Many people pitch Amway as an easy, and somewhat shortcut to riches. It's all over the internet, it's what I saw as an IBO, and I have good reason to believe that many still pitch Amway in this manner. I believe that people want to believe that you can create wealth part time in 2-5 years. IBOs and prospects may be told "it's not get rich quick", but 2-5 years to quit your job and live off residual income sure sounds like the pitch of a get rich quick scam. It is what has contributed to Amway's current reputation.
A typical IBO (not counting those who do nothing), according to the "plan" will consume and possibly sell some goods on their way to 100 PV, which will earn them about a $10 bonus from Amway. There might be some profit from sales to customers, but there are also expenses involved in running a business. If an IBO is on the system, then their expenses might run from $100 or so to $500 a month, depending on level of commitment (brainwashing). In the end, a falwed system and generally non competitive pricing and products leads to most IBOs eventually quitting. The vast majority of IBOs on the system will wind up with a net loss, even with a tremendous amount of effort. Seems that effort has no relationship with success in Amway. Based on my experience, deception and lies seem to be a better way to succeed in Amway than by hard work.
But what if someone basically worked a part time job instead of Amway? If someone simply got a 20 hour a week job at $10 an hour (not that difficult), someone could earn about $800 a month gross income, or about $9600 a year. In ten years, even with no raises in salary, that person would have earned close to $100,000 more income. That money, if invested into a diverse portfolio can be the nestegg that allow someone to retire early, or to retire more comfortably than most. And that salary is guaranteed if you work the hours.
In Amway, there are no assurances of anything, even if you work 40 hours a week. The only assurance if that you will help your upline earn more than yourself by moving products. If you are on the system, you are basically paying your upline (via tool puchases) for the priviledge of boosting your upline's volume. It is why uplines teach you to "never quit" and to be "core". These virtures help assure your upline of profits, but does little for the rank and file IBOs. I write this blog post just to stimulate thought amongst IBOs and prospects. There are better and easier options than the Amway opportunity. If you are reading this, you are looking at one potential alternative. It's your job to decide.
So would it be suitable just to be a prosumer, basically buying/selling to make a small income and just pay for the standing order instead of paying for the other things?
ReplyDeleteSo Im consider being an IBO and doing things my way. I wanted to know would it profitable to just be a prosumer, buy/sell and make a small profit and use the standing order instead of paying the other fees like the premier membership, communikate, etc
ReplyDeleteA prosumer is just a customer of Amway. Because Amway products cost more than similar products you can get at WalMart or Target, you'd be far better off shopping at WalMart and using a cash back credit card. This is a sure way to get good value and even get some money back.
ReplyDeleteAnd even if you earned a small rebate by "presuming", you would have less product than shopping elsewhere and buying voicemail or premier membership would guarantee that you have a net loss.
WalMart will match the price of any printed ad for the same product. Amway doesn't. That's why you "Live Better, Save Money" with WalMart.
I appreciate your answer!! So basically like you stated in your article, it'll be better to get a part time job to help build extra income to actually have money to start a business of your own?
ReplyDeleteWhether to work a second job or start a different business is your decision, but if you want to start another business, find one that has actual product demand and one where recruiting other business owners isn't a priority in order to be successful.
ReplyDeleteIf you've ever read about "millionaires", many of them do not live fancy lives or drive expensive sports cars. They often work in professions like termite extermination, or plumbing, or electrical work.
Unlike what Amway advocates, saving and not living a life of excess is a good way to accumulate a lot of money. Amway people want to show off sports cars and mansions as a way to get people interested in joining but the reality is that most of them, in fact the vast majority will never get those kinds of luxuries as a reward for building an Amway business.
So my sponsor is making 100,000 a year at 23. But everything I read here on blogs are the exact opposite. So do I believe the paycheck that my friend of 10 years is making or do I believe all the information the blogs are giving out? I don't need millions, only enough to spend time with my family.
ReplyDeleteYour friend makes $100,000? How do you know? Have you seen his tax returns? If not, all you see is a check not knowing how much your friend has in business expenses. Assuming he must be an emerald or diamond to make that kind of money, he would have significant business expenses including travel to and from functions.
ReplyDeleteAlso, I've never claimed that nobody in Amway makes money. I know that "some" people make money. I also know that "some" people make good money. But for every 1 that makes good money, there are hundreds or thousands who try hard and wind up losing money because of the pyramidal nature of Amway's compensation system.
Jel Kang. Just think a bit. If Amway regularly produces wealthy individuals, then tax consultants and wealth managers would advertise their services on pro Amway sites, and they would sponsor Amway seminars so they'd be for free. You'd see Amway businesses for sale, for those keen to cash in, and the bank would be keen to finance your purchase of it. You'd bump into many retired but young IBO's at ski and beach resorts, exclusive golf clubs and first class lounges. Charities would join the chorus of defending Amway, if wealthy uplines really were important donors. Everybody would talk about this breed of the benovelent wealthy, the way they talk about tech startups and investment gurus. If you go to a luxury car dealer with proof that you are a distributor, they'd treat you like royalty because they'd know from experience that you'd be a very good prospect with a simple cash deal. Or you could jusk ask your friend to sho you his financial statements and tax returns. If he is your long time friend, and he wants you to emulate what he's doing, and he has no qualms about telling you what he earns, he should have absolutely no problem with that.
ReplyDelete