Big Dreams?

 One of the many things that Amway IBOs are badly misguided on is the concept of dreams and fighting for dreams. A dream is basically a long-term goal. Someone might dream about playing in the National Football League. To accomplish that dream, one might play high school and/or college level football. For the vast majority, the dream will end. No matter how much someone wants to play in the NFL, only so many people are proficient enough to be able to earn a spot on an NFL roster.  Sometimes you might even need a bit a luck to find the right situation to be able to make the team.  Even fewer are elite players that become stars. So, while you might fight for your dreams, there is also an alternate reality. 

In the Amway business, via the "systems" such as WWDB or Network 21, the leaders will often sell hopes and dreams to the downline. That the downline can be retired at the age of 29, walking the beaches of the world while the income just rolls in forever and ever. These kinds of "dreams" would be the same as hoping to win the Powerball lottery. You may have seen a few who did it but the chance of you duplicating it is very unlikely. Slim to none is your chance in reality. Even those who might achieve diamond will find it difficult to maintain.  The truth is that there are many people who went diamond and are no longer diamonds and no longer receiving "residual income".

Another thing uplines will often do is tell anecdotal stories about crabs keeping each other in a bucket when one tries to escape, or about monkeys preventing each other from grabbing bananas at the top of the pole. While the stories may be interesting and even true, it doesn't necessarily apply to the Amway business. While it is true that an IBO may have friends and family who are skeptical about Amway, it is with good reason. Many people have gone through the Amway business with no success. Many people have lost money doing everything they were advised to do by upline. There is a track record of financial disasters associated with Amway and the attached "systems". It's not like there's a long list of people who have walked away from Amway with the cash rolling in and not a care in the world. Ever wonder why none of the crown ambassadors, as far as I know, have exercised the option to "walk away"?   Instead, crown ambassadors die on the job.

I think people should have dreams. I think people should pursue their dreams. I also think people need to know that certain dreams can come true. There also needs to be a degree of reality in their dreams. There will always be some inspirational person such as a "Rudy" who overcame great odds to accomplish a dream, but the untold reality is that there were probably many many young men who dreamed of playing for Notre Dame that year. Likely, no one else accomplished the unlikely dream like a Rudy. What I am saying is that earning a nice income and having the option of early retirement can be accomplished in many ways. You might be choosing to use Amway to accomplish your financial dreams and that is your right. But the reality is that very few people have made all their financial dreams come true due to the Amway opportunity, as compared to the tens of millions who have tried. 

Keep fighting for your dreams, but keep in mind that you might need a plan B and a dose of reality.

Another Story Of Deception?

 Author: Wally

Comment:

I live in the DC metro area and was approached by a guy in Best Buy about a "business opportunity". The word Amway was never mentioned once in the entire conversation. Instead, the focus was on his business and how there was a solid opportunity that shouldn't be missed. I figured it can't hurt, so I was open to listening. Even on his business card, it said nothing of Amway. The guy forwarded me a link to my email of his business which explored social networking. Again, kind of vague. It all came together when I went to my first Amway meeting.

Going in, I had no idea this was Amway. They all took pride in calling themselves entrepreneurs and were all extremely upbeat, positive, and social. The whole session was interesting, but when the speaker started talking about using your existing social networks on Facebook to potentially mine for sales clients...I was a little put off.

At this point, I basically said to my "sponsor", thanks but no thanks. However, he was strategic about his approach. He stayed away for a while, but came back later with a new opportunity to explore the world of the business. Honestly, even though I wasn't all that attracted to the business itself, I figured I may give it a go simply because it is taking me out of my comfort zone, is something brand new, involves numerous highly optimistic, social people, and seems harmless.

We reconnected, my sponsor and I, and I laid out the cash to get up and rolling. Every word out of my sponsor's mouth was a battle cry for victory. He did not know the meaning of defeat, or even the prospect of failing. He was relentless in his perspective that he is "winning". He is victorious in life and life is his to be conquered. It's here that I began to think that he is brainwashed. He seemed almost in denial to some things. Intentionally avoiding reality and choosing to be absorbed in a false notion. Weird.

After I was up and rolling, I attended the meetings, attended the social events, and mingled. I bought a bunch of stuff to meet the monthly PV goals, and also sold what I could. The selling was a lot more difficult than just buying the items myself. Even though the quality of the products are quite good, the prices are not exactly bargains.

After a few months of doing this, I realized that pitching products to family and friends, and in turn, alienating some of them, was not something I wanted to pursue any longer. It quickly became unappealing. And all the friendships made through Amway were friendships crafted through the desire for money. They were all financial transactions in form and substance. I was encouraged strongly to constantly bring new people in, and get them involved. Essentially, I would instruct them in the very same way that I was instructed by my sponsor. Inevitably, I would do my best to mentor them so that they have success, and their success became my success. Once one starts picturing how big the web can be, it can be hard to disengage.

My sponsor embodied very strong conservative Christian beliefs. He seemed to be infatuated with the Bible, and quoted freely from it. I think he thought of himself as a spiritual warrior as well as an entrepreneur. But it's not his products that he's selling. It's Amway's products. And he wasn't a savior; he is just a guy doing the best he can to motivate others to...sell products that are overpriced.

When I finally disentangled myself, he expectedly did not take it well. In so many words, he told me that your life won't be very meaningful once you leave Amway. He also said that he'll make a ton of money and is a part of a multi-million dollar business. That's all well and fine, but does he actually expect to be making millions? He is definitely brain washed by his upline guys. There's pictures of them rolling around in Ferraris and beautiful women...I guess he thinks this is his future.

In any case, I think the Amway business succeeds....at being a total failure. Why encourage marketing to family and friends? What does this say about the seller? That they value what the people closest to them can do for them on a monetary basis? What happens when the answer is no? Does this mean that this friend or family member is reprehensible or a traitor? Also, the products Amway makes can be bought at more or less the same quality at Target or Walmart, but cheaper. What's so special about Amway? Nothing. Starting a "business" is very different than "selling Amway stuff"".

And why the false sense of optimism, even when the reality is staring you right in the face? I suppose that a lot of these hardcore Amway folks are brainwashed into thinking that displaying vulnerability, or anything that might make you appear...human, is weakness. Too bad.

I think the correct term is used by the poster above, Terrance, "suckered". Please don't get suckered in. It all will look appealing. The Amway rep will likely be extraordinarily charismatic, friendly, social, and overall look like a very successful person. The people he's associated with will also be a positive, engaging bunch. However, beneath the surface lies a business, if it can be called that, which is a sham and a waste of time.

See all comments on this post here:
http://www.unhappyfranchisee.com/will-amway-make-you-annoying/#comments

100 PV?

 Most LOS groups that I know of, use 100 PV as the benchmark when promoting the Amway business. Many groups also teach that you simply "change" your shopping habits and you can easily reach 100 PV. This teaching creates an artificial demand for Amway products and I believe that Amway sales would take a huge dip if not for this teaching. I also am of the opinion that for this reason, Amway had/has done little to reign in LOS abuses of downline.

100 PV is roughly equal to about $270 to $300 worth of products. Of course, your cost may vary, depending on whether you purchase a lot of CORE Amway products such as laundry detergent, and nutrilte vitamins. For many people, the 100 PV benchmark is seen as the minimum for a business building IBO. The problem for many is that Amway products are not competitively priced, thus it is a hard sell. If I can buy the same or a similar product elsewhere for a fraction of the price, I will. And most consumers feel the same way.  And 100 PV is not the ultimate goal if you are "serious" about your business.  Some groups will encourage 150 - 300 PV if you are to be a leader and a serious IBO.

It is why some LOS groups such as WWDB or BWW adopted the "buy from yourself and get others to do the same" philosophy. Since most people do not like selling, and because of the high prices of Amway products, simply telling prospects to buy from yourself made the concept palatable. The problem with buy from yourself is that it reaches the borders of being illegal, in my opinion. That is because in a buy from yourself environment, the only way for an IBO to make a profit, is to recruit downline to benefit from the volume rebates. That is because there are no outside customers to bring in cash from outside the circle of IBOs.  How could a real business possibly survive if they relied on sales only to staff and not primarily customer?

What makes this issue even worse is when you have LOS groups such as WWDB creating an even greater problem with programs such as eagle. If 100 PV is an inflated demand for Amway products, incentive programs such as eagle make it worse. How can a single person reasonably be expected to move 200 to 300 PV when most of it is personal consumption?  What the upline tries to push is to hyper-consume a lot of high PV, but expensive products.   The upline leaders use these programs as an incentive for downline IBOs, but in turn, they benefit financially by having more downline volume, as well as potentially enhanced tools sales by dedicated downline IBOs.

I challenge any IBO or prospect to take a close look at your Amway purchases. Are you truly just changing your shopping habits and achieving 100 PV or are you buying things to give away, or buying things that accumulate somewhere? Unless IBOs are selling half of their purchases, they are probably overbuying Amway products. I believe it is simply because of upline teaching which creates a defacto 100 PV quota and an artificial demand for Amway products. I challenge you to examine this closely and make your own conclusions.

IBOs "Choose" Success?

 Many IBOs seem to think that success in the Amway business or in other aspects of life is simply a choice. They mistakenly believe that you can actually choose to succeed or not. They apparently believe that persistence and choosing to win will eventually land them a premiere spot at diamond club. If that were truly the case, wouldn't we see hordes of new diamonds each and every year? Instead, we see one here and one there, and while there are a few new diamonds in the US every so often, we see others quitting, dropping out or leaving Amway for greener pastures. Make you wonder if the prize is worth pursuing in the first place.

But IBOs and information seekers should understand quite clearly. You cannot simply "choose" to win or succeed. In a football game, both sides can believe and choose to win, but still, only one can be the victor. In Amway, it is common for a platinum to have 100 to 200 downlines. Thus, to be a platinum, you need to be in the top one half to the top one fourth of one percent of IBOs. To be a diamond, you will need to have about 600 to 1200 downline IBOs, not counting the masses of IBOs who register and do nothing or register and do a little and quit. Only one in about ten to twenty thousand will ever reach diamond in North America.

Sure, IBOs may cite some touching story like "Rudy". Basically, a nobody who dreamed of playing for Notre Dame. He busted his butt and did whatever it took to make the team, and the movie ends with him getting in a game, making a sack and being carried off the field by his teammates in a blaze of glory. A great and inspiring movie. But what you don't see is the possible tens of thousands of young men who had the same dream, may have worked every bit as hard but circumstances and situations prevented them from achieving the same limited success. Uplines want you to think these kinds of stories can happen to everyone, but the fact is that there is only a little room at the top. If stories like Rudy were common, then there would have been nothing special about it. An elite athlete like a Michael Jordan or a Tiger Woods only comes along once or twice in a lifetime. It is like achieving diamond. It happens but it is a rare occasion, especially in North America where Amway appears to be shrinking instead of growing.

In the Amway business, many prospects and IBOs are motivated and driven to succeed. Many of them are fine young men and women who want more in life. But the vast majority of those who try will not achieve their dreams via the Amway opportunity no matter how hard they work and no matter how badly they want it. The reason is because there are too many variables that are not in direct control of the IBO. The Amway reputation in North America is spotty at best so sponsoring downline is nearly impossible. And when you can sponsor, chances are your downline will do little or nothing. Many new IBOs will work hard but quit because they are faced with the challenges I just mentioned. And even if you can overcome the overwhelming odds, you still need to keeping working hard constantly to maintain the business, all for an unstable average diamond income of $146,995, which doesn't consider taxes, medical insurance and other perks you may receive at a job. All told, I believe the diamond income is not all it's cracked up to be when you consider the charade you must play to display the diamond lifestyle. Do the math and you will be able to see for yourself.

In the end, it seems as though the prize isn't as great as it seems, and the trail to success is one that most cannot endure. And even if you achieve diamond, you can lose it quite easily as others have discovered. The bottom line is that you cannot simply choose to succeed in Amway or any other endeavor. Good luck if you decide to attempt it anyway.

Customers?

 One of the apparently common practices among major IBO groups is still the concept of "buy from yourself". I believe IBO leaders teach this because most people are not good at or not comfortable selling goods and services. And this is not uncommon. In general, people do not enjoy selling and the Amway presentation is usually careful to avoid making the impression that you need sales. Instead, you might hear terms like self-consumption or being a prosumer.

Therefore, to teach buy from yourself makes the business an easier sell. In reality, an Amway IBO is simply a commissioned salesperson with no benefits. But presenting the opportunity that way is unlikely to yield results either, thus the buy from yourself has become a common practice. It makes it sound easy to just buy your own goods (or change your shopping habits) to reach 100 PV and qualify yourself for a bonus. Then you just get others to copy what you are doing. Easy right?  And everyone knows a handful of people to be able to sponsor downline and ultimately succeed right?

However, buying from yourself makes you a customer and not a business owner. Buying from yourself doesn't generate your business a profit. Would you open a car dealership to buy a car? Now I am not suggesting that supporting your own business is a bad idea. What I am suggesting is if you are the primary or exclusive customer of your Amway business, then you aren't really running a business. You are simply a glorified customer. And technically, without sales, you don't actually qualify for a bonus.

What an IBO is really doing is paying his upline's bonuses. Amway overcharges more than 30% of the cost of their product. They have to do this in order to be able to pay IBO bonuses. Since most IBOs are at 100 PV or less, the lion's share of the bonuses earned are channeled upline when a purchase is made. It is not a level playing field as some IBO leaders might suggest. Yes, you might be able to surpass your sponsor (not hard when most IBOs do nothing), but you will never surpass a tenured diamond no matter how hard you work because that diamond has a lot of influence over your business. 

What compounds the situation and makes it worse is when an IBO pays for standing order or attends functions where some of these IBO leaders may teach this bad business practice. You as an IBO already overpay for products for which upline gets most of the bonus, but then the problem is compounded by IBOs paying to receive this bad advice. When I was an IBO, I heard speakers talk about skipping rent or mortgage payments to attend more functions, or having your family skip a meal so you can buy standing orders. Buying from yourself is just another example of bad advice given from upline to downline. What makes it worse is that the uplines profit by giving bad advice.

Are you buying from yourself almost exclusively? Can you think of any truly successful business where the owner is the main or possibly the only customer? I can't think of any.

Dead Or Broke By Age 65?

 One of the myths that Amway IBOs and IBO leaders perpetuate is that 98% of people will be dead or broke by the age of 65. I have debunked this myth more than once, but I had an interesting thought about this subject. If people are destined to be dead or broke by age 65 as IBOs claim, then for sure the Amway business is not going to change that end result. It is likely to ensure that you end up broke, provided you live to be 65 years or older. Imagine people who go all in for Amway, and wind up with $202 a month? You would be a surefire qualifier for food stamps or some other government assistance with that kind of income. Ironically, Amway IBOs use the fear of being broke as a means to recruit people to do Amway.

Amway's own disclosure numbers show that the average IBO earns about $202 a month. And that $202 a month is not counting IBOs who did nothing, and it is gross income, meaning that business expenses and taxes have not yet been factored in. Unless you have a large nest egg, pension, and/or some kinds of investments to live on, the amount of income that the average IBO earns from Amway won't make any difference in their lifestyles. In fact, if an IBO is putting 10-12 hours a week into their business, then that IBO is earning less than $3.00 an hour for their efforts. You would be better off doing much more lucrative work such as flipping burgers or greeting customers at WalMart.  And if those same IBOs are participating in the system of tools and functions, then IBOs are likely suffering a net loss of income after expenses are factored in.  How do losses help someone's finances?

Seriously, if you are looking at Amway as a business opportunity, then the average earnings should be alarming. The person prospecting new people will say that the average is low because many people quit or don't work hard enough. The question to come back with would be why this is so if the business was so efficient and the products were so good?  If you note that the average income is $202 a month for IBOs and .26, yes, that's roughly one fourth of one percent reach the level of Gold/Platinum where you might earn $1000 a month (before taxes and expenses), then most people would conclude that it is not a good business proposition. I wonder if many Amway prospects are young and inexperienced in life, thus unable to properly evaluate a business opportunity? Or do Amway recruiters make the business sound simple and easy, which would be deceptive?

If you want to earn less than minimum wage on average, then Amway might be the perfect opportunity for you!

The 2-5 Year Myth?

  One of the things I heard and is still promoted is the concept of a 2–5-year plan to (to go diamond) financial freedom. As a prospect, 2-5 years of hard work in your spare time sounds reasonable. After all, anyone can work an extra 8-12 hours a week for a couple of years with that kind of reward awaiting you at the end. The sad reality is that you are likely to suffer 2-5 years of financial losses without getting any closer to financial freedom.  And that it not to mention the amount of time spent chasing an unattainable goal.  

When Amway morphed into Quixtar, a very relevant question was how many diamonds were "quixtar only", meaning they signed up in 1999 when quixtar was implemented and then became diamonds in the advertised 2-5 years. As far as I know, there were very few (if any) new diamonds. The new diamonds that were named all seemingly came from other countries, not the US or Canada. Even now, my former LOS (WWDB) was touting "double eagle rubies" which is not a recognized achievement by Amway (as far as I know), and there is no assurance that achieving such a level makes an IBO profitable. In fact, the eagle program run by WWDB is only measuring tool parameters which is great for upline but not necessarily for the IBOs.  The "eagle" program was focused on the movement of standing orders and functions, which are non-income producing activities, but creates a lot of income for upline diamonds. 

Even today, I do not see a steady stream of new diamonds emerging from Amway. If the 2-5 year plan actually worked, there would be new diamonds constantly emerging. Instead, my former LOS (WWDB), actually has fewer diamonds (from what I can see) now than back in my IBO days. And of those diamonds who remain, some of them had homes foreclosed and it also appears that at least a few of them ran into some financial difficulties. Makes me wonder what a diamond's finances actually look like. I suspect many of them live in debt, especially if they flaunt the "diamond lifestyle", which is probably not sustainable on diamond income as reported by Amway.

So while it might be possible to achieve diamond in 2-5 years (some have done it), but tens of millions (or more) have tried. It is much more likely that you will win the lottery (provided you have a ticket) than it is likely that you will join Amway and go diamond. It is also unlikely that people in the US and Canada who join will go diamond in the advertised 2-5 years. The 2-5 year plan is not promoted by Amway, but by the LOS leaders. I believe it is a hoax and the numbers back up my claim. You are much more likely to be better off working part time for 2-5 years and saving and investing for your future. If not, you will end up with 2-5 years of losing money on functions and standing orders.

As many Amway leaders will state: Look at the fruit on the tree. In the US and Canada, the trees are bare.

The WWDB Eagle Program?

 Eagle Parameters:

Signed Counsel Sheet to Upline Diamond
300 PV personal use/retail for couples, 200 PV personal use/retail for singles
6-5-3 (PB/SO/MF) - Explained below
6 legs at 100 PV or higher
5 legs on standing order
3 legs attending major functions

What is Eagle? Basically, Eagle is a made-up goal. I believe it was originally made up by WWDB. In fact, I think Eagle was around when I was an IBO back about 25+ years ago. The reason why I say it is a “made up goal” is because it is. It was not a part of the Amway sales and marketing plan. You receive ZERO additional compensation from Amway for achieving the designated level of Eagle, aside from your volume rebate. In a previous post (recently), I broke down the numbers, giving the IBOs the benefit of the doubt in sales, and the only conclusion I could arrive it was that most Eagles must be losing money.

The Amway sales and marketing plan, as shown in many groups, assume that an IBO will move 100 PV in volume, though a combination of personal use and selling of products to family, friends and customers. To be an Eagle, you are expected to move 300/200 PV (Couples/singles) in personal volume. In many, and probably most cases, an IBO typically will consume most of that 100 PV by him or herself. That means the Eagle program artificially inflates the need for Amway products. If you disagree, name one former Eagle (and I am one) who consumes Amway products to the tune of 300/200 PV per month. *crickets chirping*

I believe the Eagle program was simply the brainchild of some LOS leader who wanted to create some kind of incentive to prove an IBO’s loyalty to upline and to secure a certain level of tool purchases from downline. If you do the math and consider that fact that IBOs on standing order and attending functions are somewhat serious business builders, then every individual in the Eagle program is likely to be losing money. The person designated as “Eagle” may be duped into thinking they have a net business profit, but when you factor in the extra 200/100 PV that you are expected to move, you are losing money, possibly lots of money, unless you are selling that extra 200 PV. If not, you are simply absorbing an extra $300 to $600 worth of products that you probably do not need, If Eagle was truly something worth attaining, wouldn’t it be promoted by Amway and given some kind of financial incentive?

As an IBO, you are MUCH better off simply by moving your 100 PV with a combination of personal use, and selling to friends, family, and most importantly, retail customers. In fact, someone simply selling 200/100 PV in products at full suggested retail price is likely to be better off than someone who is at 1000 PV with an Eagle structure, but self-consuming the majority of the 300/200 PV personal circle that is in the Eagle parameters. I challenge anyone to show how a group can be better off financially by maintaining an Eagle structure. *crickets chirping*.

More Excuses?

 I've been a blogger now for a number of years. I've debated with Amway apologists and they ultimately resort to excuses and/or personal attacks when they run out of defenses. Food for thought, when you have to make excuses about why your opportunity isn't a scam or a pyramid scheme, that should already make you stop and think for a minute. The easy excuse is to say that "my group isn't like that". Yet I see testimonies and statements that indicate to me that things have not changed, even in all the years since I left the Amway business myself.

Even the product's prices need to be justified. That there is concentration or other factors that really make Amway stuff a better value. Strange how that better value doesn't seem to translate further once an IBO realizes that there is no residual income at the end of the rainbow. Many IBOs don't seem to mind paying for Amway stuff when they believe that they will one day walk the beaches of the world while more money than they can count will keep rolling in. When the dream fades, so does the desire to purchase these awesome products. If not, with tens of millions of former IBOs, Amway sales should be through the roof after all these years. But it hasn't.  Amway's sales peaked some years ago with about 10+ billion in revenues.  I believe they have not reached that level since, even during covid when online sales went through the roof for Amazon and other online retailers.

Amway also reported some years back, that they have updated their average IBO income. While it is still miserable, it has gone up (currently about $202 month, excluding IBOs who allegedly did nothing), although a clear explanation as to how and why they calculated the "average income" was not apparently given. So, the debate continues. Critics analyzing and predicting how and why, and Amway apologists making excuses and justifying their position. Why not just be transparent and end the debate once and for all? I think most people know the answer. The bottom line for most is whether or not they make a net profit. For the vast majority of IBOs, especially the ones on the system, the answer is a net loss. It is predictable and easy to conclude. The 6-4-2 or any other version of the compensation plan clearly shows that very few people can make any decent money. If a platinum IBO typically has 100 or more IBOs, that is your answer there. It should be noted that a platinum might not even be very profitable if they are sold out on buying system tools.

So IBOs and Amway defenders, are you making money (net profit)? Or are you just making excuses?

The Real Scam?

 A lot of people come and go in Amway, but many of those who come and go don't even notice the scam. They get sold on what they believe is a business opportunity that they can make some money at, or at the very least save some money on products that they would normally buy anyway. If they do it right, they can possibly make some "real" money and with some had work, you can build it right and have the option one day of walking away from Amway and living off ongoing residual income from Amway. It sounds reasonable and therein lies the scam.

For years, I have challenged people to name 2-3 people, aside from the Amway owners, who joined, built the business "right" and was able to walk away and retire with ongoing residual income, enough to be financially free forever. Not a single person has been able to name and confirm that even a single person has done this. I believe it's all a lie and part of the scam. Amway's distributor force turns over about 50% each year. How can you build a residual income empire when half of your downline quits each year? I believe Amway diamonds trade their 9-5 jobs for the night shift. They work at night and into the morning hours because they are working to replace people who quit and to support downline platinums who might struggle or fail to re-qualify for that level. If upline says they are working for the love of their downline, I call BS on that. If walking away and enjoying life was an option, why hasn't anyone chosen it?

Now you could argue that a diamond's "work" isn't that bad and they aren't reporting to a boss. And that would be true, but I imagine the pressure of churning people in and out to keep qualifying can be stressful in itself. If you live on an island like me, you can eventually have trouble finding new people to work with. In 1997 or so, there were a bunch of diamonds in Hawaii, and they all moved to the mainland. Now I'm not sure why but my upline diamond was Harimoto, who loved the ocean and the beaches. Yet he moved to Washington state. I believe they needed new grounds to mine, just like gold miners.

The next part of the scam is how IBOs will tell you about Amway's generous money back guarantee. 100% they'll tell you. What they don't tell you is that the guarantee is only on some of the products and the signup fee. The cds, books, voicemail and functions are not sold or run by Amway. And these expenses can be very significant over a period of time. IBOs and prospects need to know this. You can lose thousands and get back pennies on the dollar asking for a refund on the signup fee and perhaps a few products. Another piece of the scam.

Also, IBOs and prospects are often shown only the very best-case scenario (such as going diamond) but not told that your chance of being struck by lightning is much higher than your chance of going diamond, even though going diamond is not a random event. A real life and likely scenario is getting in and trying hard for a while, and then quitting with some business losses. At least if you know this and still try anyway, you will have done so with full disclosure.

Lastly, it's insidious in my opinion, for upline to tell you to trust them and to do as they say and then turn around and tell IBOs that failure is their responsibility. That they didn't work hard enough or do thing just right. That sure isn't what they are preaching when recruiting you into the business. They are saying how sharp you are and how you're likely to tear up the business. But it's just another facet of the scam. I've outlined the parts of the opportunity that I believe are scams, but I'm sure it's not limited to my point of view.

Good luck if you read this and join anyway.

Not Trying Hard Enough?

 One of the things Amway IBOs are taught is to blame themselves for is not working the business hard enough or not doing things right, exactly as upline advised. Actually, nothing could be further from the truth. It's just that uplines want to be absolved from any responsibility so they teach downline that failure in Amway is their own (The downline's) fault. Upline is also quick to take credit for any success, of course. Why shouldn't these same leaders be held accountable for their downline's results? And I would argue that the numbers of failures (the vast majority) would suggest that upline advice is suspect at best and terribly ineffective at worst. To compound the problem, uplines can make significant money from the sale of tools and functions so they should be taken to task for the results. However, most IBOs just quit and then fade away, often blaming themselves for failure.

The reason why hard work doesn't equal success is because an Amway IBO is basically a commissioned salesperson. In commissioned sales, one can work hard for no reward and at times, little effort may reap large rewards. But in Amway, with a bad reputation, Amway IBOs are dealt a handicap that most simply cannot overcome. Getting new people to recruitment meetings is hard enough, not even factoring in the ability to sponsor others. Then you toss in the high and non-competitive prices of products and when factoring in these tidbits, it's easy to see why uplines teach buy from yourself and selling is not needed or emphasized in a serious manner. Selling products average in quality and premium in price is not an easy task. For that reason, it's easy to see why Amway is a difficult business to navigate.

The work involved is very simple. Sell products and get other IBOs in your downline to be able to leverage your volume. Many IBOs work hard and attend all of the functions and do all of the steps as outlined by upline, but very few reap rewards and most quit when they realize that the system just doesn't work. It is sad that on top of losing money, that IBOs are also taught to blame themselves for their demise. Where is the upline when IBOs bust their butts working hard and get no rewards? On top of that, to make it worse, uplines profit from selling training and motivation to their downlines. Why aren't they held accountable?

I've read comments by some Amway defenders wanting to sue Amway critics for a potential loss of business. What loss of business? Most IBOs do nothing and quit to begin with. Most critics, like myself are simply stating our experiences and opinions. Many of which are true and still happening today. So I will ask, what about the millions of former IBOs who may have lost billions of dollars because of false claims which led them to believe that they would get rich following upline advice? Maybe former IBOs should unite and file claims against unethical upline leaders who led them astray? Why not hold these leaders accountable?

In any case, hard work doesn't equate success in Amway and I dare anyone to try to prove me wrong.

Ask Amway?

 There has been some debate by both critics and Amway IBOs and supporters over an issue regarding a WWDB Dream Night function. The issue was an honest question over the cost of a Dream Night Ticket. Anyway, to make a long story short, here is what the IBO suggested we do:

"Here is a tip when doing research, if you have a question about a company why not give the actual company a call? Wow what a concept."

While on the surface, that may seem logical. If you have a question about how a company works, that might make perfect sense. But the Amway opportunity, along with the attached motivational tools companies, make that a nebulous situation. What are you supposed to do? Call WWDB and ask if they are a good company? Call WWDB and ask if they scam their downline? What if you call and ask WWDB if most IBOs on their system make money or lose money? If you look at the average income of the majority of IBOs and factor in expenses such as voicemail, standing orders and functions, I can only conclude that the vast majority of IBOs on the system have to be losing money. The longer you stay in the system, the more you lose. Furthermore, I believe there are more people winning the Powerball lottery in the US than the number of new WWDB diamonds emerging in the US in the last dozen years ago or so.

Imagine if you had questions and simply asked the person? Hello? Mr. Al Capone, I heard you were a gangster in charge of organized crime. But I thought it would only be fair if I got the answer directly from you. What's that? You're not a gangster and you go to church? Okay, I see. Well, that clears that up. Mr. Capone is not a gangster; I confirmed that by asking him. Do you see the ridiculous justification of just asking the person in question? Isn't a better way to ask a neutral third party or some outside and independent sources?

Many IBOs will also suggest that you check the better business bureau. Well, Amway might have a good mark from the better business bureau. But Amway isn't selling you voicemail and other support materials, right? That would be WWDB or some other motivational group, or a particular double or triple diamond, whose business may not have been registered or known to the better business bureau. Also, a good rating from the BBB doesn't mean that IBOs are making profits. It just means that Amway deals with their complaints.

I believe IBOs, information seekers, and prospects can find a ton of information on the internet using google. Upline leaders discourage this because too much frank and disparaging information exists about the Amway opportunity. But much of that information is real life true experiences. I was an up and coming "mover and shaker" in WWDB. This blog reflects much of my real experiences and the realizations I came to after having left Amway and WWDB. Sadly, my experience was not a good one, but more and more I see evidence that what I was taught more than twenty years ago is still taught today, and by some of the same leaders. I hope my experience can help others.

Your Amway Education?

 One of the really dumb things that some Amway defenders do is to compare the teaching of WWDB or Network 21 (for example) to a real and legitimate college education. Some people even go as far as to encourage young people to skip or drop out of college so they can focus on Amway. That makes me really upset to know that these upline leaders so greedy for a dollar that they would encourage a motivated young student to basically risk their future to build a business where you have a fraction of 1% of making any real money and possibly less than that percentage of keeping and maintaining it.

There is plenty of documentation available to show that college grads earn more than non-college grads. I believe the difference on average was about $1000 a month more in favor of college graduates. While not all college students graduate, the rate is about 50%. College grads also earn about an average of $50,000 or so. According to Amway, the average IBO earns $115 a month or less than $1500 a year. The Amway earnings are gross, thus IBOs on the system (functions, standing orders) are probably ending up with a net loss. Try feeding your family with zero dollars.

While there may be some value in some of the material provided from upline to downline, it doesn't seem to translate into net profits. Thus, an intangible benefits an IBO might receive from his/her Amway education can likely be found elsewhere, without having to run a losing business. Imagine a scenario where two people apply for a job. One candidate has on their resume, a degree from the University of Washington. The other one says they have four years of education from Worldwide Dream Builders. Which candidate is more likely to get a serious look? Do IBOs believe that the stuff they learn at functions is substantial enough to compete with a real and accredited college? If so, then they are likely to get laughed out of the room if the need to compete for a job.

Or how about using the 6-4-2 plan to get a business loan from a bank? What do IBOs learn that can be applied to something outside of the rose-colored world of Amway? I find that uplines who get young people to funnel their education dollars towards WWDB or some other system instead of finishing college is a crime. I hope that information seekers find this information before they get persuaded into believing some of the lies told by some upline leaders. I find it ironic though, that many of these same leaders send their kids to college. Hypocrites?

The BS In Writing?

 This is a contact I received from a WWDB IBO some years ago. Notice the tapespeak and wild income claims.   At this point, this is a bit dated, but it's in writing and it's real.   It's hard to believe almost, but I would suspect that some of this kind of stuff is still taught in smaller groups.  Most likely not in large functions.  This is how the upline gets away with it, by teaching it in small intimate groups.  Anyway, this was the response I received to an inquiry I made with this IBO: 

Hey, thanks for the reply, I would be happy to tell you what i do, and who i work for.

I am what you call an IBO or independent business owner, its a franchise you can buy in for only 60.00 dollars. Basically the key to making money and plenty of it is to recruit other people to sign up and start their own business. With starting your own business you sell Quixtar's products, and they have everything, so its not hard for anybody to find something they like, also Quixtar has 30 partner companies such as: Circuit City, PacSun, Nascar etc.

Sure, to start your own business you sign up with quixtar.com. WWDB or World Wide Group is a company that provides you your website plus learning and training materials to make sure you become successful in the business. They pretty much hold your hand until you become successful. As far as what i have accomplished in owning my own business i have only had my business for 1 month now and am very happy with it. My mentor or upline, the guy that sponsored me into getting my own business started is my girlfriends father, and he is very successful in the business, which is why i joined, if i told you how much he made a year you wouldnt believe me.

The plan that World Wide group puts you on is mapped out to make you earn 80,000 dollars your first year, which means you would become a platinum member, it goes all the way up to diamond members which make in the six figure incomes

World Wide is not free, but it pays for itself because you will see customers sign up to your website to buy products, you will sell to your family, friends etc., plus if your like me you will try to sign as many people up in your first month as you can, so no, world wide isnt free, but it will pay for itself.

Yeah I’m still in it, i probably work with it about 8-10 hours a week. No, I’m not on pace to make $80,000 in a year, but it’s my own fault, I did not work hard enough. One good thing though, I know I am a better person and getting a check every month helps, even if it’s a small one.

Is Your Business Sustainable?

 One of the selling points of the Amway business is for people to do the work once and then reap financial benefits for life. Thus, the term lifelong residual income or passive income. But that simply does not happen for the vast majority of IBOs. The reason why most IBOs do not have a sustainable business is because their business is not based on sales to genuine customers with a genuine need. Most IBOs themselves will not buy Amway products once their affiliation to Amway is over. Many IBOs are willing to pay the "premium" prices while they believe Amway will make them rich, but when the reality sets in that they are not making money, somehow their loyalty to Amway products goes out the window.

If you are an IBO doing your 100 PV monthly, then your only way to increase volume is to sponsor downline in hopes that they will also do their 100 PV as shown in the plan. And even if you are somehow able to accomplish this and sponsor a bunch of people as shown in the plan, chances are that many IBOs will "do nothing" and of the remaining, some will move 100 PV, but they will likely quit in one year or less. The attrition and failures in Amway make it nearly impossible to build and sustain a group. Even diamonds are working hard to help their downline keep up the volume or they too, will fall out of qualification. Has anyone actually heard of a diamond who walked away from Amway and is collecting large residual checks while doing nothing? IBOs often talk about it but not a single one can name one of these individuals.

In many or possible most cases, IBOs are only selling the Amway opportunity and not Amway products. They sell the possibility or hope that they will build a business, walk away and collect untold wealth for the rest of their lives. It isn't going to happen. Say for example, you sold 100 PV monthly on a consistent basis to customers. These customers will automatically go online and make purchases when they run out of their products. If you are lucky, they will also refer friends to make purchases. But most IBOs do not sell products, they are selling the opportunity. Thus once the business building stops, so goes the product purchases in most cases.

That brings up the next point about why an Amway business is not sustainable for most. The products cost more than most other retailers. That will limit the potential for customers and referals. Amway defenders like to cite quality issues, but most customers who shop online aren't familiar with Amway products and have no way to know whether Amway has quality products or not. That leaves them to decide based on prices. And Amway in general, costs much more than Walmart for the same or similar products. A tough sell indeed and for these reasons, I find the Amway business to be unsustainable. There is no other conclusion that can be made.

Keep On Paying?

 One thing that appears to be common amongst IBOs is how IBOs are in denial. They truly believe that their uplines are working in their best interest and that upline wants their success. I don't believe that to be true. If uplines were truly making a fortune from Amway, why would a downline IBO have to pay for practically every bit of help they get from upline leaders? Why aren't any functions pro bono? What difference would it make to someone making millions heaped upon millions?

To show the plan, you would need to pay to attend an open meeting, and pay for your guests, even if they do not register as a result of the presentation. You pay for voicemail to communikate with your upline and downlines. You pay for standing orders, and you may end up paying twice if you were in attendance at the function when the standing order was recorded. You pay for books and other materials as well.  All of these "tools" are profit centers for your upline.   And they most likely make much more from tools than from Amway because the profit margins are higher and unlike Amway, downlines don't get even a small percentage of the sale from tools and functions. 

What's more, many IBOs turn their heads when ugly facts rear their heads. For example, some IBOs deny that a prominent triple diamond was involved in bankruptcy proceedings. They continue to edify and pay for financial advice from someone who could not even manage his own finances. They believe that Amway saves marriages even when the leaders who speak this may be getting divorced. It's like upline simply revises history and downlines buy it without question. Many IBOs do not even see it as a problem that some upline boldy lied and said there were no profits from tools in the past. I find this odd because tool profits are still shrouded in secrecy and downline simply believe that they will eventually get a cut, even without a written compensation plan and agreement.

I believe too many IBOs are simply in denial. They give upline their trust and upline abuses it. IBOs are told they are successful for attending a function even when they might be losing money month after month. They may be told that the Amway business is not about money but about making friends. They may be told that they are nicer people because of their participation in Amway. What too many IBOs do not see is that they are in denial about their business. Most IBOs are losing money, a little at a time, perhaps $100 or $150 a month. For the hardcore dedicated IBOs, possibly much more. But they are taught to ignore these simple facts and deny that there is a problem.

It is my hope that exposure of some of these tactics will be beneficial to information seekers and perhaps new IBOs who have not yet been fully indoctrinated. I encourage people to ask tough questions, demand answers and use due diligence when checking out this opportunity. The fact is that very few people every make a profit and people should know this before getting involved. In the end, IBOs pay up and they keep on paying upline for their sage advice, even when their bank accounts keep getting lighter. Where will it end?

It's Tax Time!

 This is a re-post of an older article but very applicable at this time. 

Check out this post by Forbes blogger Peter Reilly. He has written articles in the past documenting some cases of Amway IBOs being hosed by the IRS in tax court because they have no business plan or a realistic plan to make a profit. He even mentions Joecool's blog. Imagine that? My blog mentioned in Forbes!  I recall that Amway diamonds used to advocate that Forbes is very credible!

http://www.forbes.com/sites/peterjreilly/2016/06/25/tax-court-denies-amway-losses-due-to-lack-of-profit-motive/#662835204815

I was surprised to see that I haven’t written about an Amway case in over two years. Well, a new one came out this week and James E. Hess, like pretty much every taxpayer who has ever disputed disallowance of Amway losses in Tax Court, lost. Amway cases are a subset of Section 183 (commonly known as hobby loss) cases.

The rule is that in order to post losses to your tax return, the underlying activity has to be one in which you were trying to make money. I have written about quite a variety of activities where the taxpayer has contested an IRS hobby loss determination- musicians, artists, drag racers, players of slot machines, even blogging to name a few. The most common though are horses and Amway. The horse people frequently win, but the Amway people pretty much always lose

A Bit About Amway

The Hess decision is of interest because it has more in the way of discussion of the Amway IBO (Independent Business Owner) experience. There is the big picture of how you can make money in Amway.

"Amway distributors can generate revenue by: (1) selling products directly to consumers; (2) earning points through Amway’s reward point system; and (3) sponsoring other individuals who join Amway as distributors. In the latter case, the original distributor is called an “upline” distributor, or a sponsor, in relation to his new recruit, the “downline” distributor. The upline distributor receives points when any member of his downline sells Amway products even though he does not participate in the sale. Those points can then be redeemed for cash in the form of a bonus check. If a downline distributor engages another individual to be his downline distributor, the original upline distributor takes a percentage of the sales of both downline distributors even though he had nothing to do with the activities of the new downline distributor. Thus, to maximize Amway-related income, a distributor must sell Amway products and also try to enlist other individuals as Amway distributors."

The Missing Business Plan

The Tax Court denied the losses because Mr. Hess did not have any sort of a business plan. What he received from Worldwide Group “did not contain information that is generally found in a formal business plan”. It was more of a description of how revenue could grow.

It is interesting to note that the Tax Court has become a little more relaxed in calling for formal business plans in Section 183 cases recognizing that people in essentially crap shoot businesses like art and horse breeding don’t need accountants to tell them how to make money. Yet it seems to be holding the line when it comes to Amway.

Mr. Hess reported net losses from 2005 to 2011 ranging from $10,000 to $25,000. In only one year did revenue exceed $1,500. Nothing changed.

Tax Court Seems To Align With The Critics

What I found most intriguing about this decision, is that way that it mirrors critiques of the Amway experience, which seem to have their own section of the blogosphere. For example Joecool of Amway – The Dream Or The Scheme? recently wrote in a post called Amway Success?
“

Submission to upline was one of the things we were told. Our group was told that upline would never purposely lead us astray so we should trust them and never try anything without checking upline.

Our group was taught to reduce debt, but ironically, upline said it was okay to go deeper in debt if it was to attend a function or to buy more cds.

Anytime we asked about how much income uplines may have been earning, we were either told it’s none of our business or shown a photocopy of a 10 year old bonus check that someone upline may have received. Our proof that the business worked was upline showing off pictures of sports cars and mansions.

Losing money is success. Many times, our group was told that losing money was a sign of success. It was success because we were investing in our futures. That the business really is not about money but about friendships. I suppose upline taught this because everyone was losing money so it was nice to hear that success was around the corner, and that we were all nicer people and on our way to success if we just attended more functions and bought more standing orders

Why I Joined?

 For people who have already joined Amway and are trying to make a few bucks, only to see net losses month after month, you have to wonder at times why you joined Amway. As an IBO, I initially joined as it was pitched to me that I could easily earn a couple of hundred dollars a month, which could make a big impact on my life at the time. Of course, it made sense that I needed to invest a little bit of money to get started and to learn about how to run a business.  That's how they hook you into the tools and functions.   Afterall, who wants to make a few hundred when you can go diamond and have lifelong untold wealth, right?

When I got started, there was a lot of hype and excitement in my business. I sponsored people and my business was on its way. I was touted as a mover and shaker and even got to attend some home board plans with my upline diamond. Even though I did as I was advised, had the parameters in the business that were recommended, I noticed that any cash I had earned still resulted in a loss, or if I made some money, the "next major function" ate it up and then some. As you should know, there are four major functions and a bunch of regional ones. But for many, the major functions take place out of your area, requiring travel, sometimes by air, and you'll need a hotel room and car rentals in many cases.

It was at the function called "family reunion" where I started to figure out what was happening. My upline platinum was having us "hang out" after the function at about 1:30 am. He started talking about how the business has nothing to do with money. That we made friends, became nicer people, better spouses or parents, and that money was the least important aspect of the business. While many nodded in agreement, I was thinking what the heck??? I wouldn't have joined and "invested" that much time and money into a business where I was "moving and shaking" but not making money.

Many IBOs are at a point where it may be hard to quit. You may have invested some time, money, and effort into your business, and you may have been programmed to think that quitting is failure or that success is right around the corner, and you don't want to quit too soon. But I urge you to look at facts. What is your bottom-line net income? It is red numbers? Is it a recurring loss, primarily because of tool and function purchases? If that is true, ask yourself why you joined. Was it to be a nicer person or to earn some money?

What are your prospects of making a net profit soon if you are breaking even or taking losses? Amway leaders themselves have often said that insanity is doing the same thing over and over and expecting different results. Where are you at?

Don't Quit Your Job?

So many Amway IBOs have grandiose dreams of untold wealth, financial freedom. They think they will "build it once' and sit back on the beaches of the world sipping exotic drinks while the 6 figure checks keep coming in the mail. Sure, it's a nice thought, but not a single IBO I have encountered can name a single IBO who achieved diamond and walked away from the business to enjoy freedom while the money pours into their bank accounts. It is very likely that nobody like this exists. I suppose someone could go diamond and walk away from the business and still earn some bonuses, but very quickly, that business would likely fall out of qualification and the bonuses would shrink to nothing very quickly. Also, to earn bonuses, I believe an IBO needs to have side volume exceeding 2500 PV, which is roughly $7500 monthly in personal group volume. With normal attrition, it's easy to see how a diamond business can fall apart faster than a cheap suit without constant maintenance.

I also see and hear many Amway IBOs popping off about how someone in their upline is earning $60,000 a year or more. While it may seem like a nice income to someone who has a low paying or entry level job, that income is gross and may not leave much left after taxes and associated business expenses. Even a diamond with an average income of $150,000 (According to Amway disclosures for a  non Q12 diamond) in a year likely has a very low monthly income from Amway as much of that income comes in the form of an annual bonus. As a former emerald once told me, you needed to budget out that annual bonus or you could be in financial trouble later in the year, if Amway is your sole source of income.

Also, you may have seen diamonds showing off sports cars and other displays of wealth. My former LOS, WWDB has a function called "Dream Nite" where they show off lavish displays of wealth. Well, it is my informed guess that most diamonds cannot afford the lifestyles and toys that they show off in these functions. If you do the math, you can see that after taxes and other expenses, a diamond lifestyle is likely to be quite ordinary. Normally, nobody would care about this but since diamonds use this display of wealth to recruit IBOs and to sell tools, it is significant for IBOs to know. What likely happens is the most tenured diamond may have some nice trappings, and the slides will feature the goodies owned or rented by a diamond, as if all diamonds live the same way.

While it is great for someone to have dreams and goals, it is also important to have achievable goals. It is simply impossible for a room of IBOs to go diamond and to earn the kind of income that is shown in "the plan". Amway recruiters will show you "what's possible", but not "what's likely". To put perspective on that, it's "possible" that you can start a software company that puts Microsoft out of business, but it's not likely. It's possible for you to win the lottery, but not likely. My advice to IBOs is not to quit your day jobs - ever. Your dreams and goals can be accomplished in many ways, but it is unlikely to be achieved with an Amway business.

Million Dollar Business?

 So many IBOs mistakenly believe they will work for 2-5 years, own a million-dollar business and retire from their jobs walking the beaches of the world while cash rolls into their bank accounts. Sadly, most IBOs won't get anywhere near to the dreams they were sold as prospects in the Amway business. This in my opinion, is the crime in all of this. To fill someone's head with false dreams and hopes and then profit off them by selling them tools that will not help to fulfill those dreams. In fact, the cost of tools is what sometimes leads to financial ruin for some IBOs.  And those same tools are a significant source of income for the diamonds and higher ups.

Most IBOs will never sponsor a downline and many IBOs will not even have a single customer. What kind of business can become wildly successful and profitable without a lot of customers? It seems that only in Amway and some other MLM offshoots do we see this warped teaching of buying from yourself as a means to become successful in a business. Many people, desperately wanting it to be true, will buy in and give the business a try. Then after a while when progress stall or it becomes painfully obvious that things aren't working out as promoted, they get discouraged and quit. Most IBOs quit and never complain, partly out of shame, or perhaps these former IBOs don't want to complain about the friends and family who sponsored them.

I would challenge prospects to go and look at a million-dollar business. Go to the mall and see what some bigger businesses look like. Does your Amway business resemble it in any way? Do you have customers in proportion to a million-dollar business? Heck for that matter, does your upline diamond really have what looks like a million-dollar business or is their real business selling you standing orders and function tickets? It would appear that standing orders and functions are a million-dollar business. Many unsuspecting IBOs are the customers of the tool and functions. Unfortunately, there is no unbiased documented evidence that the tools do anything other making your uplines wealthy.  

A Part Time Effort?

 

First off, Happy Easter Sunday from Joecool!

One of the myths that my Amway upline used to, and likely still perpetuate is the claim that you can build an Amway mega empire on 8-12 hours per week, part time, or in your spare time.  I'm venturing an educated guess that this number is used because while it still represents time, it is probably less hours than working an actual part time job. But let's take a closer look at this 8-12 hours per week.  (Some groups might teach 10-15 hours per week, etc.)

If you listen to one (1) cd/audio per day as recommended by upline and read one of their "success" books 15 minutes each day, you are already close to nine to ten hours of time used and neither of these activities produces any income for your Amway business. In fact, both activities cost you money and produce no tangible result. If you spend another 15 minutes a day contacting people, you are close to 12 hours per week. Where will you find additional time to show the plan and to expand your name and contact list? What about servicing customers, at least for IBOs who actually may have some customers.  Maybe it's irrelevant when uplines teach "buy from yourself"?

What about attending meetings and functions? These are also non income producing activities. It's no wonder the vast majority of Amway IBOs don't make money. Their upline has them running around participating in activities that produce no income for their businesses. Ironically, these non-income producing activities such as listening to a cd/audio, produces a lot of income for certain uplines who produce and sell them. To me, it is just an elaborate game of bait and switch played by upline. They tell you that their system is foolproof and that you will make it if you don't give up.  The upline teaches IBOs to not give up because giving up means you are no longer their customer in their tool and function business.

You sell the prospect the dream of financial freedom. You tell them that Amway is their best chance to get wealthy.  You tell them that you can help them and that the tools of the business (standing order, voicemail, books, functions) are the key to their success. Those who are serious enough to commit to the system likely won't quit without making some effort and will allow uplines to earn some nice profits before these downline eventually realize they aren't profitable and quit. Because many IBOs are sponsored by family and friends, you don't see too many formal complaints about the business. Most people chalk it up as a life lesson and do not complain.  

But IBOs and information seekers, do not be fooled into thinking that you will create a financial empire by working 8-12 hours a week. That would be farfetched. The number of highly successful Amway IBOs versus the number who sign up are fewer than lottery winners.

Ruthless?

 The really insidious part about some of the LOS leaders, such as the ones I had in WWDB, is that they apparently are cutthroat ruthless businessmen with nice suits and disguised as your mentors and friends. They get you to trust them, and they will tell you that they have your best interest at heart, or that they would never purposely lead you astray. On the surface, you may think this is true but look at their actions and you can easily discern that some of these uplines are absolutely ruthless businessmen who would take every cent from you if they could. I was in WWDB, and I have good reasons to believe that they are still doing this, based on personal experiences. On this blog, I see much of the same teachings today, that I heard as an IBO and some of the same claims such as buying homes in cash, Amway saves marriages, etc. It's scary.

As an IBO, the diamonds would tell you to never miss a function, ever. The only good reason for missing a function was for your own funeral. I recall some crossline IBOs rearranging pre-planned anniversary parties, weddings, and other special family events in the name of being core and attending all functions. Some IBOs actually did quit their jobs to attend functions, and they very well may have done so because some uplines taught this. IBOs were also encouraged and told to go into debt to attend a function. This was okay because it was an investment into your business.

Our group was also strongly encouraged to buy extra cds every week. To be core, you needed to listen to a cd each day and you cannot listen to the same one each day right? Couples were told to buy their own separate standing orders. Brad Duncan even had a true north tape (cd) that said sponsors were to eat the standing orders for downlines who quit because it was too much trouble to call upline who calls upline who calls upline to cancel a standing order. Oddly enough, they didn't mind upline calling upline calling upline to add a standing order.

In the end, I was lucky enough to have been progressing up the pin ranks, so my losses were not that devastating. I ended up losing money in the Amway business but got close to break even when I was at 4000 PV.  However, I will say that major functions which required air travel still ate up my meager profits.  Sadly though, my crossline did not fare so well. I know of one couple who declared bankruptcy. I don't know how much their WWDB involvement contributed to bankruptcy, but I am certain it was a major factor, and I know of two couples who had homes foreclosed, and I believe that their allegiance to WWDB was a factor in those foreclosures. But I guess hey, two WWDB diamonds had homes foreclosed so maybe they were duplicating upline?

Do not be fooled. The diamonds may have a nice smile and a nice suit, but they are ruthless businessmen who will take your last dime if you allow them to.

Who Wants My Success?

 One of the biggest loads of guano that upline diamonds often tell their groups is that they really want success for their downline IBOs. It's very 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.  All they care about, and you can see it in their teaching, that they simply do not want you to quit.   It's because you staying involved and attending functions is money in their bank account.

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.  Or something similar such as success is simply not quitting.

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 cds?  

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?

Economic Wisdom?

 So many Amway IBOs simply adore their upline diamonds.  They practically worship the ground they walk on.  They give standing ovations, and record every word spoken by the diamond in hopes that they will hear that one thing or nugget of information or inspiration that propel their business t diamond.  They can their uplines "mentors" or coaches, although I don't really believe that mentors do their thing because they expect compensation from those they mentor.  Upline diamonds however, get paid practically every single time they speak.  And the faithful will jump through hoops and run the gauntlet just to be able to spend time with and extract wisdom from their vaunted upline diamonds.  

But the million-dollar question is what kind of economic wisdom gets passed on from the diamond to the faithful (paying) downlines?   In its simplest form, the Amway business basically consists of buying stuff, selling stuff and recruiting other downlines.   It isn't complicated or needing special skills.  So, it begs the question of why IBOs need a never-ending stream of training consisting of audios, books and functions?  Given the bottom-line dismal results seen by rank and file IBOs, I can only conclude that the training is completely ineffective, and/or the upline diamonds are full of sh*t.   

But all this begs a simple question.  With all of the teaching that goes on, what economic wisdom about business do uplines pass onto their downlines?   I know of many former IBOs who went on to do very well in life after Amway, but not much of that success has any connection to all of the business teaching and seminars that are supposed to be about running a successful Amway business, and/or business itself.  Shouldn't sound business principles be applicable to other businesses and aspects of your life?  Shouldn't you be able to apply these skills in order to succeed in other endeavors?    IMO, it's all just hooey and functions are just rah rah hype that keeps IBOs from quitting, which keeps the cash pipeline flowing upline.  

Let's examine this;  Upline teaches "buy from yourself" which solves the problem of people not enjoying sales, but it is not a sound and sustainable business concept.  Fake it till you make it was also taught.  How is being deceptive with potential business partners and associates helpful in the long run?  Another interesting common teaching is to copy or duplicated upline.  It sounds sensible on paper, but has no basis in reality.  It these concepts worked, wouldn't there be a consistent stream of new diamonds constantly emerging?   Instead, you see the same old diamonds on stage at every function.   Once in a while a new diamond will emerge, but they are far and few between.  

So, what do upline diamonds actually teach that can be beneficial to IBOs in other arenas of life?  Because their teaching has little to zero effect in helping advance the businesses of downline IBOIs working on their Amway businesses.  What information can an IBO glean from upline teaching?  Because it sure looks like they just teach hype and rah rah without any real form of substance.  Once you are not under the upline "spell" anymore, you can easily see through the BS.  The problem for most that that you suffer financial losses before you can see through the facade. 

Trust Upline?

 Over the years, I have encountered many IBOs and they often have a common theme. They trust their upline and in some cases, consider them as trusted mentors and teachers. Some IBOs go so far as to trust their new mentors over trusted friends and family. (This is also the insidious part of this whole scheme) Now in a business venture, it might be good to have a mentor or someone to guide you, but in the Amway opportunity, most of the upline mentors make money off those who they mentor. That is a major conflict of interest but IBOs simply fail to see it.

When an Amway IBO sees the plan in a big meeting, the speaker will often be built up as a financial genius, and possibly as an expert on how to succeed in Amway. An IBO may hear something about the trail was already blazed by upline and you just need to follow the trail. Don't re-invent the wheel, just duplicate what upline has done. But as I have said many times before, duplication sounds easy and looks good on paper, but in real life, the vast majority of IBOs run into problems that they simply cannot overcome, such as the bad reputation that the Amway name has in the US or trying to justify the ridiculous prices of some Amway products, which are generic in nature, but premium in price, which often makes sales difficult, save for sympathetic friends and family.

What is troubling however, is that IBOs are taught to trust upline and do as they say (defacto requirement), but they are also taught that failure is their own shortcoming, even when they do exactly what upline told them. It is also troubling that many uplines will tell their faithful followers that they need to purchase more and more tools (voicemail, cds, seminar tickets). In some cases, an upline may advise their downline to sacrifice basic family needs to buy these tools. Some IBOs were advised to skip meals to buy a cd, or skip paying the mortgage to be able to attend the next big function. I personally witnessed IBOs in my crossline who followed upline advice to their own demise (home foreclosure and bankruptcy). Sure, IBOs are culpable too, but the upline had the gall to give that kind of advice and had no accountability for the advice.

I might also add that as a newer IBO or prospect, you may have heard that "everyone starts at zero", or that it's a level playing field. It is not. As a new IBO, you will likely be in the 100 PV bracket. Since Amway pays out about 31% in bonuses, your upline(s) will split up about 28% in bonuses off your efforts while you get a 3%bonus. That doesn't sound very level to me. You also do not make any money from the tools. That is reserved exclusively for higher level pins.

So, each IBO should look at things objectively and see if your upline is helping you or simply helping himself by giving you advice that ends up in profit for himself with little or nothing for you. You might be surprised to know the answer.

Why You Can't Win?

 In Amway, there are recruitment meetings going on all the time.  These meetings could be small 1 on 1 types of meetings in coffee shops, or they could be house meetings with someone showing the plan to a handful of prospects or a large meeting in a hotel ball room or a convention center.  Last I heard, these Amway meeting venues have gotten smaller.  I know covid was a factor in the shrinking meeting sizes, but I don't know if things have recovered or not.  In the end it doesn't matter because Amway as a business opportunity is a lose money proposition for most, especially if you factor in the IBOs who are gung-ho attending meetings and functions and participating in the tools system such as WWDB, BWW or Network 21.   

The speaker will talk about big dreams, and possibly how he was in a struggle or rut, discovered Amway, had a big adventure building his/her Amway empire, but now live in luxury with cash rolling in while they sleep until noon and have no jobs.  This approach is very appealing to many young people, who are often in entry level jobs, or even perhaps professionals who think they can somehow gain a shortcut to untold wealth and riches if they can only overcome the name Amway and get serious about building a huge business.  In my experience, there were doctors and lawyers involved in the business, although they didn't seem to last very long, save for my physician sponsor who stayed in for more than 25 years.  I have no idea if he's still involved, but IMO, he stayed in long enough to basically ruin his life.  

The reason why so many people quit Amway is for various reasons.  Some people are lazy and never do a thing once signing up.  Or, they sign up and try really hard, but soon realize that the system will never work for them and after seeing nothing going on, they wind up quitting.  Some people, like my former sponsor, get bitten hard and stay hard core dedicated for a long time.  I recall my former sponsor telling me you can never ever quit if you have sponsored an active downline.  It's a sad result but so very common in the big picture of things.  I've been out of Amway for more than 25 years and I can barely see any changes or differences in how things are run, except for the online ordering aspect.  It eliminates the need for the ancient product call in and pickup like the old days where you literally had to call upline and order stuff and pick it up in person every week.  If your sponsor had a lot of downline, then this process could take up a lot of time.

But in the end, you simply can't win in Amway.   If you analyze the plan that is shown at meetings, the plan shows 1 in many achieve the "platinum" level or if you sponsor 6 big groups then you might be a diamond.  However, there is still only 1 diamond with perhaps 500-1000 downline or more.  That never changes.  Add in the fact that something like more than 50% of IBOs never last a single year and more than 90+% never make it more than 5 years.  You can't "win" and have large residual checks rolling in if people quit faster than you can sponsor them, right?

You can't win unless you get to share in the profits from tools and functions.  But rank and file IBOs only share in the PV/BV bonuses paid by Amway, and even at that, the upline gets the lion's share of the bonus unless you are a platinum or close to it.  The tools are where the real money is because they have a greater profit margin than Amway products, and only a certain level or higher has access to these bonuses.  Typically, the diamond gets the biggest share with the emeralds and platinums basically getting a pittance for all their efforts.  

While the IBOs "think" they can outearn their sponsor or even their diamond, it's all a facade.  Your upline diamond will always have power over you.  You think you suddenly arrive and you're "all that" but the reality is that your upline will always be your upline no matter what, unless you quit.  For this reason, it is highly unlikely that you can ever win in this kind of system.  

If you do your own research, you can easily find diamonds suing diamonds over tool money, or diamonds quitting or resigning from Amway (what happened to willable residual income?).  You can also find diamonds in bankruptcy or in foreclosure and even diamonds divorcing.  Oh yeah, they put on a good show and make the whole thing look appealing, but if you look with a critical eye without bias, you'll see that you really can't win.

I'm Nicer?

 Many Amway 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. 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".  I believe this is because upline needs to move the goal posts to distract from the fact that the vast majority if IBOs are at a net loss financially month after month, especially if they are participating in the tools and functions.

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 Personna 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.

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 recent 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.

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, especially after seeing some of the comments left here by IBOs and supporters.  :)

Pyramids?

 Let me start out by saying that Amway is a perfectly legal company as far as I know, and therefore I am not saying or implying that Amway is illegal. But I believe that the way Amway businesses are run with AMO guidance, are run like illegal 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. But this makes me wonder why IBOs are recruiting like their lives depended on it.

Unless you have a very rare group where actual product sales to non-IBOs in 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 break even and possibly start to make a real profit. But 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.

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. 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. Good luck in whatever you decide

If Not Amway?

  One of the humorous things that Amway IBOs often bring up is that someone who sees Amway in a critical eye should bring up viable alternatives. I mean if someone prevents you from falling over a cliff, they should have warned you and given you alternatives, right? If I recognized you getting were conned by a conman, I should find viable financial investments for you before warning you of the potential scam you are about to walk into, right? It sounds completely ridiculous, but Amway IBOs have actually made those comments on this blog and some other Amway related websites. It's astounding how upline has this special ability to get so many people to suppress their critical thinking skills.  It's almost scary and mind blowing when you analyze this with a neutral perspective.

Well, let's explore a few of these alternatives anyway just for fun. How about you stay home and do nothing? For most IBOs, you would be better off financially than committing your time and resources into Amway's products and their ineffective training materials and functions. If you are really dedicated to tools, sending your upline a check for $50 monthly and not buying Amway goods or related training materials would make you better off financially. Isn't it ironic that doing nothing makes you better off than Amway and the related systems?

A second job where you actually receive a paycheck is very likely a better alternative. While there's no hype and hopes of getting rich in 2-5 years, you can do much for your future by saving a portion of that paycheck each month. If you are young, this especially applies to you. But anyone can help their future by saving and investing. Even someone who panhandles is more likely to have more net cash than most Amway IBOs since most Amway IBOs make nothing or lose money.  At least panhandlers get some action and have some kind of net gain at the end of the day.

Sure, some people do make money in Amway, and some make a lot of money. The problem is they make money by exploiting their downlines and the vast majority of those hopeful downlines basically have no hope. In other words, you profit by selling false hope and false dreams. Basically, you can gain wealth in Amway by being a conman. Can you live with yourself in order to profit at any cost? What the upline does is extract $100 or a few hundred dollars a month from a lot of people.  Now that's a diamond lifestyle!

I haven't even gone into the amount of time lost chasing prospects and attending functions. Your time might be the most valuable commodity that is lost chasing the 2-5 year dream. Ask yourself this question. Where are these diamonds who did the 2-5 year plan living in luxury and doing nothing? I have asked this over the years numerous times and not a single Amway defender can name someone and provide a shred of evidence that it's true.

Rose Colored Glasses?

 One of the things IBOs get attracted to is how uplines will promote traditional family values. They may talk about the "Leave it to Beaver" days where the man works a job, and the wife takes care of the home and drops the kids off at school. While some of these values are great, they are not reality in today's world. The speakers at some Amway meetings may recruit others by saying you can have this out of the box lifestyle if you will only build your Amway business. This gets the wives or girlfriends excited as they would love to not have to work a 9-5 job.

Ironically, an IBO's desire for more time and money, more often than not, will result in less time and money for an IBO and IBO's family. They will take time off to show the plan, attending countless numbers of meetings and to attend functions. They are taught to "delay" gratification, but many do not realize that they are permanently delaying gratification by participating in the "systems".

An IBO's belief is often compartmentalized into thinking that showing the plan, listening to standing order, submitting to upline's advice and attending all functions will result in guaranteed success within 2-5 years. Anyone who speaks a differing opinion of this is "negative" and should be avoided. Sadly, those who put forth such dedication and invest in the system are rarely rewarded with success. Even those who achieve the platinum level may often find that the net profit they realize is less than a minimum wage job with the same number of hours put forth. And maintaining a platinum level is a daunting task.

My former sponsor achieved the platinum level in less than two years, but he never achieved Q12 status, and he never went beyond the platinum level. He has been involved for nearly 20 years now, and last I heard, is below the platinum level. All of that work and effort and I wonder if he even has a net profit of $1.00 for all of his efforts?

Yet, many IBOs continue to see the world through rose colored glasses, thinking that they will succeed if only they will never quit. They disregard the fact that 2-5 years has come and gone. They do not see that their bottom line is nowhere near what they were led to believe. But they believe that Amway will be their financial savior, even though there are facts and red flags pointing to the obvious reality that they will never achieve what they initially set out to achieve.

I hope my blog will get a few IBOs to take off the rose colored glasses for just a second and see the reality.