Wednesday, August 31, 2016

Amway Creates Millionaires?

I keep hearing from some IBOs that they belive that Amway has created more millionaires than any other company in the US. I call BS on that claim. I am not saying that Amway hasn't created any millionaires, obviously, the Amway owners are worth billions of dollars. But what the IBOs are apparently implying is that the diamonds are millionaires. I'm sure there are some diamonds who indeed are millionires, especially if they are tenured diamonds, in particular the double diamonds and higher. But conversely, I believe that many high level diamonds are not millionaires. I believe it is just as common for a diamond to be in debt as it is for a diamond to be living large. I also believe that many diamonds did not accumulate their alleged wealth exclusively from Amway.

The reason why this is an issue is because these big pins will stand on stage and show off excessive wealth and imply that it is their Amway income that pays for these mansions, sports cars, and in some cases, jets. In the US, I attended a function called "Dream Nite" where these kinds of trapping are displayed, to the tune of the song "I wanna be rich". The diamonds would say that you can have what they have, if only you will do what they advise. These functions still go on today and I believe it is now called Winter Conference.

Stanley and Danko's book, "The Millionaire Next Door"
http://www.personalfinanceplaybook.com/2009/08/the-millionaire-next-door/

This book makes some very interesting points which I believe applies to Amway diamonds. I will outline the significant ones and I will comment below:

**Predictably, the data shows that most people who you believe to be very rich are not.

**High net worth individuals, statistically, tend to be people that live within their means. They don’t spend a lot of money. They don’t waste money. They tend to be pretty frugal people.

**The authors point out that most of the richest people you know aren’t driving expensive luxury automobiles. That’s what the people who want everyone to think they’re rich drive.

Joe's commentary. The book does say that about 1/3 of millionaires acquired their wealth thru a J-O-B and saved and invested, but did mention that many millionaires were also business owners, such as a pest control company, etc. But based on the points made by the book above, I can see where it is likely that diamonds portray a wealthy lifestyle as a recruitment tactic, when the reality is they may be living very middle class lifestyles off stage, or may even be in debt. I have seen evidence of diamonds having their homes foreclosed and being in debt (Ruth Carter's book: Amway: Behind the Smoke and Mirrors). Recently, there was also a report that Triple Diamond Greg Duncan filed for chapter 7 bankruptcy. The report indicated that he could not make his mortgages, or something to that tune. Odd, because when I was in WWDB, some of the upline leaders said diamonds paid cash for everything because paying interest to the bank wasn't very smart.

My question is why IBOs continue to make up these claims? Try googling millionaire or Amway millionaire. There is nothing to indicate that Amway was responsible for creating the "most millionaires" of any US company. If this were true, wouldn't Amway state it on their website? If someone finds any veracity about this claim, inform me and I will post it.

Tuesday, August 30, 2016

Amway Versus A Job?

One of the ways that upline diamonds would put down jobs was to toss in the 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 hourly 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 think not!

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 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 likely 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, afterall, 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.

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!

Monday, August 29, 2016

Amway's Path To Financial Disaster?

When I saw the Amway plan, it was presented sort of as a raod to riches. Yes, the presenter was careful not o 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 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.

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 and dedicated IBOs will typically spend about $200 a month 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 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 30 to 40 downline. The catch is that only about 1 in 5 IBOs manage to sponsor another IBO.

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.

Friday, August 26, 2016

Amway IBOs Fail By Design?

So many IBOs quit and fail, I think the Amway corporation might need a calculator to keep track. And of the IBOs who work and try hard, most of those IBOs also end up in failure and losing money. After years of blogging about Amway, I believe it is because the uplines and the tools they sell to help IBOs are ineffective. When I was an IBO, I don't recall many tools that contained information teaching me how to run a business or how to run an Amway business. There was no talk about tracking income and expenses. In fact, our group was advised to ignore the facts. The scary thing about this is that it is evident that some groups are still teaching this.

Many IBOs and prospects are lured into the business by displays of wealth and not because of bonafide and verified business credentials. A friend of mine sold his franchise business a few years ago and part of what he provided to the prospective buyer was the last three years of his tax returns, personal and business returns. But try asking an upline to even see a business profit loss statement or a schedule C business tax return and you are likely to be told it is none of your business. Instead, upline may show off a photocopy of a bonus check which may be an annual or a once in a lifetime bonus. Or upline may show off a sports car as evidence that they are successful. Sadly, some of these uplines might be broke, they may owe back taxes to the IRS and/or they may even be in debt but simply showing off wealth.

Some uplines have the nerve to discourage young people from furthering their education because they would rather they channel their money into Amway and tools. Some people are told to make family sacrifices to attend more functions or to buy more standing orders. I will grant that not all uplines do this but based on my experience, I would say more uplines do this than not. They will apply subtle pressure on new IBOs and the newbies probably don't know much about Amway or business so they basically have to choice but to trust a diamond who has allegedly achieved the pinnavle of success in Amway. Then uplines will often betray their disciples by saying that failure is the personal responsibility of teh IBO. That advice needs to be discerned by the new IBO and bad advice should be discarded, as if a new IBO would know what is good or bad advice.

I aso see experienced IBOs who don't seem to know how taxes work. I see IBOs who were given the impression that Amway is easy and that they will work once and enjoy the fruits of their labor forever. Oddly, I don't know of a single IBO who did the work once and sat back collecting residual income forever. I find it odd that even tenured crown ambassadors continue to keep busy work schedules. I suppose they could just enjoy this lifestyle but still I find it odd that nobody I know of could specifically name an IBO who achieved diamond and higher and sat back collecting income while enjoying the beaches of the world.

Seems that IBO turnover and failure is more common than not in the AMO world. It also appears that incoming IBOs are like fuel to a fire. Without continuous recruitment and replacement of IBOs who quit, the organization would eventually fall apart along with the bonuses that the higher ups enjoy. It is my informed opinion that many IBOs fail because they aren't taught sound business principles. Despite the constant flow of cds, voice messages and functions and meetings, it doesn't seem as if any practical information is passed from upline to downline. Only messages of never quitting and continuing to dedicate themselves to the system. The result is inevitable and the expected result is failure. That failure is by design, expect the IBOs don't see it.

Thursday, August 25, 2016

Amway Dreams Or Reality?

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

In the Amway business, via the "systems" such as WWDB or Network 21, the leaders will often sell hopes and dreams to the downline. That the downline can be retired at the age of 29, walking the beaches of the world while the income just rolls in forever and ever. These kinds of "dreams" would be the same as hoping to win the powerball lottery. You may have seen a few who did it but the chance of you duplicating it is very unlikely. Slim to none is your chance in reality.

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

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

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

Wednesday, August 24, 2016

Amway And WWDB?

In looking back at my IBO days, I can now laugh at some of the weird stuff we did, and believe it or not, I have reason to believe that my old LOS, WWDB still teaches some of this and some other major groups also teach it. I believe some of these practices were the reason why some people refer to the Amway business as cult or having cult like qualities. If you recognize some of these practices, you might be in an unethical group and you should ask your upline the tough questions and possibly reconsider or reprioritize your involvement in the business, especially if you can't get straight answers to your questions.

Submission to upline was one of the things we were told. Our group was told that upline would never purposely lead us astray so we should trust them and never try anything without checking upline. Afterall, upline had experience and probably had all the answers. Some of this checking upline included asking permission to get married, buy a car or a home, or even something as small as purchasing a camera. The upline said maybe someone upline might have advice on how to get a good deal on a camera so no harm in checking upline before making a purchase. It is my guess that upline didn't want your disposable income being spent on anything other than standing orders and functions.

Late meetings. Our upline was into late meetings, many occuring after midnight. I suppose it was a show of loyalty and dedication to the upline and the system. In reality, it made most people angry at their jobs because they had to wake up early to go to work. For me it made me mad at our upline because the meetings taught us nothing of substance and it just made us tired. Our upline used to talk about time being important but it was never important enough to make him show up on time for his own late night meetings. Another cult like factor - sleep deprivation.

Secrets. Anytime we asked about how much income uplines may have been earning, we were either told it's none of our business or shown a photocopy of a 5 year old bonus check that someone upline may have received. Our proof that the business worked was upline showing off pictures of sports cars and mansions. Of course we now find that some WWDB diamonds had homes foreclosed, and one prominent triple diamond had some dealings in bankruptcy court. Looking back, I suspect that many diamonds have mortgages, which would be nor problem except that these leaders scoffed at the sutpidity of having a loan. That diamonds pay cash for everything, including homes. My former sponsor still lives in a run down rented home beause he won't purchase a home unless he's got the cash. My former sponsor is a physician so I find his position on buying a home preposterous. His oldest child, a son probably grew up deprived of his parents because of dedication to the system and the functions.

Losing money is success. Many times, our group was told that losing money was a sign of success. It was success because we were investing in our futures. That the business really is not about money but about friendships. I suppose upline taught this because everyone was losing money so it was nice to hear that success was around the corner, and that we were all nicer people and on our way to success if we just attended more functions and bought more standing orders. People who sold off some of their personal property were edified if they did so to attend a function. Obviously these folks were not advised to run their business within their means. Upline even said that going into debt was okay, but only if the debt was to invest in the business or to buy extra function tickets.

While some of these practices seem bizarre, I believe it is because the upline advice was self serving and meant to channel their downline's dollars into tool purchases. It is the only conclusion I can make.

Tuesday, August 23, 2016

Amway Upline Conmen?

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 crossline IBOs rearranging pre-planned anniverssary 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 seperate standing orders. Brad Duncen 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 crossline did not fare so well. I know of one couple who declared bankruptcy. I don't know how much their WWDB involvement contributed to bankruptcy, but I am certain it was a major factor and I know of two couples who had homes foreclosed, and I believe that their allegiance to WWDB was a factor in those foreclosures. But I guess hey, two WWDB diamonds had homes foreclosed so maybe they were duplicating?

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.