standing order doesn't get you any PV either. Hanging out with your upline or attending a night owl doesn't get you PV. If PV was the priority of IBOs, they should be pounding pavement selling products or making contacts with potential buyers. Instead, some groups teach that selling is not required or the famous "buy from yourself" technique of running a business. When you sit down and think about it, at least television isn't as costly as attending a function or listening to a standing order, even if you don't get PV for it.

In fact, IBOs spend so much time in non-income producing activities, it's no wonder that the vast majority IBOs end up with a net loss after business expenses are considered. What's worse, IBOs run their businesses on the internet but in most cases, it's against Amway rules to advertise their products on websites such as ebay or craigslist. Instead, IBOs employ the least efficient means of working their business. Person to person, one person at a time. For many, the only way to increase PV volume is to sponsor downline. Even many IBOs who emphasize selling, seem to rarely have more than a handful of regular customers. But what can you expect when your means of increasing business is person to person, one at a time? There's a reason why advertising during the super bowl has a heavy price, because tens or hundreds of millions of people see your message all at the same time. IBOs go person to person, one at a time.

If upline were sincere and accumulating PV was a priority, then why isn't selling product emphasized all the time?   The truth of the matter, in my opinion, is that PV is only important for diamonds to keep their qualifications and the rest of the emphasis is on the consumption or cds/audios, books, functions and other materials that are big profit centers for your upline leaders.  Let that marinate and sink in for a few minutes.  

The Truth?

 One of the silly things many Amway IBOs are taught is to avoid negative. I believe this is taught today by uplines and it was certainly a point of emphasis even in my days as an IBO. The upline diamond would say that the world of full of negatives and that we as people take in too much of these negatives. Therefore, the IBOs were told to avoid television, newspapers and other forms of communication with the outside world. The group was also told to avoid people who speak negatively about Amway. For this reason, many people have considered Amway groups such as WWDB or N21 as cultish or cult-like. (information deprivation or information control).

I can agree that you surely don't want to only take in negatives as it can wear you down, but not seeing the news or reading about current events in the paper simply makes you apathetic and uninformed. For example, wouldn't you want and need to know if there was a storm heading your way? I live in Hawaii and we occasionally have hurricanes. Avoiding news could be very detrimental to your family and home. If you lived in the mid west of the US, wouldn't you want and need to know if a tornado was headed your way? Do you avoid the doctor because his assessment of your health might not be "positive"? For these reasons, I believe that many Amwayers walk around wearing a mask with a false smile, trying to appear overly positive.

Another important thing that many IBOs cannot distinguish is the difference between negative and the truth. If your wife asks you if her new dress makes her look fat, the truth might be that the new dress indeed makes her appear fat. That answer may be uncomfortable for you to deliver, but the truth is the truth. The truth at times can be positive or negative but it is still the truth.

Most IBOs earn less than $100 a month. That is the truth. Most IBOs lose money if they participate in functions and standing orders and such. That is the truth. Most IBOs will never even sponsor a downline. That is the truth. Most IBOs, filled with motivation and dreams, will never see those dreams fulfilled. That is the truth. Many upline diamonds, who advise IBOs to purchase tools and attend functions, and fill the IBO's heads full of dreams, make significant incomes from the sale of tools and functions. That is also the truth. In a 1 year time span, approximately 50% of IBOs will quit in the first year. That is the truth.

Is it negative to tell the truth? Or can IBOs not handle the truth?

The Real Cost?

 One of the common things Amway leaders apparently do is to disparage people with jobs. Oh, they would say we needed people to wait on our tables and clean our toilets, but in general, jobs were put down and basically the group was told that Amway is their best chance at achieving financial freedom, giving them the ability to flush their jobs. Ironically, IBO's jobs are what funds their Amway businesses. Most IBOs would be out of business within weeks if not for their job income funding their Amway businesses.

The key selling point appears to be the 2-5 years of part time work rather than working a job for 30 - 40 years and then retiring on social security which may or may not be there when you retire. This plants a fear in people about the future and then the Amway opportunity is presented in a positive light because the Amway opportunity comes with a low start up cost. What uplines do not mention is how the opportunity can become a money pit as the monthly defacto 100 PV quota starts to add up. It is my guess that if people only bought items they truly needed, these IBOs would likely move 100 PV every three months, unless they are actively selling goods to non IBO customers. With Amway products being so concentrated and efficient as IBOs claim, why would you need to replenish these products so often?

When an IBO finally agrees to register, it is then that the true, but hidden costs are revealed. Many uplines will introduce standing orders and functions and present these tools as vital to IBO success. Most new IBOs don't know better and feel subtle pressure to conform and give it a try. Some upline may loan some tools to downline in the beginning but eventually, the IBO will be encouraged to be a "serious" business owner who should be purchasing their own tools to loan to their downline and the cycle goes on. There is also the cost of additional cds, books, voicemail and other business related costs that are not mentioned until later which the prospect doesn't necessarily know prior to start up.

If you examine some version of the Amway recruitment plan, you will see that most IBOs are at the 100 PV level, which will reward you with a monthly bonus of about $10 or so. If that same IBO subscribes to the tools system, than IBO will likely be losing over $100 to $250 a month not including the cost of the product purchases. And because many IBOs have been convinced that working a job is so horrible, that they can be convinced that this condition of losing money is temporary and that untold wealth is right around the corner. Sadly, for most, this condition is the norm and even the sponsorship of a few downline, the losses continue to mount. Yet many are convinced that this is better than a job. And this is just the financial cost, not the time and effort spent pursuing a false hope and dream that Amway IBOs and recruiters promote.

Ironically, a job allows people to pay their monthly bills, feed their families and many people enjoy their work and co workers. While upline leaders may convince you otherwise, it is this very same excuse upline leaders use when asked why they are still working instead of walking the beaches of the world collecting massive amounts of residual income. I would encourage IBOs to truly analyze their efforts in Amway and determine if it is beneficial to your finances. In most cases, your Amway efforts ONLY benefits your upline's finances. For most who get involved, the Amway opportunity is not better than a job.