Amway - Your Chance Of Success?

Prospects and new IBOs may wonder at times, what is my chance of succeeding in Amway? It is a fair question, and one that is likely to be spun into another debate, or avoided by upline and Amway apologists. It is why an upline may show you a copy of his diamond's bonus check, but fail to mention the expenses associated with the business. Or they may show you slide shows of mansions and sports cars, but not tell you about their mortgages or their proceedings in bankruptcy court. In other words, many Amway uplines will imply their financial success with displays of wealth and other "trappings", but apparently, none have ever come clean about their business income. In the real business world, this kind of disclosure is common. Now I am not talking about disclosing social security numbers or about how much one donates to charity, but simply the Amway business income and expenses as outlined on your schedule C business tax return.

Aside from all of this, what is the chance of an IBO succeeding? Well, obviously, if you sign up and do nothing, or sign up and never order anything, then you received fair compensation for your efforts, which is nothing. But what I am concerned with is the IBOs who are told about a virtual guarantee of success if they do the work. That is not true, many IBOs do put in an earnest effort only to lose money, most likely due to the expenses such as standing order and functions.

Only 1 in 5 IBOs manage to sponsor another. Thus if you are not able sponsor downline, you are unlikely to succeed in Amway. Even if you sponsor some downline, unless they can also sponsor, they are unlikely to stay in business for long. Can you actually sell products? That is another way you can succeed, but since Amway IBOs only sell about 4% of their goods to non IBOs, unless you are good at selling, you are also very likely to fail at Amway. And selling can be challenging with limited advertising, and the fact that generally, Amway products are priced higher than comparable products available at other retailers, because Amway must include their bonus payments in the cost of their products.

Then you also have the reality of the business. The 6-4-2 plan includes 79 IBOs, all doing 100 PV, and collectively, there is 1 platinum and 78 lesser IBOs. This shows that it is mathematically impossible for the majority of IBOs to make a significant income. Factor in the cost of business expenses and it's possible for everyone in the group to suffer a business loss, possible with the exception of the platinum.

So what are the chances of succeeding in Amway? Slim to none describes it quite well, in my opinion. Sure, Amway is not a gameof chance, but still, as someone involved or someone thinking of getting involved, you need to take a look to see what is the likelihood of success. Sure, some people can and will succeed, but you need to analyze your business objectively to see if you are progressing as per the plan, or are you simply becoming a statistic while being advised to ignore facts by upline?

Amway - Unethical Uplines?

It seems as if the most common problem with the Amway opportunity is the presence of unethical uplines. What is scary is that these upline may tell you that they care about you and that they want you to succeed. All the while, they are working on another agenda. The root of the problem is that some of the upline leaders profit from tools, thus they operating with a conflict of interest.

An IBO's business should be treated as such, and a case by case, person by person assessment of the business should be made before an IBO should be strongly encouraged to be involved in the tools systems. But most uplines don't do this. They will just address the audience and promote the system as the key to success, without knowing what each IBO is trying to achieve. In some extrememe cases, families are told to do without basic necessities in order to buy more standing orders or to attend another function. It boggles my mind when I think about it.

There are some red flags that may indicate if your upline has your best interest at heart, or his own best interest. A lack of emphasis on selling products is a red flag. A business exists to make a profit, and not selling products is a good way to fail in business. Not watching your profits versus income is another way to fail. If you are taught to ignore facts, you are likely being mislead by upline. Does your upline show off wealth and at the same time, spend time in bankruptcy court? Does your upline actually have wealth, or just the illusion of wealth? Are you told that total dedication to the system is all important?

If you see any of these signs from your upline, it may be in your own best interest to step back and take a close hard look at your business and see if you are getting to where you want to be. If not, there is no harm in doing something else or at least looking at making adjustments to what you are doing if it is not working. But the main thing, IMO, is to assess whether your upline leader is giving you advice that is in your best interest, or in his best interest?

Amway - The Merit Of Amway And The Systems?

Amway has been around for a long time. When the company first began, it wasn't uncommon for people to go door to door, perhaps with products in a radio flyer to sell them as a way to make some extra money. There was no extensive training program that I know of and certainly, there wasn't the stigma that the company has now. But in today's world, when people refer to Amway as being a scam, what they are usually referring to the motivational leaders and the associated systems. I believe that the systems were first invented as a genuine way to train distance groups, but the income and power of systems seduced some upline leaders into becoming conmen. Thus, I believe that many if not most systems are corrupted. I witnessed personally and still hear of stories where IBOs are encouraged to go into debt or sacrifice basic family needs in order to purchase more system materials. Amway's involvement in this is knowing that these abuses occurred and not taking any substantial action.

But what are the merits of the program when broken down? Many Amway defenders are quick to point out that many IBOs "do nothing", which may be true, but for the sake of argument, let's not even consider the ones who do nothing. Take the 6-4-2 plan that many use in recruiting. It involves 1 IBO with 78 downlines, all of whom do 100 PV. This plan also generally assumes that IBOs will be a part of the system apparently, because non system IBOs generally do not have the dedication to keep moving and selling products. This is because many systems teach IBOs that they are successful when they lose money! In 6-4-2. you have one platinum, allegedly the break-even point for system IBOs, and 78 non platinum, spending money on products, and winding up with a net loss, if they are dedicated to the system.

Of course, system expenses vary, depending on which system you are a part of. I have heard IBOs mention that their system expenses may be as low as $75 a month, to over $1000 month for hard core fully dedicated IBOs. I have issued a challenge, which no one has ever undertaken, to shows an actually platinum group where the collective group made a net profit after system expenses were accounted for. Noone has ever come forward to disprove this point. I believe a retailing group could show a net profit, but I do not believe that a group of prosumers or buy from yourselfers could ever collectively net a profit.

So for Amway IBOs and prospects, please keep in mind that it is the system that is often the downfall of many IBOs. A dedication to any system is very likely to nearly guarantee that you will end up with a net loss as an IBO. Can someone still succeed? Sure, but your chances are similar to that of someone hitting a big jackpot in the lottery.

Amway - Build It And They Will Come?

I recently posted a profit loss summary, provided by one of my loyal readers here, named Gina. It provoked a lot of good discussion and I believe it gave IBOs some good insight about tracking business expenses and business income. However, I have yet to see an IBO who is forthcoming enough to post a similar statement about their Amway business. Now we are not asking for specific details with names or personal information, but what would be so hard about identifying how much their sales and bonuses came out to and how much was spent on functions and other related expenses?

Basically, as was explained on another blog, if the Amway opportunity was as good as IBOs seem to think it is, why is it so hard to get people to see the plan, let alone sponsoring new people? Is it because most IBOs are not actually making a net profit? I would have to guess that if IBOs were actually making a decent net profit, say $200 a month even, that the retention levels in Amway would be much better than what it is now.

So for IBOs, I say build a level os success and prove it. And prove that it is sustainable not only for you, but also your downline. That will be all you need to recruit others. There would be no need to use deception or trickery that IBOs are well known for. When asked if you are making money, you won't have to change the subject and talk about how you are a nicer person or how you are a better husband or wife. You won't have to analyze semantics to spin the conversation away from actual net profits. If you are asked about a profit/loss statement, you can produce one and stand proudly by it as prospects take a look.

People looking to get into business generally care about the bottom line. If your bottom line is a net loss, then you are at a loss as a business. But if you build it, others will come to you to join. This may nto be news, but attending a function or listening to a new standing order is not an income producing activity. Selling products for a profit is. Remember, build it and they will come. Fake it till you make it doesn't work.

Amway - Duplication?

Many IBOs are taught that "duplication" is the key to success in Amway. It is why so many IBOs are deperately trying to sponsor downline. It is why, in my opinion, so many IBOs will use any tactics to get people in front of the plan. I have heard of many zany tricks and deceptive practices by IBOs who are recruiting potential downline.

Unfortunately, even IBOs who are able to sponsor a few run into problems. That problem is retention. Downline come and go with great frequency. Many IBOs come and go because they simply do not make a net profit and they quickly lose interest in "doing the work" for so little reward.

I will agree that duplication can be a vital part of being successful in business. But in real business, an owner will duplicate himeself/herself by hiring employees. The employees perform certain tasks in exchange for a wage or salary, and allows the owner to accomplish certain tasks that he/she cannot do single handedly. If the employee is compensated fairly, they tend to stay, and in jobs where minimum wage is the standard, they often have retention problems and have to hire and train new workers with regularity. It is no different in the Amway opportunity. Those who make money, although the exception, will stay, and the vast majority of IBOs, who make little or nothing despite their efforts, will leave. It is that simple. If IBOs were actually making that extra $200 a month or maybe even an extra $150 net profit, I would guess that they would continue to be in business. But like a real business, when they do not make money, they fold up and do something else, which may be simply working harder at their jobs.

While duplication is a good concept on paper, it doesn't work because not enough IBOs make a net profit. There is no continued interest in staying in a business where they spend more on tools and products than they take in. Groups who focus on the prosumer or buy from yourself concept make it worse for downline as they have little or no sales to add to their bottom line.

If IBOs and prospects would see and understand this concept, they could avoid a lot of pain.

Amway - What Credentials Does Your Upline Leader Actually Have?

I recently read a comment from an Amway zealot on another blog. She mentions that someone's credentials must be considered when looking at information that is presented. I will comment that showing me a sports car or a fancy suit is not proof of financial success.

I find this subject ironic because not one single upline leader, as far as I know, has ever supplied bonafide credentials about themselves. The audience assumes that the person on stage has certain credentials, but do they really? I will say that certainly, if someone is wearing a diamond pin for example, that this person has at least achieved the diamond level as recognized by Amway, but the level may not be current, and the level doesn't indicate the kind of income this person earns from Amway. (Joecool is criticized for being outdated even though I was at 4000 PV at one point in my Amway career)

What many people assume is that the diamonds buy homes and cars in cash, that they wake up at noon every day and participate in leisure activities all day while the cash rolls in. I have heard from some new IBOs, that their upline makes more money taking a crap in the morning than a critic makes in a whole year at a job. That IBO became quiet when some critics offered to take that bet.

But the truth of the matter is that as far as I know, only former diamonds have come clean about their Amway income. They are the only ones who spoke of credentials and accomplishments. Even critics of Amway will often openly speak about their experiences and achieved levels in the business. In the REAL business world, showing business tax returns and credentials are a normal part of doing business. It appears that only in the world of Amway is the supply of credentials and financial statements a big secret. Now I am not suggesting that IBOs or upline leaders should disclose their financials to the entire world, but certainly prospects and some downline should be able to see what their upline is doing financially, especially if that is the basis for purchasing their standing orders and function tickets. And I refer to business (Amway and Tools) income and expenses only, not from other personal sources.

I believe that IBOs and upline leaders do not disclose that information because it would not be beneficial to them. If it were, they would likely publish it freely, just as they flash around copies of checks. IBOs and prospects should take this to heart and ask upline the tough questions.

Amway - Time And Money?

One of the big things that the speaker hit on when I heard the plan was time and money. He said because of the job, you may have money, but not enough time to do what you enjoy. He went onto say that if you have no job, you may have a lot of time, but you'll be broke and won't be able to do what you enjoy. He also said that controlling time and money is essentially financial freedom. This concept appeals to many and makes sense in the big picture of life. Afterall, who wouldn't want to retire early and have enough cash to travel the world and only do fun things?

But the reality is that nearly ever single IBO who registers for the Amway opportunity and the tools system, will never realize this dream. An Amway recruiter may paint a nice picture of how simple the business is, and that you can simply buy products and get others to copy or duplicate you and before you know it, you will be in control of time and money, and live "happily ever after". At one time, I believed it myself.

The more likely case however, will be that the business, including the system of cd's and functions, will cause you to have less time and money. In general, the Amway (and partner store) products costs more than your local big box retailers, and the cost of the systems add up to at least several hundreds of dollars if you are "CORE". Thus ironically, what many seek more of, thend up with less of, because of the business and the related activities. The functions and other educational materials take up valuable time and resources from the IBO and rarely ever results in any kind of significant return on the investment. Most IBOs would be better not never getting involved.

Time and money, think about it. Are you getting more or less of it because of your involvement?