Math And The Systems?

 Many IBOs and Amway supporters adhere to the idea that their system works. As far as I know, there is zero unbiased evidence that the system works. The system generally consists of a website, voicemail, standing orders and seminars or functions, as well as meetings to show the plan, etc. While Amway supporters will claim that nearly everyone who succeeds is on the system, they won't mention how everyone who succeeds also has hundreds if not thousands of downlines who do not succeed, even with earnest effort in building the business using the system.

Edward O. Thorpe was a math professor at M.I.T. who studied and wrote a theory on Blackjack, and found that it was mathematically possible for a blackjack player to have an edge over the house in a game of blackjack. Casinos scoffed at the theory and said it was just that. A theory with no real life application. Well, Mr. Thorpe started playing small and found that his theory was correct. He was counting cards in blackjack and making consistent money. His book eventually became a best seller. The casinos were ticked off and started kicking out people who were obviously winning and counting cards. Counting cards is not illegal but casinos can refuse to allow a player on their premises. But what casinos did not notice right away, was that their profits were skyrocketing because so many people knew the theory but could not or were not capable of executing the card counting system.

But hey, the system works so everyone should count cards for a living right? After all, it is proven by math that the cards will eventually favor a player and in the long run, you can make huge profits from playing blackjack. Of course not, it is ridiculous for people to think that card counting is a good way to make a buck. Not everyone has the bankroll, the skill, and the patience to succeed in card counting. Most people are better off not even trying this.

In my informed opinion, this card counting system is just like WWDB, BWW, LTD, N21 or other Amway systems. For one thing, card counting is a proven system. The Amway systems are not. But it can be viewed as similar in that very few people can use the system and make it work. Even when hundreds of thousands may try it, very few will succeed in both Amway and card counting. In both "systems", those who do not succeed can lose thousands of dollars. In both systems, doing things right can still result in losses.

In both systems, it is "possible" to succeed, but it is highly unlikely. The vast majority of people simply do not possess the knowledge, skills and abilities to make the systems work for them. You also need some money, some patience, and some luck in order to be a long term success. This article is not about comparing the Amway systems to gambling, it is about a person's ability to make the system work. The difference is that nobody promotes card counting as a good way to make a buck. The same holds true about Amway and their systems. It is not a good system to make money.

The Math?

 It is my observation that people who join Amway usually end up losing money in the end. They may get involved to make a few bucks or because they are mistakenly led to believe that they will become millionaires in Amway in 2-5 years. I know my sponsor convinced me that we would be millionaires in a few years. These folks who recruit new IBOs into Amway are often associated with a "system" such as Worldwide Dreambuilders (WWDB)or Network 21 (N21). These system promoters, often diamonds, may mislead the recruits by showing them pictures of mansions or other luxuries, implying that they attained these goods with their Amway business. In many cases, it is a deception, especially when we know for a fact that some diamond leaders who proclaimed that they only make cash purchases, had their homes foreclosed. Without the hype, I am sure there would be fewer sign ups. But what is the evidence?

It is simple. Amway reports that the average active IBO earns about $200 a month in gross income. This average includes diamonds and other higher end IBOs. I believe if you calculated the median, the average would be much lower.

But what makes IBOs operate at a loss is the system expenses. The system generally consists of voicemail, standing orders, cds, functions, books and other materials. An average business building IBO might spend an average of $250+ a month or so on these expenses. Amway defenders like to decry the amount, but there are couples who would likely spend more and IBOs who must travel by air to functions would spend more. Single IBOs who buy only the minimum might spend a bit less. Some IBOs with abusive uplines might spend much much more than $250 a month on tools. I believe my former sponsor spent easily an average of $1000 a month on average. (I am from Hawaii so the average cost of functions is greater due to long distance travel)

Thus if the average IBO earns $200 a month but the same average IBO spends $250 a month on tools, the average active IBO is losing $50+ a month, with lower level IBOs (i.e. 100 PV) would lose more.

Look at a group of 100 IBOs at 100 PV. (This is just a model). If a 100 business building IBOs average $250 a month on tools, they as a group would expend $25,000 a month on tools and functions. Their volume would be 10,000 PV, or about 30,000 BV. This would generate about $7500 in bonuses per month. Thus this group spent $25,000 to learn and be motivated while the group splits up $7500 a month in bonuses. The platinum would get the lion's share of the bonus but most of the rest of the group will suffer net losses. As the group grows, the bonus may grow, but so will their expenditures on tools. Keep in mind that a group of 100 IBOs spitting up $7500 would be an average of $75 each. It is the diamonds that drive up that average. The math bears it out.

The only way the group can make money as a whole is to avoid participation in the tools altogether and to actually sell products to non IBO customers. The evidence is right here with simple math. The systems do not work because the cost of the system is likely to consume all of the Amway generated bonuses and more. I gladly challenge anyone to explain in detail how this post is not reflective of the reality of being in Amway and a system such as WWDB or Network21.

The facts speak for themselves.

The Road To Riches?

 When I saw the Amway plan, it was presented sort of as a road to riches. Yes, the presenter was careful not to say it was "get rich quick", but 2-5 years is relatively quick when compared with working 40 hours a week for 40 years as the business plan was shown to us. And while some exceptional people do achieve diamond, there is a massive trail of IBOs who suffer losses, some of them staggering. In our own group, I know of at least one couple who lost their home following upline advice, and another couple to ended up filing for chapter 7 bankruptcy. I must state that the bad advice leading to bankruptcy and foreclosure most likely came from upline leaders. I also know of a gal who quit her job to attend a function, faithfully following upline advice from WWDB. It took her a while to recover from that bad advice. 

So, what is the experience of many CORE IBOs? I'm not talking about those who "do nothing", but IBOs who actually make an effort. Well, if they do their 100 PV, then they are spending about $300 a month on Amway stuff and dedicated IBOs will typically spend about $200 a month or more on average for tools. This is for a single person. A couple or family would be expected to do more, thus spend more. So, for these 100 PV IBOs, they will expend about $500 a month or more and get back maybe $10. Of course, if they were not in Amway, they would still have some expenses for household goods, but not anywhere near $500 a month. 

Over the course of a few years, these expenses add up and can become staggering losses. Hard core IBOs might expend even more. The only way a rank-and-file IBO can gain relief is to sell products (which is difficult given the prices and the Amway name reputation) or to sponsor downline who wil then suffer some of the losses for you. It would be my estimate that an IBO might break even at about the 4000 PV level. However, at 4000 PV, you might have significant expenses associated with running a group, such as showing distance plans for your group.  

Over the years, I would suspect that millions of IBOs have come and gone through the Amway opportunity and probably lost billions of dollars. But many of those who lose money think they are successful, because many upline will edify those who buy tools, regardless of IBO results. After a few months, if your group and PV are not growing consistently, it is highly unlikely that you are headed for success. 

IBOs and newbies, are you on the road to riches or financial disaster? Keep in mind that a net loss is not success, despite what you upline mentor may tell you.

Amway Or A Job?

 I recall many meetings and functions where the diamonds talked about how your job was making you "just over broke" or "jackass of the boss". They tried to put down jobs, as if working a job were some kind of cruel punishment for the masses. In reality, IBOs could not feed their families, pay their bills and they could not make the diamonds rich without their jobs. I remember seeing videos of people shooting their alarm clocks or a limousine pulling up to someone's place of employment and whisking off someone who recently went diamond or reaching some other pin level.

I suppose that for someone young, who may be in their 20's or 30's, the prospect of working another 30 years seems like a daunting task, thus a "shortcut" such as working 2-5 years sounds like a good alternative. It makes sense, until you actually start trying to build the business and find the name reputation and products difficult to sell. At some point, your investment into standing orders and functions starts to add up. You start to wonder if you made a mistake in trying to find a shortcut to financial freedom. You start to wonder if financial freedom even exists in the Ama-world. Why are the diamonds still working? Why don't any of them "walk away" and collect residual income for life while walking on the beaches of the world?

Luckily, you did not quit your job. While your current job may not equip you with financial freedom, you are likely able to pay your bills and put food on your dinner table. That is more than most people can say about the income they receive from Amway. I used to wonder how much money these diamonds actually make. While they may earn a nice income (if they are actually qualified), a diamond lifestyle can render them even more broke and in debt than the people they recruit into Amway. I believe many diamonds are living month to month, worrying about their finances because they portray a lifestyle that cannot be sustained on the kinds of incomes that Amway reports (i.e. $147,000 average diamond income). A recent triple diamond in bankrupt proceedings revealed that while they earn a nice income, they may not be able to sustain an excessive lifestyle, and certainly not without making a significant income from selling functions and other tools to downline.

Rather than getting excited about seeing a Mercedes Benz, ask your diamond how much they earn from Amway. Ask them why there aren't any diamonds taking advantage of residual income for life, thus walking away from the Amway business? While working a job and saving money may not sound that attractive, it is still a much better alternative than working a job while channeling your income into standing orders, voicemail and functions that do nothing except make your bank account lighter. Financial security and long term sustainability takes hard work and discipline. Many who promote Amway trick prospects into thinking that Amway is a shortcut to get rich. It isn't, save for the owners of Amway and a few old time Diamonds who control the systems. The facts are there, you just need top recognize them.

No Debt?

 One thing that many Amway/WWDB IBOs tout is how their upline teaches them to get out of debt. While on the surface that sounds like an awesome thing to do, it's not what WWDB mentors are actually doing. They want to give the appearance that they have your best interest in mind and that they want you to succeed. At least that's what they want you to think. Sadly, many IBOs get sucked into believing this. I will go on to explain why this is and to give prospects and information seekers some food for thought.

If you have an open mind, you will see my point. Prior to someone joining Amway, they most likely didn't buy any Amway products and certainly didn't focus on spending about $200 to $300 monthly on buying household products, especially if they are single people. So how is buying more stuff than you used to, supposed to help you get out of debt? All you are really doing is sacrificing things you used to enjoy to spend on Amway stuff. If you actually made a net profit from your Amway business, that might be okay. But most IBOs are making nothing or losing money while being taught to never quit or that success is right around the corner.

If your upline or mentor is teaching you to get out of debt, are they also advising you to invest any "extra" money into investments? Are they teaching you to plan for the future, in case the Amway business doesn't pan out? Are they advising you to save money? More than likely, the answer is "no".

Your upline will be advising you to use any money you have available to invest in tools and functions. WWDB premiere club, download audios (at a charge), standing orders book of the month and attend all functions. You will be advised to do this even if your business has not made a cent in profit. But you say your sponsor or upline loans you tools and pays for your functions? That might be true, but guess what? Once you sponsor someone, you will be the one loaning tools (that you paid for) and/or paying for your downline's functions because with a downline, you are now a "real business owner". It's amazing how so many people get fools into believing that upline wants you out of debt for your own good. Upline wants to out of debt for upline's good. For that reason, you might be told to get to the next big function at any cost, no matter what. That your business will be set back months or years if you miss it. The reality is missing a big function might be your wisest financial decision.

Your upline may want you out of debt, but they more than likely have their own interest at heart and not yours. Look at it objectively and ask your trusted friends who are not in Amway what they believe. This is advice from someone who has no reason to lead anyone astray. I experienced this and fell for the trick as a young and hopeful dreamer. Now I am hopeful that my experience can prevent others from falling into the trap that I fell into.

Upline Wants My Success?

 One of the biggest loads of garbage that upline diamonds often tell their groups is that they really want success for their downline IBOs.  It's clear and obvious to me is that your upline diamond doesn't give a rat's furry ass about your success as long as you are buying tools and attending functions. Your dedication is money in the bank for the upline diamonds. They will tell you that you are a warrior or a fighter to make you feel good, but behind the scenes, they could care less.  The diamonds peddle hope and hype without substance in my opinion.

Now I believe your sponsor probably does care a little about you succeeding, but technically, your sponsor is supposed to train and motivate you free of cost, which is why your sponsor can benefit if you purchase or move enough volume. The problem with this is that your sponsor is also very likely to be immersed in the tools system which takes away income from his/her business to feed the upline diamond.    They probably want you to "succeed" just enough so that you don't quit.  That's why you might be told that you're a success if you alone, attended a function.

If you take a good look, you will see that the advice given from stage at functions or big meetings are so generic that it usually does not apply to you as a person and if so generic, then you can get that same advice on an MP3 or a cd.  Yet, the diamonds expect IBOs to attend major functions every three months. I suppose to supplement their Amway income. These diamonds are not mentors. They don't analyze individual businesses and your personal skills. How can they guide you in this type of business without knowing these details? They can't.

Think about it. Your upline wants your success or do they want your money? Practically anytime you receive "help", it costs you. Open meetings, attitude sessions, functions. Every one of these has a cost of time and money with no direct cause and effect of people succeeding and receiving the mythical residual income. If your upline says this, ask how they can assure that it happens, aside from a dedication to functions and tools. 

Food for thought. If you actually went diamond, your leaders would get less tool money. Do they really want your success or are they just saying it?

Behind The Curtain?

 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, yets, 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.  The love of money, but money by itself as money is inanimate.  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.