How IBOs Get Scammed?

 In my experience and opinion, Amway IBOs get scammed in the process of being recruited as IBOs because they mistakenly think they are going to become actual business owners.  The sad reality is that the prospects and IBOs themselves are simply being sold a system that's supposed to make them money.   Not much different than those late night informercials where the pitch man says he can make you rich if you buy his fool proof system of success.  Then they'll show testimonials of people who allegedly made money using the system.

In the meantime, nobody has ever verified that the guy making the pitch has actually made any real money following their own advice, nor do you ever see bonafide evidence that those giving the testimonials have ever made a cent from the system they are pitching.   It's really no different from the Amway diamonds who show you slide shows of mansions, fabulous vacations and sports cars.  Typically the diamonds will show you pictures of Amway sponsored trips and not necessarily trips that they paid for on their own.  

How do you know that your diamond is even currently qualified, much less "rich"?   The answer is you don't know.  You assume that they are because you're told so.  Oh, they might flash you copies of a large check they once received or something of the like but you'll be told "none of your business" if you ask for actual financial credentials.   But at the same time, these diamonds expect their faithful downline to blindly follow advice and invest their money following a system that may not have even worked for the diamond.

If you didn't know, a lot of money is made by selling get rich systems to people, which is why you see all those infomercials on TV or maybe heard them on radio.  The pitch is enticing and curiosity often makes people want to take a chance on seeing what is actually involved.  You know, like 2-5 years of hard work that is supposed to result in lifelong residual income that you can "walk away" from.   Even if it takes 10 years, that's better than working 40 years at 40 hours a week right?   That's the bait the Amway recruiters use on prospects and often, they use that curiosity approach.

But in the end, you are simply an unpaid commission only Amway sales person who gets no benefits and must even use your own money and time to promote and sell Amway products and hopefully the opportunity to others so that you can leverage downline volume with yours.  Most people do little and quit, or do nothing and quit.  You really cant build any kind of sustainable business where the participants are most likely to do little or nothing before quitting.  Your best chance of making money is to sell these teaching systems where you make nice profits regardless of the results of your customers.

The Big Secret?

One thing that I was unaware of as an Amway IBO was that our uplines were massively profiting from our tools purchases. I was in WWDB at the time and I was told very clearly that nobody made money from the tools and in fact, I was also told that WWDB was a non profit organization. Both of these statements were bold lies told by WWDB leaders and they have never been held accountable. We were told that upline cared about us and our success, thus they spent their own money to fly to functions to teach us how to succeed. Turns out they were all lies.

Eventually, the internet and other media made it impossible to cover up these lies and uplines finally admitted that they profited from tools. However, it looks like the upline downplayed the magnitude of the tools profits. I believe some upline may have made most of their income from tools, especially leaders who may have fallen out of qualification.  Amway doesn't publish currently qualified diamonds so nobody really knows who's a real diamond except Amway, and they don't tell. Now days, the upline admits they make some profits from tools, but there is still a great deal of secrecy in the tools business. Has anyone ever seen a written agreement on tools compensation? So say you qualify diamond and your crown ambassador decides you don't get tool money, what legal recourse do you have? 

What makes the whole thing with tools ironic is that the uplines are not supposed to entice Amway prospects into joining by using the tools money as a draw, but at the same time, they are told that tools are vital to their success. Uplines also show off trappings and lifestyles to attract recruits, but I believe that these trappings were likely obtained with supplemental tool income. I wonder if the diamonds actually owned the toys they showoff?   I suspect that some rent cars or houses to make the show attractive. And tool income has a higher profit margin than Amway products and fewer people participate in the pay plan so it makes perfect sense. Let's take Dream Night. It costs about $75 per person, but I can schedule a fancy dinner in a hotel for about $25 to $30 per head. The rest is profit. Same with FED, but FED probably costs less as there's no dinner and the fee is about $125. That's where the real money is made.  Just do the math and the answer is clear.  

I wonder how many prospects or IBOs would be fired up about buying tools if they knew that their uplines might not currently be qualified at the level they claim to be, and knowing that the uplines will make a ton of money whether or not you make a cent as an IBO? Also, some uplines are shameless in pushing the tools on downline. Sure they might cut the newest guy a break and loan them some cds, but once that IBO decides to start building downline, they are likely to be told that a real business owner buys their own tools, or that a business owner needs to be a leader and purchase extra tools for their downline.

How would you feel if your upline is touting themselves as a financial genius but in the background, their homes are foreclosed or they have financial difficulties? What if your upline touts their morals and you find out they are divorced or getting a divorce? What if your upline said Amway saves marriages? Your upline certainly won't say they are perfect, but conversely, they should be held to the highest standards if they are using their status to be able to sell tools and make large profits.  

These are some Amway secrets that your upline doesn't want you to know about.

The System Works?

One of the things I have heard over and over by Amway supporters is that their system works if you apply it. But is that really true or not? I contend that it is not true because many of the things recommended by the system comes with baggage that most IBOs cannot carry, or is not within the control of an IBO. For example, an IBO can be sure to listen to cds and read books every day, but being able to show a plan means you have to find someone who's willing to see it. Or selling a product means you need to find someone who's willing to buy it. While on the surface, that sounds reasonable, but in practice, many IBOs find it impossible.

There are reasons why the two biggest challenges facing most IBOs is finding prospects and being able to sell products. The challenge comes from the higher prices in general that Amway charges their IBOs. An IBO will often try to justify the price by citing quality, or concentration. But these factors are subjective and the vast majority of consumers will simply see a similar (or same) product at WalMart with a lower price tag and buy it there. For probably most consumers, the price tag is the bottom line and it is why the WalMarts of the world are wildly successful. Another hurdle many IBOs cannot overcome is the problem of finding people to show the plan to. Because of past IBO behavior such as tricking people into Amway meetings, or being deceptive about the purpose of the meeting, or outright lying, many people in the north American market think there is something shady about Amway IBOs. In some cases, it is unfounded, but still, the stigma follows because too many people have or know someone who had a bad experience in Amway, and many people in the past who did work the system, ended up losing money because of the system. These factors make business building in the US nearly impossible, and explains why Amway is stagnant in north America, and why groups are shrinking rather than growing. Amway recently did some PR things, including some commercials, but still I do not think it was done in time to fix the reputation issues. 

Aside from sponsoring/showing the plan, and selling products, nearly or all of the system activities are non income producing activities for downline and in fact, many activities such as voicemail or standing orders are major profit centers for certain upline. Thus it would make sense for upline to promote these activities to downline, because they profit from it. It may or may not help the IBOs. But there is no unbiased evidence that the system works if applied. Sure, Amway supporters will point out that all the new platinums and above were on the system, but don't mention that for every "success" story, there may be hundreds, thousands or tens of thousands of failures. To call that a success would be a tough sell in my book. 

So does the system work if you apply it? Based on the evidence and my informed opinions, I would have to say "no". But IBOs must make their own decisions. Are you experiencing a net profit? If the answer is no, ask yourself why not? Is the system the reason you have a net loss? If the answer is yes, ask yourself if you should continue. If you are told that the system saves your marriage or makes you nicer, ask yourself if you own a business or are you participating in a self improvement class. Ask the tough questions. As a business owner, you owe it to yourself and your business.

Amway And Gambling?

Let me make a disclaimer right off the top so Amway defenders don't try to discredit the post without reading it. The Amway opportunity is not a game of chance. But I will go on to explain how and why the opportunity can be compared to gambling and why the diamonds can be seen as a casino or the "house". In either case, the fact that Amway is not gambling, but yields lower success rates than gambling speak volumes.

In the Amway opportunity, the odds against someone going diamond are astronomical. Literally millions of people have attempted to build an Amway business in North America over the years and diamond club for North Anerican diamonds a number of years back had 160 diamond-ships represented. Certainly some north american diamonds may have turned down a free trip to Hawaii but I'm guessing that's not a big number. 

The odds are also stacked in favor of the diamonds. Casinos are not built by winners, but by the hoards of losers. Just as a diamond business is not built by having a foundation of winners, but layers and layers of IBOs who are losing. The Amway opportunity is simply set up that way. Look at your common 6-4-2 plan or whatever version your group uses. The newest or biggest layer of IBOs make very little and when you factor in expenses such as functions or standing orders, the losses can be staggering. 

A diamond, like a casino will attract many young dreamers who think they can conquer the world and will get rich. They use bright lights and profile former winners just as Diamonds show off fancy cars and testimonies to lure in recruits. The newness of the opportunity gets you excited, just as someone walking into a casino might feel the excitement with the sounds of the casino. All you need is some effort and little luck right? Sadly, that excitement is all too often replaced with the harsh reality that most must lose in order for there to be a few winners, both in casinos and the Amway business. 

Like casinos and diamond uplines, there is much caring for active IBOs and for players who are spending their money in casinos. But once you walk out of the casino, there is no special treatment, just as an IBO who stops building a business or stops being core quickly becomes forgotten. In Amway, people who said they were lifelong friends were never heard from again once an IBO missed a few meetings. If you re-emerge, you will find the love again, just as you will get free drinks when you start gambling again.

And yes, there are some exceptional people who can scratch out a nice living by gambling but they are few and far between, just as there are diamonds, but diamonds also have thousands of people who wanted diamond but could not achieve it. Those who can finally make it usually have an exceptional blend of skill and a bit of luck. Some even cheat/lie in order to gain a bigger edge, both in gambling and in Amway. 

Like a gambling "system", the Amway opportunity has "systems". In either opportunity, the system doesn't work for the masses. There are an exceptional few who can make it work. Except in gambling, most people understand that the odds are stacked against them. In Amway, many new IBOs are told that anyone and everyone can succeed when it simply is not true. 

Can you fulfill your dreams by gambling or with the Amway opportunity? The answer is yes, but the reailty is that few will ever do so. Like casinos and Amway diamond-ships, both are built on the backs of those who lose, not on those who win.

The Real Cost?

One of the common things Amway leaders apparently do is to disparage people with jobs. Oh, they would say we needed people to wait on our tables and clean our toilets, but in general, jobs were put down and basically the group was told that Amway is their best chance at achieving financial freedom, giving them the ability to flush their jobs. Ironically, IBO's jobs are what funds their Amway businesses. Most IBOs would be out of business within weeks if not for their job income funding their Amway businesses. 

The key selling point appears to be the 2-5 years of part time work rather than working a job for 30 - 40 years and then retiring on social security which may or may not be there when you retire. This plants a fear in people about the future and then the Amway opportunity is presented in a positive light because the Amway opportunity comes with a low start up cost. What uplines do not mention is how the opportunity can become a money pit as the monthly defacto 100 PV quota starts to add up. It is my guess that if people only bought items they truly needed, these IBOs would likely move 100 PV every three months, unless they are actively selling goods to non IBO customers. With Amway products being so concentrated and efficient as IBOs claim, why would you need to replenish these products so often?

When an IBO finally agrees to register, it is then that the true, but hidden costs are revealed. Many uplines will introduce standing orders and functions and present these tools as vital to IBO success. Most new IBOs don't know better and feel subtle pressure to conform and give it a try. Some upline may loan some tools to downline in the beginning but eventually, the IBO will be encouraged to be a "serious" business owner who should be purchasing their own tools to loan to their downline and the cycle goes on. There is also the cost of additional cds, books, voicemail and other business related costs that are not mentioned until later which the prospect doesn't necessarily know prior to start up.  

If you examine some version of the Amway recruitment plan, you will see that most IBOs are at the 100 PV level, which will reward you with a monthly bonus of about $10 or so. If that same IBO subscribes to the tools system, than IBO will likely be losing over $100 to $250 a month not including the cost of the product purchases. And because many IBOs have been convinced that working a job is so horrible, that they can be convinced that this condition of losing money is temporary and that untold wealth is right around the corner. Sadly, for most, this condition is the norm and even the sponsorship of a few downline, the losses continue to mount. Yet many are convinced that this is better than a job. And this is just the financial cost, not the time and effort spent pursuing a false hope and dream that Amway IBOs and recruiters promote.

Ironically, a job allows people to pay their monthly bills, feed their families and many people enjoy their work and co workers. While upline leaders may convince you otherwise, it is this very same excuse upline leaders use when asked why they are still working instead of walking the beaches of the world collecting massive amounts of residual income. I would encourage IBOs to truly analyze their efforts in Amway and determine if it is beneficial to your finances. In most cases, your Amway efforts ONLY benefits your upline's finances. For most who get involved, the Amway opportunity is not better than a job.

When You Have A Dream, The Facts Don't Matter?

One of the crazy things that our upline taught the group was that the facts don't matter when you have a dream. There is evidence that this is still taught today and in particular, I have heard that from Amway IBOs who claim to associate with WWDB.  Amway IBOs are taught to ignore facts because the facts make their Amway businesses look like a joke. Spend $300 a month on products to gain a $10 rebate when you could have bought the same or similar products at WalMart for a fraction of the cost. Then many IBOs spend another $200 or more on tools and functions so they can be taught to ignore facts of that all of this is somehow a great deal.   I really can't make this stuff up.  I've even heard IBOs mention how the facts don't matter when you have a dream.  

Any real business owner would never ignore facts. A real business owner makes decisions based on facts. IBOs are being duped into making business decisions on emotions and hype. The Amway opportunity is already saturated with handicaps and challenges, particularly in the US and Canada, where the reputations and previous antics of fellow IBOs have so stained Amway's name that it appears to be negatively affecting sales and preventing any meaningful growth. Despite what Amway apologists claim, Amway is very likely shrinking in the US, and will continue to do so unless improvements and corrections are made, in my opinion. It's also possible that it is too late to right the ship at this point.   Where are all the new diamonds and higher ups?   Amazon, with online sales, went thru the roof because COVID 19 made online shopping lucrative.   But why not for Amway?  Shouldn't their sales have gone thru the roof like Amazon?  

It is also why many IBOs talk about how Amway saves marriages, or Amway made them nicer people. Uplines will teach this because it takes a business owner's focus away from their bottom line, the profit or loss. Or IBOs are taught that a loss just means they are investing in their business, despite being told upfront that there is little or no investment needed and that a profit can be turned quickly in Amway. These uplines have gone on for years with no accountability placed upon them by either Amway or their downlines. Any "incidents" are simply ignored or history revised by uplines.

There is one blog on the internet, where a WWDB IBO is writing about buying homes in cash, and Amway IBOs having a 2% divorce rate compared to more than 50% in the rest of the world, yet you have Amway defenders claiming this isn't being taught, when clearly it is. Cover it up all you want, the evidence is right there but these folks aren't interested in the facts.  Sadly, that blog owner has now quit Amway and deleted his blog.  Any old time readers remember Shaun, the zealous WWDB IBO.  His blog was called "Expeditions Of Truth".  

Why are Amway IBOs ignoring facts? A better question is why Amway IBOs would listen to a "mentor" who teaches them to ignore facts?

Getting Something 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).