I have been reading some ongoing debates about whether the system income for higher pins is more than their Amway bonuses. I believe the systems such as BWW, WWDB, N21 or LTD, does generate more profit for upline than the sale of Amway products. How the system income is divided though, is still a mystery as it doesn't appear that there are bonafide written contracts explaining how tools income is split up among the higher pins.
But it's very easy to determine that more income is made from the system than from Amway. If you move $100 worth of Amway products, Amway will pay about $33 back in the form of bonuses. These bonuses will be split among the Amway IBOs (middlemen), depending on your level. The lower level IBOs getting close to nothing and layers of spline getting the lion's share. On the other hand, if your group bought say 20 cds at $5.00each, the system will profit about $80 to $90 as cds cost about 50 cents to a dollar each to produce in bulk. Some folks now use audio downloads so production costs have gotten even cheaper, thus maximizing upline profits. Some Amway apologists will cite the fact that some groups sell cds/audios for $2.50 or $3.00. While this is true, there is a "member's fee" which must be paid. And when you add in the member's fee, the profit for the system is the same or possibly higher!
If you buy a major function ticket for $100, the cost of that function might be in the neighborhood of $25 to $30 per attendee, so the system may generate $70 profit on a $100 sale. I believe the smaller functions such as open meetings, books and voicemail have smaller profit margins, but still overall, it's easy to conclude that the profit from the system is greater than profits generated by moving Amway products. And I might add that fewer people share in the tool bonuses whereas all IBOs have the potential to earn a bonus from Amway.
The only question is how much each individual earns. I have "heard" that platinums get a discount on the sale of standing orders and cds, but I have never heard of a platinum sharing any profit for functions, voicemail, or any of the other materials. This is puzzling to me as I believe the platinums do the most work in the system.
So for the lower level IBOs, if you move $300 in Amway sales (Approximately 100 PV), you will receive about $10 or 3% while upline enjoys the rest of the $90+ in bonuses from Amway. And then when you purchase and move tools volume, you receive nothing and some of your uplines enjoy all of the profit. While I don't see any problem in upline making a profit for selling training materials, I see a problem in the fact that the tools don't work. So few IBOs progress to levels where an actual profit is earned. Amway supporters will point out the new platinums emerging each year, but do not mention the platinums who do not re-qualify.
Based on my observations, I can only conclude (quite easily) that there is substantially more profit from the sale of support materials for upline to enjoy, and I can also conclude that the support materials are ineffective in training downline IBOs so they can progress to higher levels of the business. But then again, the multitudes failing while a few "succeed" is what MLM is all about.
https://youtu.be/8l4GykluIIk. This YouTube video may answer the question about how much platinums/emeralds etc. make from the system in North America.
ReplyDeleteI have met this speaker in person and he is genuine.
I have a friend who is a spy at WWDB (now called "World-Wide Group"). He confirms everything that you say in the above post. Diamonds and other big pins in the Amway structure make the lion's share of their money from "tools" (CDs, tapes, voicemail, training sessions, and "functions"). Many of these big pins haven't actually dealt with Amway products for years, except to make the monthly symbolic purchases that guarantee a small refund check. These products are then mostly used as giveaway freebies to entice new persons to sign up in your down-line.
ReplyDeleteOf course, all of this depends on keeping low-level IBOs in the business for as long as possible, and replacing those who quit with others. This (my WWG spy tells me) is the real reason why the entire Amway operation is geared to the generation of wild enthusiasm, and the suppression of rational thought. Without the screaming and shouting and hoping and dreaming of the low-level IBOs, up-line is in no position to make any money at all. And this is why intense psychological pressure is placed on IBOs to "stay in the game" and "keep the faith." If you can browbeat and humiliate an IBO, you can force him and shame him to continue paying you monthly fees, and buying useless tools that teach nothing.
And yes -- the tools cost practically nothing to make, and are sold to IBOs at a ridiculous markup. The Amway Corporation says that the training of IBOs should be free, but WWG compels all members to buy tools regularly, as well as milking these IBOs for "membership fees." As for the "functions," they are the really big moneymaker. After some functions, the organizers walk away with over a quarter of a million bucks.
Every single AMO that is a subsystem of Amway operates in this manner. They are designed solely to get you to pay a generalized tuition fee for "learning about Amway." But the AMO gives you no guarantee at all that you will be helped by this training. And just as you cannot sue a college if you never get a job after graduating, so also you can never sue an AMO if you fail totally in the Amway racket. My spy at WWG says this: "It's a perfect con-game. We rake in money by offering a service. But we are not responsible if the service you get will be satisfactory or not."
If the "tools" sold to you by the various Amway AMOs actually worked, why would you have to keep on buying them month after month?
ReplyDeleteIf I learn how to use a mobile phone, all I need is a few lessons and some practice, and I can use the phone easily. So why do IBOs need to get endless lessons from their up-line? If the Amway business is so goddamned simple, then the lessons about how to do well in it should be short and sweet.
The AMOs live off the sale of tools to their down-lines.
I remember one person who is crown in the business now , say in major function that even if Amway does not exist in the future we can still run a successful business selling something else because of the BWW system power. Looking back, tells me money is more in motivation than in products.
ReplyDeleteAll the Amway AMO subsystems can continue without Amway products. Products are just camouflage in an MLM scheme -- the real business of the racket is the recruitment of down-line members.
ReplyDeleteMany Diamonds in Amway have quit and set up their own MLMs, or transferred their entire down-line to some other MLM scheme. They don't need Amway products at all. They can sell fruit juice or women's clothing or scents or whatever.
People who have been in Amway for a long time, and who have had some success in it, laugh at you when you talk about the retail sale of products to non-Amway customers. They know very well that Amway is not about selling anything, but about convincing other people to join in and pay you fees.