Free Enterprise Day?

As an IBO, I attended a function called Free Enterprise Day (FED). It was held in a convention center in San Diego. I remember being excited when attending, and participating in the hype. But looking back with an objective eye, I can honestly say that it did nothing to help build my business. Sure, we got some motivation out of it, but being from Hawaii, a mainland trip in October, plus rental cars and hotel costed me over $1,000. It simply is not worth the expense versus what my business got out of it. I would rather have enjoyed a vacation somewhere else.

Also, the Amway business as an IBO is not free enterprise. An IBO is a commissioned salesperson with no guaranteed salary and no fringe benefits. Hard work does not equal success jus as in other sales occupations. It is possible to work very hard to receive zero dollars. What's more, much of an IBO's business expenses are not for business but for training and motivation. An Amway IBO's duties are to sell goods and to sponsor downline. Basically that's it in a nutshell but IBOs have fooled themselves into thinking that they are real business owners with real expenses. If only more IBOs knew this, they could actually make a net profit (without tools) and they would be motivated by net monthly ptofits.

Sadly, upline leaders lure their downlines into thinking that IBOs are engaged in free enterprise when they are not. At best an IBO is a middleman distributor and at worst, a commissioned salesperson. That is not free enterprise. What is also sad is that I did some research about renting space or convention centers and these can be rented or leased free or even cheap if the convention will bring many tourists to town. Go check for yourself. If it is free enterprise, it is your upline's tools business that is free enterprise. Sadly, for IBOs, free enterprise day is not free.

All Means All?

One of the things Amway defenders will spout is how tools are optional in the Amway business. While Amway says this, many Amway AMO leaders do not. One of the things I remember hearing was how an IBO "needed" to attend "all" functions. So many IBOs asked the upline questions such as what if by brothers is getting married and the wedding is on the sAme day as a function? Or what if my kid has a soccer game or an event that was scheduled on the same day as a function? The answer from upline was simple. "All means all".

So upline may teach you that God is #1, spouse is #2, kids #3, job #4 and Amway is a distant #5. That's what they said but that isn't what they meant. Anytime there was a conflict with anything, I heard the same thing: "all means all". Meaning that one needed to attend all functions. Amway defenders are quick to jump in and claim this doesn't happen or that they have never heard it, yet I continue to see stories and testimonies indicating that this is still happening in most of not all AMO groups. Sure some upline might be more lenient than others, but in the end, it seems that most uplines want their downlines to attend all functions, regardless of whether an IBO is profitable or not.

I recall even an IBO who had worked hard and was not profitable. He was given the same answer about "all means all". Some upline want you to believe that hard work equals success, but in Amway, hard work doesn't guarantee success. And I believe it is because an Amway IBO is basically a commissioned salesperson amd in that kind of business, hard work can go unrewarded. It is not a matter of working hard, and even working hard and smart can go unrewarded at times. It is because Amway's prodcuts are difficult to sell and Amway IBOs previously unthethical behavior makes it hard to find people who are interested in Amway. Thus even finding someone willing to see the Amway sales plan is a great challenge.

What does your upline say about attending meetings and functions? Do they advise you to pick and choose the ones you can afford or do they tell you that you should attend "all". Do they look at your business profitability before advising you to do they ask you to trust their guidance and leadership? Do they also advise you to buy other tools in the same manner? That is advising you to be on voicemail or standing order without knowing about your business parameters? Do they really want your auccess or their own? Keep in mind that some upline make much more money from tools than from Amway. What say you now?

Beware Of The IBO Expenses!

Many uplines will use slightly deceptive recruitment tactics when getting new people to see or register into the Amway business. One of the common things was how joining Amway has very little risk, no or very little overhead. This is true, if an IBO is not involved in any of th system related training. However, it is the goal of many if not most uplines to get as many IBOs involved in the system as possible. This is probably because selling standing orders, voicemails and seminars has a higher profit margin for some uplines than the actual movement of Amway volume. So some newbies might join thinking Amway won't cost them much, only to find out that 100 PV might run them more than $300. They may not be aware that standing orders and functions never end and can add an additional cost of up to several hundreds of dollars more. Uplines will then justify the expense by saying the IBO is investing in his/her business.

New IBOs, and especially IBOs who are single should seriously think about the cost of being a business building IBO before joining. Many or most prospects don't know that building an Amway business using system tools and "coaching" can cost them up to$500 or more each month. A single person more than likely cannot possibly consume 100 PV worth or products on a monthly basis unless they almost exclusively consume XS drinks and Nutrilite vitamins. And secondly, how many singles or prospects were consuming cases of energy drinks and vitamins ($300 monthly) before being presented with the Amway business? How many people were willing to fork out hundreds of dollars for a weekend function that may require airfare and hotel stay? I don't think too many people like this exist. But I believe they do so because they have been sold a dream of financial freedom, of early retirement and not having to work a job anymore. But the evidence would suggest that once the dream disappears or reality sets in, how many (former) IBOs continue to purchase Amway products and attend seminars?

I know of many former IBOs and I don't know of any who purchase Amway products on a regular basis and I don't know of ANYONE who has ever forked out money to attend an Amway/AMO function after they stopped being an IBO. Amway's numbers bear out this claim as there is very little sales to people who are not IBOs. The IBO salesforce is responsible for consuming the lion's share of Amway's products and services. I myself have purchased an Amway product or two since I left the business. But I did so only to humor friends who were still in the business. They have all since quit. It is very reasonable to conclude that once the desire to build the business stops, the desire to purchase Amway products also stops.

Most eager young and motivated people who sign up often do not realize that these IBO expenses exist. While Amway acknowledges that these tools and systems expenses are optional, the uplines who promote the tools may suggest that it is insanity to attempt to build an Amway business without the tools or strongly encourage new IBOs to partake. A common statement was that we "needed" to be at the next function no matter what. Missing it would set your business back six months. New IBOs and prospects don't know better so they will often conform. Sadly, there is ZERO unbiased evidence that the tools and seminars do anything to increase IBO volume and/or the sponsorship rate. In my informed and experienced opinion, the tools are ineffective and the vast majority if IBOs would be better off handing their upline a monthly check for $100 and not building the business or buying any products.

IBOs and information seekers should be awar of these potential IBO expenses and determine if the expenses would be worth your while. Keep in mind that someone upline profits handsomely from the tools, even if you do not make a cent from your Amway business. You should have your best interest at heart, no matter what your upline tells you.

An Amway Business Or A Joke?

I find it sad that many uplines will ask/demand loyalty from their downline and then lead them to run a joke instead of a business. Many IBOs are young, motivated, hard working and simply wanting more out of life, but some unethical uplines exploit their downline and basically suck the life out of these IBOs while making the IBOs think they are running a business and succeeding. Because many new Amway IBOs have little or zero business experience, they tend to trust upline and will do as they are told because they don't know any better and upline will portray themselves as wealthy and knowledgeable even if it may or may not be true. (Some diamonds had their homes foreclosed and a prominent triple diamond was in bankruptcy proceedings)

One of the things many groups teach their IBOs is to "buy from themselves". Many people do not like or are not good at selling products, thus many groups tell their IBOs to be their b own best customer, and in some cases, the IBO is their only customer. Those who run business this way might be running an illegal business because the only way to generate profits is to continue to recruit downlines who will then allow you to generate more volume, provided that these new IBOs purchase their own goods as you do. Given Amway's generally uncompetitive prices, it's no wonder that most IBOs have trouble maintaining sales to non IBOs, save for some family and friends. Even IBOs who claim they focus on selling do not appear to have more than a handful of non IBO customers. (How many non IBOs would pay nearly $80 for a month's supply of Amway's famous double x vitamins?)

Another thing IBOs are taught is that the business is not about money. It is making friends and becoming a nicer person that is important. Some groups such as WWDB apparently teach that their involvement with WWDB or Amway can save marriages. Oddly, these claims are made even when some of their leaders are divorced themselves. I read on the blog of a WWDB IBO who says that the US has a 60% divorce rate while those in WWDB have a 2% divorce rate. This is completely fabricated information and I heard it as an IBO 12 years ago but it is apparently still taught today. Amway defenders like to claim that critics are outdated but the evidence supports the claim that things are more the same today than not.

Another thing many IBOs may be taught is that all of the support materials they purchase are tax deductible. That is not necessaily true. The materials have to be used to help you to increase your business. If you are attending functions and buying standing orders, the IRS may not see it as a legitimate tax deduction unless it is resulting in increased sales and profits. If not, the IRS may deem that you have an Amway hobby and not a business. I laugh when IBOs talk about how great their business is doing and then talk about the great "tax return" they received because of their Amway business. The joke is on them but they sadly do not know it.

So IBOs, are you tracking your income and expenses? Are you realizing profits as a result of the tools you are purchasing or are the tools the very reason you see losses month after month? Sit down and think objectively about what is written here. Are you running a legitimate business or a joke?

Chasing The Dream?

One of the cruel things done by some uplines is to fill starry eyed Amway prospects with dreams that they know will go unfulfilled. I have heard statements from some former platinums and higher who mentioned that some upline actually think of their audience as a bunch of suckers chasing a dream and making them rich by purchasing standing orders and function tickets. A common dream is for folks to retire before the age of 30 and to walk the beaches of the world. Others dream of mansions, sports cars and other trappings of wealth.

Sadly, the cast majority of prospects and IBOs will never get close to achieving anything they dreamed of when they first saw the Amway plan. Most IBOs would have a better chance of attaining wealth by purchasing lottery tickets instead of trying to build an Amway diamondship. Amway defenders such as IBOFightback like to jump in and squawk that the Amway business is not a game of chance like the lottery. While that is true, that makes things much much worse. Let me explain. In a lottery, you simply purchase the tickets and you wait to see the results. The results are completly out of your control. The vast majority of lottery participants will end up losing money while a few lucky ones will win. The reason I feel that the Amway business is worse is because it is not a game of chance. Many of the steps of CORE, are within the control of an IBO and even with much time and effort spent by many business building IBOs, the end result of all that time and effort is basically the same miserable result as a lottery. Many many people participating but very few end up happy. The difference is that lottery players genreally don't expect to win. Conversely, many IBOs are motivated and hard working, and will put in a fair effort, only to fail and worse, to be blamed for their failure despite doing everything their upline advised.

There is nothing wrong with having goals and dreams. Everyone should have something they are aiming for. But it seems cruel to promote dreams and goals at other's expenses when you really have no means to help more than a select few out of thousands or possibly millions of people to succeed. Yes, Amway is not a game of chance but the reality that long term and significant Amway success is about as common as someone hitting the powerball lottery. The rest of the IBOs who attempted to build a business end up quitting and fading into the sunset. Most will not complain as it is common to be sponsored by friends and family.

In the end, most people are simply chasing a dream that will never come to be. It's a sad situation because as I said, many prospects and IBOs are nice, motivated and hard working people. But in all walks of society, people can be fooled. I believe the upline leaders are simply getting their downline to chase dreams that will never come to pass. I challenge IBOs to look at their business financials. Do you have a net gain at the end of the month? If not, what dreams can you achieve with a loss of income?

How Upline Passes Bad Advice Downline?

Based on my personal experience, and based on having read numerous acconts from other former IBOs, it's pretty clear that the higher uplines, absolve themselves of issues and problems by having others do their dirty work. While some leaders are bold enough to make dumb statements on stage, many uplines will have their "eagles" or platinums do their dirty work, which is to pass bad and often self serving advice to their downline. Advice that will help them (upline) to profit directly from the losses suffered by downline.

For example, a diamond may stand on stage and talk about the merits of getting out of debt. Now getting out of debt is a good thing and nobody should get caught up in credit card debt and other piles of debt. But so many times, I sat in meetings where the group was told they needed to be at the next funtion - no matter what. Do whatever it takes to get there, even if it meant selling personal belongings. Ironically, the solution to getting to the next major function did not involve selling Amway products. So many IBOs made sacrifices of time and money to get to the next function, but their business did not experience any growth in volume or downline. I saw many crossline IBOs attend meeting after meeting and function after function without any downline. They faithfully spent their time and money chasing a dream based on lies by the upline leaders. Our group was told that upline made zero profit on tools. While some groups now admit that profit is made on tools, there is still a lack of transparency about the tools profits and as far as I know, there are no formal written agreements with regards to the tool profits.

I also recall our platinums having platinum and above meetings while we were at major functions and it seemed that the platinums always had something to teach the group that was contrary to what we had just heard on stage and the platinum would tell us that he had the freshest information from the meeting. It's like the platinum was just a henchman for the diamonds and carried out their dirty deeds. Another example is how the diamonds taught vertical alignment where God is first, then your spouse, your kids, your job and in 5th place was your Amway business. But anytime an event such as a friend's wedding or an anniversary dinner or your kid's soccer game conflicted with an Amway event, the group was told "attend all meetings". All means all, is what our group was told. That is directly contrary to the concept of vertical alignment. In fact, the Amway IBOs became less useful to their communities and churches as they are constantly attending meetings and functions and unable to serve in other capacities. I also wondered whether the Amway business and tools consumption took away their abililty to tithe and give to the local charities. Our upline would tell us to go diamond and then send in $10,000checks as if that made it okay not to serve others and help the needy.

It is my informed opinion that this still goes on today, despite the claims of Amway appologists that my experience is twelve years old. There is ample evidence suggesting that very little has changed from 20 years ago. In fact, many of the leaders from my IBO days are still teaching unethical things to this day. Many Upline passes bad advice downline, but they do it in sneaky ways such as having their downline leaders pass the information on. This is also how Amway itself can skirt some of their issues, as IBOs are not Amway employees, they are "independent". But most people in North America now know the truth and hopefully this article shines some light on that truth.

Amway - The Bottom Line?

In my point of view. one of the most critical mistakes that many IBOs make is to ignore the bottom line when analyzing their Amway businesses. Most business building IBOs, sadly, are taught by their uplines to ignore losses, or to view losses as investments into their businesses, or that money is really not important. Some upline may teach that the business is more about making friends or being a nicer person. All of these things may be nice side benefits of reading personal development books, etc., but when running a business, the most important goal should be to turn a profit.

For many IBOs, their businesses consist of listening to standing orders, attending functions and meetings, but not focused on selling products and earning a net profit. And for most IBOs, nobody can blame them as upline may give them bad advice and because the Amway business is person to person selling, it is so inefficient that many groups end up teaching IBOs to simply buy their own volume and get others to join the business. For groups who operate primarily in this manner, you are probably running an illegal business because new and existing IBOs can profit only by continuing to add more downline IBOs in the hope that they too, will buy their own volume and sponsor others.

When you look carefully at the business plan, whether it is 6-4-2, 9-4-2 or some other variation, the majority of these business building IBOs will have low volume and likely to earn only about $10 a month. But to earn that $10 a month, you are likely to have to spend $300 on products, and if you are on standing order, voicemail and functions, then you likely spend anywhere from $150 to $250 monthly to participate in the teaching system. Thus these IBO's bottom line is a net loss! It is only when you are able to sponsor many downline that your losses will get smaller and you will only profit when you have a sizable downline. That means your bottom line is a loss. And while Amway defender will argue that Walmart doesn't even give you $10 a month, you can certainly get more products from Walmart for $300 than you can get from Amway for the same price. Walmart will match any advertised price on a product that they and a competitor may carry. Also, Walmart's advertising reaching millions of people, which is much more effective than person to person. While Amway runs some ads now days, they do not directly drive customers to IBOs. The vast majority of IBO business is still to themselves and their downline, and not to non IBO customers.

I challenge IBOs to look objectively at their bottom lines. It is likely a new loss. If it is, ask your upline how long this is expected to last. Set hard goals and if you are doing what is advised by upline and results to not improve, you may have to ask yourself what willl change to make your business profitable. Basically, if you aren't adding active downlines and customers regularly, you aren't gooing anywhere and are likely to be running your business at a loss month after month after month. It won't take long before you realize that you have lost thousands if not tens of thousands of dollars.

As a former IBO with a 4000 PV business with eagle parameters, I was not making a net profit. I saw my bottom line and although doing and achieving what my upline advised, there was no money. I decided the effort, time and money invested wasn't worth it. Plus my upline started to interfere in my personal life. I saw my bottom line and wasn't satisfied, and I left Amway. I later discovered the lies my upline had fed me to keep me in the business and to keep me buying tools. It is why I started blogging. For now, my bottom line is to get the truth out about the tools scam run by upline. That is Joecool's bottom line.