Joecool On Vacation

Joecool is on vacation.  Heading to Vegas for some shows and a little gaming.   Be back in about 5 days.  Until then, enjoy this article titled:  "The Life Of An IBO"?

 I send this message to inform Amway IBOs that they should be aware of their circumstances in business. What I mean is when you are a new IBO, it is common for you to buy/sell your 100 PV and perhaps listen to some cds/audios. If you basically did what your sponsor or upline advised, you made your 100 PV bonus level and you will receive a bonus from Amway for about $10. If you did as advised by your upline/sponsor, then you likely made a name list and started contacting some potential business partners aka prospects. You're probably a bit excited because things are going as you expected. You did your part and a bonus is on its way to your doorstep. Heck, you may have even sponsored a friend or relative because of your newly found excitement and enthusiasm.

But what happens after a few months? If you are still doing 100 PV and have no downline, then what are the chances that you will ever achieve anything? Your excitement is wearing off and now the Amway opportunity is becoming "work". You are also starting to notice that it is starting to get expensive to continue to purchase products, many of which you never purchased before. For example, were you buying cases of energy drinks and "high end" vitamins before Amway? Did you buy $50 cases of bottled water before Amway? Supposedly their laundry soap and other cleaners are highly concentrated, therefore your consumables are the nutrition/vitamin products.

Even if you managed to find some downline, are they duplicating what you do? Are they also moving volume and sponsoring downline? If not, what are your chances of fulfilling the 6-4-2 plan or some similar version of it. When I saw the plan, I thought it was reasonable and I was on my way to platinum. What I discovered though, is that as you progress, upline has greater expectations of you and that includes more tool purchases. (I was in WWDB). In the end, my recommended tool purchases ate up any profits I had and at the 4000 level, I was just about breaking even, which means I was at a loss when factoring in my time spent and other miscellaneous expenses such as gas money.

Where are you at?  If you've been in for more than a year, are you on schedule to become platinum or are you at 200 PV with one downline? Maybe you have a small group with 600 PV? You still aren't close to a net profit. For the vast majority of people, success is not right around the corner. What's around the corner for most is more time lost, more money expended, and no progress. If your group is now growing each and every month, you are sliding backwards. If you don't constantly have new IBOs coming into the group, you are probably stagnant. With about half of IBOs dropping out each year, keeping a group together is a tremendous task.

IBOs, where are you at after a few months? Where are you at after a year? If you haven't gone platinum, it is nearly a certainty that it will never happen, despite what your upline might say. The facts are there; it's a matter of whether you want to believe it or not.

Goals and Dreams?

 One of the things that you may be taught as an Amway IBO is to have a goal. While having a goal in a good thing, I believe the context in which it is taught by Amway leaders is misleading. They want to motivate you to "go diamond" or perhaps some other achievement in the Amway business, but there is no specific means to achieve these goals and frankly, I do not believe that many IBOs or prospects understand what they are pursuing.

For example, one way that diamond leaders try to motive their downline is to show displays of wealth. They may show fancy cars or talk about the mansion they own and paid for in cash, or they may show you a fancy vacation or jewelry. All the while, these diamonds may be up to their ears in debt. Has a diamond ever showed anyone a copy of their bank account balances or a business tax return? While IBOs may claim that this is nobody's business, I beg to differ. In the REAL world of business, these are not uncommon practices. A close friend of mine who recently sold a franchise business not only gave copies on his bank statements, but three years' worth of personal tax returns to the eventual buyer of his business. It was to verify his claim that his business was worth buying.

So, for IBOs and prospects, what is your business goal? If it's to make $500 a month, has your "mentor" actually sat down to discuss this and to map out how this can be accomplished? What about setbacks? In the Amway business, the Amway reputation is damaged, thus achieving certain tasks may be much more difficult to conquer than you are led to believe? Is your upline actually helping your individual cause or are they simply leading you to purchase more tools? If your goal is not diamond, are you receiving the same help as others in the group? Did you know that your sponsor is supposed to help train you free of cost?

The big question though, is are you progressing towards your stated goal and are you on schedule to accomplish the goal and reap the rewards, or have you fallen into a trap of attending meetings and listening to standing orders and accomplishing nothing other than shrinking your bank account? If you have stated goals, there should be tangible and measurable ways to assess your progress (i.e. profits). If your upline starts to feed you rubbish about being a nicer person or that Amway saves marriages, then your upline is leading you astray.

Amway Creates (Debt)?

 One of the things I noticed is that many IBOs who support the Amway opportunity seem to be in debt. I know that being in debt is one of the reasons these prospects are drawn to the opportunity, because they believe that they will earn so much cash that their debts will go away. I remember seeing a presentation where the speaker touched on how people were in debt with credit cards maxed out. Thus, this business is for you because you can earn enough to pay off those credit card bills or maybe go diamond and pay cash for everything.

In my informed opinion, the speakers who promote Amway in this manner are unethical at best, because they will teach IBOs to live below their means, cut expenses, and reduce debt, only to turn around and have the IBOs spend their cash on tools. It's not really debt reduction, but simply redirecting an IBO's purchases towards things that benefits the upline. It is why I often wondered why a speaker would say it was okay to go in more debt, only to invest in their Amway business. I mean, debt is debt and if IBOs are to reduce their debts, they should also be cutting their Amway expenses and focus on selling products, which can result in immediate cash.

I also believe many diamonds to be hypocrites. I heard many of them speak about how diamonds pay cash for everything, including their homes. I find it quite humorous and very hypocritical of some of these speakers who were exposed as having their homes foreclosed. One of these speakers, Greg Duncan, a prominent triple diamond, apparently had filed for chapter 7 bankruptcy some years ago because he could not service his debts. This was public record in the State of Montana.

I also believe that many diamonds may be drowning in debt, more so than the downline that they teach. Why do I believe this? Because they portray lifestyles that are not sustainable on the incomes they have. Sure, a diamond may have a $250,000 income consisting of Amway payments and tools. But if anyone does the math and considers taxes and business expenses, these magical diamonds suddenly don't have much cash left over to be able to purchase mansions and sports cars. So how do they obtain these trappings? I believe many diamonds might be financing their cars and homes and may actually be in heavy consumer debt while trying to portray a diamond lifestyle.

Amway pundits may argue that hey, at least these folks don't have to answer to a boss and wake up early to go to a job. While that may be true, most job people don't have to stay up until 3:00 in the morning showing plans and having night meetings to motivate their downline. Furthermore, a diamond must have to live in fear that a scandal could tear apart their group or that a disagreement with an upline could get you cut from tools profits.

To summarize, I don't believe diamonds are that different than the rank-and-file IBOs. They get divorced, they have debts. They may have bigger incomes, but that is all relative. A man with a $50,000 a year salary could live comfortably and debt free while someone who earns $250,000 can be drowning in debt because they live beyond their means while the $50K man lives below his means. The evidence is there, diamonds live excessively and many flaunt wealth. In the book, the millionaire next door, Stanley and Danko say that people who flaunt wealth, often are not wealthy. Are you as an IBO, drowning in debt? Maybe you are simply following the example of your upline diamond? Maybe?

The System Scam?

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

It is simple. Amway reports that the average active IBO earns about $202 a month in gross income. This average includes diamonds and other higher end IBOs but excludes IBOs who were not active. If you calculated the median, the average would be much lower.

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

Thus, if the average IBO earns $202 a month but the same average IBO spends $250 a month on tools, the average active IBO is losing money each month, with lower-level IBOs (i.e. 100 PV) would lose more.

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

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

Instead Of A Job?

 What happens to many unsuspecting people is they join Amway thinking they will attain wealth and riches by "owning their own business", but in reality, they have basically become unpaid commissioned employees of Amway. You don't get health insurance, vacation, or any fringe benefits. You get to work unlimited hours and you get commission by moving products. You can leverage your commissions by increasing this unpaid sales force by sponsoring others into your downline.

Some people do succeed employing this method, but you will need to be an elite recruiter in order to get people to sell Amway products for no salary. You are also handicapped right from the start because past IBO behavior has soiled Amway's reputation in the US and Canada. This point is supported by the fact that Amway's sales appear to be growing the most in foreign countries and not in North America. Seems that everyone I know has been at one time, involved with Amway (and had a bad experience) or knows of someone who had a bad experience (i.e. tricked into attending a meeting, or deceived in some way about the opportunity or the products).
Even if you are a great recruiter, your likelihood of attaining Amway success (emerald or higher) is a tiny fraction of 1%. And for those who attain Amway success, they have great difficulty in sustaining that level. It is why there are hoards of "former" emeralds, diamonds and platinums.

You may hear about how Amway was found "legal" by the FTC or that Amway is #1 in online health and beauty sales. All of this may be true, but it doesn't change the fact that an IBO is basically an unpaid commissioned Amway salesperson. You absorb all the business expenses, pay for your own training, and you get to share your commission with layers of upline (more middlemen), some of whom do not help your business, and some who don't even know you exist. It's a great deal for Amway but not for IBOs. You move their products and absorb the expenses and in doing so and they pay out a commission. As for any awards or credits Amway receives, it's great for Amway, but you are an IBO - an independent business owner. You are not Amway.

Bottom line - if you can get people to work for free, you can find numerous opportunities to get rich that are much better and more lucrative than Amway. :-)

Is Your Diamond Rich?

 One of the things so many Amway IBOs and others do is assume that their upline diamond is rich beyond belief. At meetings, the speaker would be introduced as being in the top one tenth of one percent income bracket. While it may or may not be true, nobody ever questioned it, they just assumed it was true because people saw pictures of mansions and copies of 10-year-old bonus checks. Even I never went and studied how the diamond bonuses worked. Most people just assumed that the money would be huge at the diamond level. But looking back, I can recall some things that make me believe that the diamonds were cutting corners and needed their platinums working free at meetings and functions in order to maximize profits.

The diamonds in our group often did not stay in hotels when visiting for meetings, but in the home of another diamond or some lucky downline platinum. The diamonds rarely rented a car. Instead, a downline platinum or higher would be lucky enough to be the unpaid and uncompensated chauffeur for the weekend. The platinums basically were the doormen and ushers at the functions and in many cases, probably didn't even get to hear the speakers since they were busy working. Their reward for their troubles was "spending time" with their uplines.

The downline are basically unpaid volunteers. For example, ever see diamonds actually renting a moving van and hiring movers? I believe most of them had downline groupies who did the work for free, just for the honor of being near their upline. Just my opinion, but if these folks had mountains of cash, why wouldn't you hire movers, so your downline didn't have to use up a valuable Saturday or Sunday to do that work? That's like owning a chain of stores but having all of their stores closed. No products sold, no new recruits prospected. If Ray Kroc moved his residence, would all the nearby McDonald's owners close their stores to help him move?

Another things IBOs and prospects should note is that pictures of mansions, sports cars and jet skis doesn't mean someone is actually wealthy. Someone could have all those things on credit or rented after all. And many people who truly are wealthy, do not show off their wealth. It is possible that many diamonds live mundane middle-class lives on their income but need to portray wealth to lure in new IBOs. While your upline diamonds may act and look rich, how would you really know? I can take a homeless guy, clean him up and put him in a suit and a sports car and he would probably look like a diamond.

If your uplines are implying that they are so wealthy, ask them to verify some of the claims. I'm not talking about their personal income, but in business, verifying business income is very common. If you are being invited into the business and a business system such as WWDB, BWW or N21, you have every right to check your upline's credentials. Avoidance of the truth, or an answer such as "none of your business" should be a red flag. It is your business if you are being asked to join, invest your time and money, and follow upline advice.

Chasing A Dream?

 Every year, tens of millions of kids across the US and even other countries have dreams of playing sports. Some dream of playing professionally, some dream of playing at the collegiate level, some may have dreams of dazzling their high school peers. And this can apply to just about any sport, be it baseball, football, soccer, hockey, basketball, golf or whatever endeavor you can think of. As you progress to each of the next higher levels, the number of participants decrease. There are only so many professional teams, and so many college teams, while there are scores of high school teams all across the country. As each level gets higher, it is likely that better physical attributes and greater skills are needed in order to move on. 

I've heard some Amway supporters make comparisons between the Amway opportunity and how the higher levels are like the professionals and the rank and file are like the high schoolers. While I agree that there's only limited space at the higher levels, i think it's extremely important to note why the masses do not achieve the highest levels. In sports, you would need to have the motivation, the physical gifts, as well as the skills to achieve and excel at the highest level. Thus, people who are small in stature likely won't be candidates for the NFL even with a lot of motivation. Someone under 6' tall might have great difficulty in getting a job in the NBA. Of course there are always exceptions, but those exceptions are made up by perhaps, incredible "other" skills or leadership. Some athletes have a knack for being in the right place at the right time, or an intangible.  

So, what does this have to do with Amway? The connection is the massive amounts of Amway IBOs who never achieve even the break-even point. They may come into the program with dreams of financial freedom, or making enough to have a stay home wife, etc. Why do so few achieve even the lowest levels? In my opinion, the Amway business has too many barriers that prevent IBOs from succeeding. These barriers make it nearly impossible for anyone to reach the higher levels. These barriers include but are not limited to high prices that make many products a tough sell. Then you have the optional but vital training and functions that normally drain whatever profit the lower-level IBOs make. Even someone at 2500 or 4000 PV will net a loss if they need to travel by air to functions. You can also factor in some of the zany things previous IBOs have done such as tricking people into attending meetings, or not being accountable to downline, or by messing with your downline's money (bouncing checks).  

In the end, the masses of IBOs just do not possess the ability to overcome these barriers that can stop the charge of a bull elephant. It is why so many IBOs try hard and achieve nothing. While much effort may be expended, it looks as if these folks did nothing and quit. The reality is that most people who sign up were highly motivated but more likely found an impossible barrier and decided to do something else. I know of many former IBOs who went onto succeed in life after Amway. Many do not complain or voice complaints because they were involved in Amway with family and friends.  

So, in Amway and in pro sports, there are masses who want to achieve their dreams. In both cases, a tiny percentage might achieve the top levels. The difference is that athletes know that their chances are small. IBOs are often misled into thinking that everyone can achieve diamond and residual income, which is a myth. Also in pro sports, there is no scam where people have a proven training system that will ensure success if you work hard. In pro sports, it is proven that the elite make millions. Whereas Amway diamonds seem to shroud their success in secrecy, showing pictures of mansions to show off success. Also, athletes may not make the pros but may have benefited by getting a free college education. There aren't any stories of success in Amway for those who don't "make it", as far as I know. Are you chasing an impossible dream?

Mentors Or Crooks?

 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 a WWDB IBO blog. On this blog, I see all the same teachings today, that I heard as an IBO and some of the same claims such as buying homes in cash. 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 cross line 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 in my early months of the business but mostly broke even when I was at 4000 PV. Sadly though, my cross line 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?

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.

Buy Your Prosperity?

   One thing I can credit Amway diamonds with is coming up with the most bat sh@t crazy ideas that sound sensible to Amway IBOs but utter madness to anyone else.  One that I heard about was how you can buy your way to prosperity.  Buy your own Amway products and get others to follow and you’ll soon be on the road to early retirement and residual income.  In a pure business sense, that's insanity.  In what business to you buy your way to financial success.  That's just the selling point used to attract recruits, that you can buy your way to riches.  

Have you ever seen a store or business prosper when the major of sales are simply to the business owner and employees?   The answer is no because such a business does not exist.  It’s amazing that people actually believe that you can get rich buying from yourself.  But it works on the downline so the diamonds perpetuate the storyline.   And IBOs soak it in because it sounds so simple and easy to do right?

One thing I saw at a live function was the diamond telling IBOs to ask prospects if they like selling stuff and whether the answer was yes or no, your response would be “great, then this business is perfect for you”.  Of course, actual stories of significant retail sales were rare and my own experience suggested that sympathetic family and friends comprised most of whatever sales took place and I found myself at times selling items at my cost just so the expenses of moving 100 PV wasn’t all on me.  

The strategy of buying your own stuff seems to work because most people do not like selling stuff and especially not to friends.  But many will give it a run because they are hopeful that Amway will deliver the wealth that upline seemingly promises.  The sad thing about the whole this is that dreams of wealth is all you get and there’s very little success to speak of.  From function to function it’s the same old diamonds time and again.  

The diamonds might say they want downline success but they don’t.  They just want to keep replacing quitters with new members as long as they can churn in new tools and functions subscribers.  That’s the real game of diamonds and that’s why the emphasis of the tools and functions is recruiting new people into the game. It’s an elaborate scheme that prospects and new IBOs don’t see because they have Amway dreams clouding their thoughts.   Think about it, new diamonds means another person getting a cut of the tools and functions profits.  It's more profitable to just keep brining in new recruits who are the customers of the tools and functions scam.

You'll be told you can buy your way to wealth but it's just a big lie.

Upline Wants My Success?

 One of the things my upline leaders used to always talk about was how they wanted everyone to succeed. Looking back, I believe they were lying and simply wanted the faithful downline to keep spending money on tools whether they succeeded or not. Now I am not claiming that every single upline leader does this, but primarily the ones who run "systems", such as WWDB, N21, BWW, LTD and some others.

When I stopped and really thought about it, pretty much every piece of advice I received, I had to pay for. Voicemails, standing orders, functions, open meetings. I know these are supposedly optional, but in reality, they are a defacto requirement. Anyone with a "dream" is going to buy the tools because the leaders will tell you that you cannot succeed without tools. Ironically, the same leaders will blame individuals and cite personal responsibility for the failure of downline IBOs, even the ones who did everything they were told.

The leaders are edified and touted as having great business and financial acumen, thus not following their advice would seem foolish. Yet Amway defenders will try to claim that IBOs should discern the good and the bad and operate independently. It's a redundancy that many people do not see. Sure, a downline should not jump off a cliff because upline said they would pad their fall with a pile of cash, but many IBOs put in an earnest effort in Amway, only to fail because of the handicaps and reputation issues that Amway has. These IBOs are told they were lazy or quit too soon, or did not try hard enough. Yet the very few who manage to break thru are edified along with the system while ignoring the multitudes who do not make it.

The bottom line for IBOs and prospects to know, is that I believe most IBO leaders do not know you or care about you and your success. They are more interested in selling you websites, voicemail, standing orders and functions. They know that people will come and go and they are perfectly happy replacing quitters with new people, as long as the system tools keep flowing. I believe some of the US diamonds are now hurting as Amway is apparently shrinking in the US. I read recently of Amway downsizing some of their operations, seemingly confirming that US sales are down. Also to note, Upline leaders would have to share tool profits with new emeralds and diamonds, which is why I believe they do not want new success.

I believe that Amway, other MLM businesses, Kiyosaki, or real estate gurus all have very limited or rare success with their financial systems. Infomercials usually have a disclaimer that success is a "UNIQUE" experience. Amway is no different. But I believe in all of these cases, more money is generated in selling the system than by actually running the system. If not, success stories would be rampant and people would line up to sign up instead of having to be deceived into even hearing the pitch.

My Job Sucks?

 One of the ways that Amway diamonds would put down jobs was to toss in the buzz phrase that a job was simply trading hours for dollars. As if it were demeaning to have a job where you got paid for your time. I believe it's all relative. Being that many IBOs are young and maybe working in more entry level types of jobs, then yeah, your hour's wage might not be that great. If you earn say $10 an hour, then you might be struggling financially, and it may take time before your skills and knowledge increase to a point where your experience is worth more money. What if you had a job paying $1000 an hour and earned $160,000 a month? Is that a lousy deal trading hours for dollars? I don't think so! 

Conversely, having a business can be good or bad also. If you have an Amway business earning less than $100 a month and you spend $200-$300 on functions, standing orders and other training and motivational materials, then you are losing money. You would be better off working for free. That is still a better alternative than working a business where you are losing money. I think most people agree that a platinum group typically has a 100 or more IBOs. Thus, a platinum is in the top 1% of all IBOs. I have heard that the platinum level is where you start to break even or make a little profit, depending on your level of tool consumption. If platinums are barely making a profit, then the other 99+% of IBOs are losing money. How much is that worth per hour?

I think uplines cleverly trick IBOs into thinking that a job is bad. Trading hours for dollars, after all, sounds like some kind of indentured servant of sorts. But in the end, what matters is your bottom line. If you are an IBO with little or no downline, and/or not much in terms of sales to non-IBOs/customers, then you are losing money each and every month if you are attending functions and buying standing orders. Your 10-12 hours a week of Amway work is costing you money! But if you spend 10-12 hours a week, even at minimum wage, then you might be making about 300 to 350 a month gross income. After taxes, you make about 250 to 300. At least trading hours for dollars gets you a guaranteed net gain at the end of the month. You have money that can pay for your bills and expenses instead of the Amway business, which is simply false hope for most.

Uplines trick you into a "business mentality" where you think that working for a net loss is just a part of business. IBOs should realize that a business promoted as low risk and no overhead should be one where you can profit right away. Instead, IBOs are taught to delay gratification, or to reinvest any profit back into their business in the form of tools and functions, which results in a net loss. If that's the case, I would choose trading hours for dollars.

Remember, trading hours for dollars is not a bad deal if you are making enough dollars per hour. And even those who make less, are better off that those who "run a business" but end up with a net loss. It's all relative and hopefully, this message will help new or prospective IBOs who are being enticed to join the Amway business opportunity. Good luck to those with jobs and those with businesses. You can be successful either way. Remember that!

Upline Responsibility?

 One of the disturbing things I have noticed about Amway IBOs and IBO leaders and uplines is how they wall tell downline to trust them. To trust them completely as they have already blazed a trail. No need to re-invent the wheel. Just ride the coattails of your upline to success. The system is proven. Many IBOs take this to heart and put forth tremendous effort. Then when they ultimately fail, upline will shun them and tell them that the failure is their own. That they are personally responsible for failure. This is despite doing what upline advises, and often, that advice is advice that the IBO has paid for.

Now I am not talking about IBOs who sign up and do nothing or never place an order. I do believe however, that the fact that many IBOs sign up and do little or nothing brings concerns about how these IBOs were recruited, but I do not recall ever seeing an IBO do nothing and then complain that Amway was a scam or anything like that.

I have found, however, that many people who are critical of Amway and the systems, put forth much effort, did everything they were told, and did not find the success that upline promoted, or in some cases, guaranteed. My former sponsor was still active; last I heard and has been in Amway for over 25 years. I do not believe he has ever gone beyond platinum, and I know that he was never a Q12 platinum. Some Amway apologists might see being a platinum as a bonus, but when you are hard core sold out to the systems, platinum is a break even or make a small profit business.  Dedicated hard core platinums can lose money, depending on business expenses.  Factor in that time spent by husband and wife and these folks who are breaking even or making a fraction of minimum wage are not spending their time and investments wisely IMO.  Is this the dream that will allow you to buy mansions with a cash payment?

What is also disturbing is how people will tout the system as responsible for any success but hide the vast majority that the system doesn't help. Sure, some will succeed in Amway, but for every success, there are hundreds if not thousands who fail. And if you consider diamond as the benchmark of success, the failures could be in the tens of millions. As I said, some succeed, but very very few in relation to the number who try. Going diamond is probably less common in the US than winning the lottery. With the odds so stacked against you, looking for an alternative means of making a dollar seems wise.  But is Amway a good way to make an extra dollar?  It seems not.

Succeed and the systems and upline take credit, but fail or quit and it is your own responsibility. Are these the kinds of leaders or mentors you want advice from?

The Numbers?

 One of the things Amway IBOs are taught is to ignore facts, or to ignore numbers. I believe this is because the numbers are not pretty when you take a business-like approach to the math behind the Amway business, for most IBOs. It is why upline teaching often "evolves" into things such as Amway saves marriages, or Amway makes you a nicer person, or that Amway is not about money, it is about friendships. That is a load of garbage. Business is about making a profit. If you hear some of these lines from your upline, it should be a red flag. Upline may also feed you other deceptive lines such as an IBO being successful because they showed up at a function, or because they just signed up for standing order. These are all just false lines to encourage an IBO who is not making money.

When you take a good look at the Amway presentation, the majority of IBOs are at the 100 PV level. At that level, they are spending about $300 monthly to reach 100 PV and for their efforts, they receive approximately a $10 check from Amway. Most IBOs will be encouraged to participate in some kind of system, often consisting of voicemail, websites, cds, books, seminars and other meetings. MOST IBOs will not recoup enough cash to cover any of these expenses, let alone all of them. At a glance, the system expenses may appear nominal such as $6 for a cd, $6 for an open meeting, $100 to $125 for a major function, $12 for a book. It is how upline gets you involved, and then after a while, an IBO starts to notice the negative cashflow and then a tough decision needs to be made. Either quit and cut the losses, or press on hoping that the system will eventually deliver on its promises.

What most IBOs don't notice, is that less than one half of one percent ever reach platinum. A fraction of one percent! And in many cases, platinums might break even or even suffer losses! So why would IBOs want to work so hard to reach platinum? They have less than a 1% chance of reaching that level. They have a tiny chance of maintaining that level, and they are still unlikely to earn any significant income at that level. A study done by an attorney general in Wisconsin (Bruce Craig) revealed that platinum level IBOs averaged a net loss of about $900 annually. While Amway defenders will decry that the study is a bit dated, I will say this: The basics of the Amway business has not changed since that study was done, AND there are actually more system expenses today than there were back then, thus platinums may actually be losing more money annually than before. While not all platinums will lose money, I believe hard core dedicated platinums would stand to lose money.

As an IBO, I hope you are tracking your expenses versus your income. Most IBOs will see a negative cashflow month after month. Even though the Amway business is often promoted as low or no overhead, the system expenses (overhead) eventually begin to add up. Beware and please follow the numbers.

Negative Cashflow?

 One of the things I am hearing about right now by Amway supporters is the concept that Amway pays you to shop there. The problem with this statement is that many IBOs see this rebate but do not calculate the fact that you can still have a better bottom line simply by purchasing a product elsewhere. For example, if Walmart started some kind of cash rebate program, would you quit Amway and shop at Walmart?

Then One of the things I am hearing about right now by Amway supporters is the concept that Amway pays you to shop there. The problem with this statement is that many IBOs see this rebate but do not calculate the fact that you can still have a better bottom line simply by purchasing a product elsewhere. For example, if Walmart started some kind of cash rebate program, would you quit Amway and shop at Walmart?

Then when an Amway supporter is cornered with this information, they will switch gears and start to defend quality versus price. It's all very predictable.
Honest question for IBOs. Why do you use KATE instead of the Amway voicemail system? Amway pays you to shop there, your upline profits from and does not pay you to use KATE.

One of the biggest problems with especially new IBOs is they ignore negative cashflow. And I cannot really blame them. They are usually sponsored by someone they trust, and they are often taught to ignore facts or taught that they are investing in their business, just like a real business, even though when recruited, they are told little or ZERO risk. Thus an IBO who intends to make a profit will generally get set up with a website and some other materials. While the cost may not be exorbitant, these few materials already exceed a new IBO's income unless they actully go out and sell some goods or are able to sponsor downline who sell and buy products. And the more dedicated an IBO is, the greater the chance is that the IBO's negative cashflow will be larger. When you start to add in standing order and functions, the cashflow gets more and more negative and there are many testimonies of massive debts built up by IBOs in a few years or less.

What's ironic is that many IBOs incur these debts at the advice of their upline, or if you will, "mentors". Many uplines will teach IBOs to "never quit". It is my guess that uplines will make blanket statements like never quit without knowing an IBOs circumstance. Just as a statement like you "need" to attend a certain function, or you need standing order. No assessment of an IBO's business or personal circumstances. It appears that uplines are simply interested in making a sale for their BSM business. You may ask why a diamond should assess a downline's business before issuing these statements. I ask why downline should call them "mentors". In the meantime, these downlines suffer negative cashflow from their Amway business. Ironically, some upline teaches that "insanity is doing the same thing over and over and expecting different results". Attending functions and listening to standing orders while losing money each month is that same insanity. When an Amway supporter is cornered with this information, they will switch gears and start to defend quality versus price. It's all very predictable.
Honest question for IBOs. Why do you use KATE instead of the Amway voicemail system? Amway pays you to shop there, your upline profits from and does not pay you to use KATE.

One of the biggest problems with especially new IBOs is they ignore negative cashflow. And I cannot really blame them. They are usually sponsored by someone they trust, and they are often taught to ignore facts or taught that they are investing in their business, just like a real business, even though when recruited, they are told little or ZERO risk. Thus, an IBO who intends to make a profit will generally get set up with a website and some other materials. While the cost may not be exorbitant, these few materials already exceed a new IBO's income unless they actully go out and sell some goods or are able to sponsor downline who sell and buy products. And the more dedicated an IBO is, the greater the chance is that the IBO's negative cashflow will be larger. When you start to add in standing order and functions, the cashflow gets more and more negative and there are many testimonies of massive debts built up by IBOs in a few years or less.

What's ironic is that many IBOs incur these debts at the advice of their upline, or if you will, "mentors". Many uplines will teach IBOs to "never quit". It is my guess that uplines will make blanket statements like never quit without knowing an IBOs circumstance. Just as a statement like you "need" to attend a certain function, or you need standing order. No assessment of an IBO's business or personal circumstances. It appears that uplines are simply interested in making a sale for their BSM business. You may ask why a diamond should assess a downline's business before issuing these statements. I ask why downline should call them "mentors". In the meantime, these downlines suffer negative cashflow from their Amway business. Ironically, some upline teaches that "insanity is doing the same thing over and over and expecting different results". Attending functions and listening to standing orders while losing money each month is that same insanity.

The 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 maksome 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 peope 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 ainland. 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 sign up fee. The cds, books, voicemail and functions are not sold or run by Amway. And these expenses can be very significnt 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 sign up 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.

Math And The Systems?

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

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

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

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

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

The Math?

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

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

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

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

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

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

The facts speak for themselves.

The Road To Riches?

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

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

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

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

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

Amway Or A Job?

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

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

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

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

No Debt?

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

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

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

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

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

Upline Wants My Success?

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

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

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

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

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

Behind The Curtain?

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

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

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

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

We Don't Make Money Until You Do?

 One of the things upline used to say in meetings was that they (upline) don't make any money until you (downline) do. Of course, we know that is a full blown lie in most cases because once you register (many groups have a starter kit including products), upline makes some money. Once you purchase a cd/audio, a book, or pay to attend a function, upline has also made some money off of you.  Not sure why they make such bold faced lies that can easily be dispelled with a little common sense and math.

It would appear that most uplines will try to lure prospects into Amway by showing them the best-case scenario of going diamond or higher, and all the alleged trappings available at the diamond level such as mansions and fancy cars. Once they get a prospect excited about the possibility of not working while cash rolls in, they then pitch their "foolproof" system of voicemail, cds/audios, standing orders, books and seminars. Although it is VERY RARE for any IBO to reach a level where they can net a profit, much less buy mansions, the upline will convince you that these goals are only attainable through the system teaching.

The sad reality is the upline makes money if you succeed, fail or do nothing, as long as you continue to purchase products or tools, or just about anything from them. However, you may be edified as being a committed IBO. It is why they may tell you that the most important person to get to the function or meeting is yourself. In an open meeting, there really is no point in attending if you have no prospects as your business cannot grow as a result of your attendance, but your attendance costs time and money.

If you as an IBO or a prospect really observes carefully, you will find many activities that will cost you time and money and will not result in your business volume growing. For example, reading a book might be good for you, but it is a non-income producing activity. Attending an open meeting without prospects is another good example. Listening to standing order is another example. With all of these activities, an IBO is expending resources and not getting a tangible business return. Frankly the worst investment is attending an out-of-town function where your expenses are great while your business is left unattended to at home with no growth in downline or in product volume.

Don't buy it. Your upline makes money from you when you buy products or tools, whether you do a lot, a little, or nothing.

Sucked In?

 If you have ever sat through an Amway presentation and the follow up teachings as I did, you can get a clear picture of how the uplines slowly suck people into the system. The speaker will be introduced as a picture of success. Possibly introduced as being in the top 1/10 of 1% in income (But with no proof). They will talk about how taxes, insurance, and inflation eat away at your paycheck. More than likely they will say they suffered the same way until they figured out how to defeat these issues by making more money. Of course, they will eventually drop the "A" bomb on you and say it's Amway. Very likely they will say that you should not care what it is if it gets results.

You are then shown the plan, and many people think that 2-5 years and "finding six" is something very manageable for the results they promote (walking the beaches while residual income flows in). At the very least they say, you will make some money and save some money. Who can argue with that kind of logic? They will also likely mention that Amway is low risk or no risk with little or no start-up costs. Again, how can you argue with that logic?

You finally convince yourself that you can do this. You sign up and you are likely told that it is important to get some tools because after all, a carpenter can't build homes without a hammer and saw and that any business owner would have to make some investment into their own business. So now because of the tools, you are operating at a loss. You may then be told that business owners normally operate at a loss for years and that it might also be wise to channel your bonuses back into your business by purchasing more tools.

Before you know it, months or years may pass before you start to realize that you are on a treadmill. You keep walking but end up going nowhere. Then your upline may tell you that the business is not about money but more about making lifelong friendships.

In my opinion, this whole system is a cleverly designed systematic way for uplines to slowly drain your resources and making you think that you are successful despite showing no profits. Your upline may edify small things like showing the plan or making a sacrifice to attend a function. Sadly, you will rarely see someone edified for actually making a net profit.

It's a slow process, but most people slowly get sucked into the system, just like quicksand. I hope IBOs and information seekers are able to recognize the scheme if and when it happens to them.

Million Dollar Business?

 So many Amway IBOs mistakenly believe they will join the business, 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 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.  I saw it firsthand as an Amway IBO myself many years ago.

Most IBOs will never sponsor a single 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 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.  Some IBOs want it so badly that tears run down their eyes at functions and they get emotional over what they think they can almost grasp but never achieve.

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 business run by upline. Unfortunately, there is no unbiased documented evidence that the tools do anything other making your upline wealthy.

And I might add that upline (in my days) completely lied and said nobody made a profit off of tools and functions.  But once the internet made information readily available, upline could no longer tell this lie so they changed the narrative to "profits are made", but not much, and IBOs can eventually get a share, although specific details, as far as I know are never disclosed.   Just the fact that the story evolved from "no profits are made" to what it is now shows dishonesty and a lack of integrity by these upline leaders that so many IBOs trusted with their financial futures.

Avoid All Negatives?

 One of the silly things taught by uplines is for IBOs to avoid negative. This was commong practice when I was an IBO, and apparently, still taught by some leaders and groups. Don't read the newspaper, don't watch TV, and avoid people in general, who are negative about the Amway business. My upline would say that the world is too negative so our minds needed to be filtered with positive thoughts so that we can flourish in the Amway business. I believe this is one of the reasons why some people associate Amway and the AMOs (Amway Motivational Organizations) as cults. Tell people how they should think and then bombard them with only happy thoughts about Amway. Everything else is "negative" and should be filtered out.

Sadly, many IBOs buy into this and start avoiding family and friends simply because they may not view Amway in a positive light. Certainly, some IBOs don't shut out family and friends, but it seems that enough of them do, at least while they are involved in building a big business. It was my experience and I still see evidence that this is not uncommon practice even today. If these AMOs were churning out new and sustainable success stories, we would probably not be talking about this but instead, IBOs and prospects get used and abused and spit out by the system, all under the guise of being mentored by uplines. Most IBOs, even those who put in an earnest effort end up with a net loss, despite their dedication to the system and adherence to upline advice. I don't know of anyone who has been able to name more than a dozen new diamonds from the US in the last 10 years or so. It sure looks like Amway in the US and Canada is shrinking, save for some pockets and areas where there is the appearance of "growth".

I would point out the functions as evidence of shrinkage. My former sponsor told me of an FED where IBOs filled the (at the time) Seattle Kingdome. 50,000+ IBOs in attendance. I also attended a family reunion function at the Rose Garden in Portland where there were 15 - 20,000 IBOs in attendance. Dream Night was held in venues that sat about 2500 people and more and more, we are seeing smaller venues for these types of functions. Maybe people are simply more aware of what being an IBO entails and simply avoid it? Maybe it's just a coincidence?

But hopefully, someone out there who reads this will understand that avoiding all negative is a silly thing to teach. Unless you live in some Utopian society, there will always be some negative. That's just life. Avoiding the news or only taking in positive can make you apathetic. How would you be able to vote or know what the current events are? Do you rely on your upline for this? Are you living in an Amway/AMO world where you only associate with IBOs and "happy" people? Do you argue and attack opposing views? If you're about avoiding negative, you should take this message to heart and seriously think about what you are being taught by your (well compensated) mentors.

Good luck in whatever you decide.

Real Friends?

 You hang out with friends, generally people you like and have similar interests. You have good and bad times, but your true friends are there for you when you need them. You move residences, your friends are there to help you move. They may play a round of golf with you, or watch some sporting events, dinners, backyard barbeques, etc. These are folks you will likely end up retiring with and enjoying your golden years.

But suddenly, you get enticed to join Amway. You see the "chance" to get rich, with a shortcut (not get rich quick, but a "shortcut"). You sign up and your sponsor is your new "best" friend. Most of the people you enjoyed being with think Amway is a questionable venture to get involved in. Suddenly, because of what you have been told or taught, you view these same nice people as "broke" or "losers", simply because they do not share the same ambition of untold wealth working 12-15 hours a week. Suddenly, you friends become prospects, or people you want to sponsor so you start recruiting them. Some may join, but most won't. Suddenly you are immersed in recruitment meetings, functions, and avoiding "negative", which is people and events that do not support your Amway business.

Now you are missing birthday parties, barbeques, and other social events. Your social events are now recruitment meetings, seminars and Amway business related events. You are taught that these events can be put off and your gratification delayed. You can do whatever you want when you go diamond. (Even though there me be only one (1) diamond out of every ten or twenty thousand IBOs) Your dedication will pay off right? Sadly, for most people, even very dedicated people, all they will see is losses on their yearly tax returns, mainly due to the purchase of cds/audios, books, voicemail and function tickets. But these are your "friends" right?

Here's my take on it. Try missing a few meetings or functions. Stop buying cds/audios and see how many "friends" remain from the business. It is likely that your upline will claim that you walked away from the friendship by slowing down on the "system". If that happens, then you have conditional friends, or fair-weather friends. They are your "friends" while you are pursuing the same cause. They are your friends when you are attending functions. Are they there for you in bad times?

A short while after I attended my last function (I was still an IBO, just not a business builder), my dad passed away. Not a single one of my IBO "friends" bothered to attend the memorial service. Not a single one of my IBO friends called or dropped by the home to pay their respects. All of my "real" friends, who saw through the AMO smoke and mirrors called to talk to me and/or attended the memorial service. Are your IBO friend's conditional friends? Mine were.

Money For Nothing?

 In my opinion, Amway is a pyramid. They have not been found illegal, but still operate a product pyramid. The reason why they remain legal, apparently is because they do not pay anyone for directly recruiting downline and they claim to sell products to actual customers. But most everyone has been, or knows someone who was recruited by a zealous Amway IBO. The emphasis of most active IBOs is on recruiting and much of the teaching by upline is on techniques to recruit and/or how to talk to people without tipping their hat to reveal the Amway name. Most IBOs are not very good at this and they stick out like sore thumbs in many cases. It's also comical when uplines teach crazy antics, like how some IBOs use to deny that Amway and Quixtar were even remotely connected, or if anyone remembers the "perfect water" fiasco a number of years back. 

One of the reasons IBOs use to justify their involvement in the pyramid is that they can earn more than their sponsor. While that is true, it is only because everyone below the emerald or diamond level is basically expendable, or a slave in the pyramid. There are many many IBOs who achieve fairly high levels who quit, or had upline wreck their businesses. Thus even platinums are expendable to upline. In fact an upline might make more money by removing the platinum. For new IBOs or recruits, do you really believe that you are going to ever surpass your current upline diamond or higher? If you believe that, you are sadly mistaken.

And for those who dream of achieving diamond and walking the beaches of the world. How do you think you can ever achieve that? You don't get something for nothing unless someone gets nothing for something. In order for you to receive income for little or no efforts, your downline IBOs must keep purchasing products and replacing IBOs who quit. If your downlines cannot keep up with the attrition rate, your business will collapse in a hurry. Come to think of it, if a diamond can walk away and collect a large income forever, why hasn't anyone done it? I mean we still see crown ambassadors still busy working functions or dying on the job and I don't know of any who walked away to spend their lives jet setting on the beaches of the world.

The sad reality is that you see new faces at meetings and functions, just as often as you see familiar faces disappear. With that kind of attrition rate, you may have to work even harder at the higher levels just to keep your business status quo. In Egypt, the slaves built the pyramids. Do you have enough slaves? What many Egyptologists find amazing is how the Egyptians were able to motivate the slaves to keep on going, doing backbreaking work all of their lives. The same can be said of a diamond level business (or higher).  

Analysis Of CORE?

  Breakdown of CORE and why it doesn’t work in my informed opinion.  Here are the CORE steps. Some groups may have variations of CORE, but this is generally what many groups use:

1 - Show the Plan (10-15 per month)
2 - Retail the Products (10 customers @10 PV each)
3 – CDs/Audios
4 - Books 
5- Functions (attend all)
6 - Accountability 
7 - Counsel with Upline (Be teachable!)
8 - Buy 100% of your own products 
9 – Communikate (voicemail)

Many upline will tell you that your success is nearly 100% guaranteed if you follow these steps for 2-5 years. Some Amway enthusiasts will tell you that 6 months of this activity will nearly assure you of a platinum level business. Certain steps are within the IBO’s control, such as reading every day and listening to cds/audios and attending functions. It is also easy enough to be accountable, counsel with upline, buy your own products, and use KATE (voicemail).

Here’s where an IBO’s effort will break down. Showing the plan and retailing products. And remember, if you cannot do these steps then you are not considered “CORE” and your upline will likely tell you that it is your own fault and that you simply haven’t been CORE, therefore you did not achieve success. There is some truth in this but let me expose the system in a different angle.

Amway has a spotty reputation in the US. I don’t think anyone can dispute this fact. Therefore, for the vast majority of people, being able to show the plan 10-15 times per month is a nearly impossible task. If you are able to do this, you are a really good salesman or a good liar, or both.  In this scenario, the IBO is already successful, but not because of CORE, but simply because the IBO has the gift of being able to convince people into seeing the plan. But for many IBOs, they may contact hundreds of people and not be able to get anyone to see the plan. Even IBOs who follow upline advice on how to contact will probably not be able to show 10-15 plans per month. Thus this IBO, who is doing the work, will not be able to succeed. The system will blame the IBO, but the reality is that the IBO has too big of a disadvantage to overcome.

Secondly, with high prices (on average) and with a spotty reputation, most IBOs are unable to retail products. Amway itself has admitted that less than 4% of Amway products are sold to customers (non-IBOs). Thus, most IBOs are unable to sell products, therefore they are not CORE, therefore upline will blame the IBO for failure.

What if an IBO contacts 1000 people and cannot get 10 people to see the plan? Upline will claim that IBO is not CORE and therefore it is personal failure of the IBO. IMO, the only reason why upline can claim that CORE works is because in order to do the CORE steps consistently, you have to already be at a certain level of success. The vast majority of IBOs cannot and will never be able to reach that level.

That is the myth and the deception that many uplines will use to attract recruits. That each IBO can do the CORE steps. When only a fraction of 1% ever reaches the level of platinum or higher, the numbers strongly support what is written here. Apologists are welcome to try and prove me wrong, but they can't. :D