Build It Right?

 I believe that Amway IBOs have approximately a 50% attrition rate for the first year alone. If you look at a 5 year window, I believe the attrition rate is something like 95%. So, what we're saying is that out of 100 IBOs, only 5 will be around in 5 years, or out of 1000 IBOs, 50 will remain after 5 years. This is extremely significant because if you are a business builder, you will need to replace half of your IBOs every single year, provided you can even sponsor downline.  For this reason, I am very doubtful that there are IBOs who "built the business right and built it once", who no longer do Amway related work, but still collect significant residual income. I would guess that significant income could be defined as being enough to live a lifestyle in the top tax bracket (for the US) without having to report to a J-O-B.

Now I understand that some IBOs take it personally when I bring up subjects like this. It is because they have been deceived by some upline diamond or big pin who has sold them on a dream of financial prosperity for life if they will only work hard for 2-5 years. I once thought so too, but realized that there isn't a single diamond that I know of who built the business right and walked away to enjoy the beaches of the world while truckloads of money rolls in. Kinda makes you wonder why you see Crowns still working, and diamonds actually quitting or resigning. I have asked the question many times and it has never been answered. Can anyone name a few people who built their business right and built it once who is currently enjoying these lifelong residuals? Also, if that were a benefit, why doesn't Amway say so?

Instead, you have a constant and endless flow of motivation being sold to IBOs. This motivation comes in the form of cds, books, meetings, functions and other things like voicemail messages. It's sad that IBOs have to continue to pay through the nose for motivation and "teaching" about the Amway business when there are cheaper and more efficient means of communication. For example, why would you need an expensive voicemail when a facebook group account can disseminate messages to your group in seconds at no cost? It is because the uplines want to extract every possible sent from their downline. Because of the internet, I believe people are starting to figure things out and avoid the systems altogether. I hope Joecool's blog contributes to this.

All the motivation IBOs truly need is to see a net profit at the end of the month. If IBOs actually earned an extra $200 a month, or $50 a month, or $600 a month as advertised, there would be no need for motivational speeches. The IBOs would simply look at the growth in their finances and they would keep going. The poor retention rate is easy to explain. IBOs are losing money because of the system expenses and they lose their motivation to continue. If you are an IBO or a prospect, stop and think for a minute. If you are making an extra $200 a month with minimal effort, would you need functions and other materials to motivate you? Or would you have intrinsic motivation from the profit? All the motivation you will ever need is a net profit. Take that to the bank.

Altruistic IBOs?

 One of the things I often thought odd as an IBO was how our upline would keep teaching us that the Amway business was all about "helping people". Somehow, our upline felt that showing someone the plan or talking to them about the business was helping someone. That is because our upline felt that everyone was doomed for financial failure if they didn't join Amway. Of course, nothing could be further from the truth now that I am looking back. In fact, I would have to say that building the business and purchasing tools and functions was the CAUSE of financial disaster for some of my fellow IBOs. I remember reading about more than one home foreclosure and a couple of bankruptcies just within our group.   I recall a specific incident where the diamond had a special "playday", which was a picnic and some fun and games for his group if you currently had a 1000 PV pin.  I recall a crossline IBO with no downline who suddenly got his 1000 PV pin.  I assume with no downline that he simply bought the pin to be able to attend the playday.  This IBO later was listed as someone who had a home foreclosure in the Pacific Business News in Hawaii.  I don't know if buying 1000 PV caused the bankruptcy, but I'm sure it didn't help his finances either.

It's like IBOs held some dark secret and they could save the world by sharing this secret with prospects. So, the theme of many voicemails (Amvox at the time) was about how IBOs in the group were saving the world by helping people. I used to wonder how we were helping people when we basically only "helped" IBOs who wanted to build the business. If someone declined to join, they were forgotten. Our upline said we threw them a life preserver, but they rejected it, so we are moving on. it was often compared to a church activity where IBOs are saving souls. I actually found this extra weird because we were often taught that we could give the church money in the future ($10,000 checks) and we could serve in ministry after we were "free". I find this ludicrous now, but at the time, we were told that this was delayed gratification. After I left Amway, I spoke to the senior pastor of the church, and he opined that Amway was harmful to many because it simply held too many empty promises. In other words, they promote big dreams and wealth, but very few ever attain any success, for whatever reason. The pastor said the reason for the low success was not relevant. The fact that it was rare to see success was enough to conclude that Amway was not a good opportunity.

In fact, some diamonds can be seen as prosperity preachers. They speak about wealth attained through Amway when in reality their wealth may come from other source, such as tools income, yet they falsely promote Amway as their primary source of success. Then they bait and switch IBOs and tell them that the tools system is the only way to succeed, all the while profiting handsomely from the tools. They then justify their conflict if interest by claiming that IBOs are helping people and/or doing God's work by joining Amway. I believe many IBOs are giving false hope and promises to prospects, as taught by upline leaders. All the while they themselves are losing money while thinking they are supporting a noble cause. I hope they awaken before it's too late.

Behind The Scenes?

 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. 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.

WWDB Eagle Program?

 Reprint of a popular article:

Eagle Parameters: Signed Counsel Sheet to Upline Diamond 300 PV personal use/retail for couples, 200 PV personal use/retail for singles 6-5-3 (PB/SO/MF) - Explained below 6 legs at 100 PV or higher 5 legs on standing order 3 legs attending major functions



Being An Eagle Is Profitable?

I have listed the parameters for the eagle program above. I will provide an analysis and some comments about the WWDB Eagle program. In my opinion, the Eagle program is basically just a program where upline assures themselves of a certain amount of tools sales. The IBO with the eagle parameters is likely losing a ton of money.

First of all, an Eagle with minimum parameters/legs would be at about 1000 PV. That would equate to about $200 to $300 a month in PV bonus from Amway, with differences based on width, total number of legs moving volume, etc. For this example, I will assume the Eagle receives $300 in PV bonus.

200 PV for singles, 300 PV for couples. That’s $600 to $900 in personal use and retail sales. While IBOs may attempt to sell products, we know that many IBOs sell little or nothing. Even if an IBO manages to sell 50 PV to customers, that IBO would still be spending $450 to $750 a month on personal use, and perhaps earning $100 a month for selling 50 PV.

6 legs at 100 PV or higher. That is approximately $1800 a month in personal consumption and retail for these downlines. Assuming they each qualify at 3%, they would get about $10 in PV bonus each month. The $10 does not factor in business expenses.

5 legs on standing order. Depending on whether an IBO is on the premier club, their cost might be about $60 to $75 a month (or more) for standing order, and may vary if extra cds are purchased.

3 legs attending major functions. Major functions generally cost about $125 per person, per event. And the expenses does not include transportation which may include round trip airfare during peak travel months, rental cars, hotels, etc etc.



Let’s look at a single IBO with eagle parameters. And I will use “best case” scenario. Income might be $400 with the 1000 PV bonus plus the retail profit for selling 50 PV. $400 sounds like a nice tidy sum, especially for a single person. But looking deeper, we see that this person also had to consume $450 worth of goods for him or herself ($450 = approximate cost of 150 PV). Yes, he or she received products, but seriously, how many single people actually spend $450 a month on laundry soap, shampoo and other consumables when simply “changing your shopping habits?

Additionally, an “Eagle” would have to be a leader. More than likely, simply buying standing order is not sufficient. A leader should be consuming more cds as you cannot listen to the same cd every day. Factor in the books, monthly open meetings, average out the cost of major functions, gas money, and other business expenses. I would say it is safe to say that an “Eagle” would easily spend $300 a month (or more) on tools and other business related expenses (Tools = Books, cds, standing order, meetings, functions, voicemail workshops). If this Eagle has to fly to major functions, then that cost may be significantly higher on average.

So let’s summarize. In a “best case” scenario, an Eagle IBO would spend about $750 a month on products and tools. I understand that products are not a business expense, but if a single person is expected to consume/sell twice as much PV, I would say half of that expense is a business expense as it would be unlikely that a single person would ever use 150 or 200 PV worth of goods in a month. So lets use that case and say that an Eagle has $475 in expenses per month ($175 for PV and $300 for tools). The Eagle receives $400 a month in bonuses and retail income (best case scenario) with the IBO selling 50 PV worth of goods (which is not common).

In a best case scenario, an Eagle loses money! And what’s more, all of his or her downline, if they are also using tools, will also lose money! The only ones profiting from the Eagle program is Amway in the form of product sales, and the upline in the form of PV bonuses and the profit from the sale of tools!

Do you still want to be an Eagle?

Amway Deception?

 For many Amway prospects, there is a deal of deception that IBOs use in prospecting them. Now I don't believe that IBOs are evil or purposely trying to be deceptive, but I believe that many uplines teach some form of deception to unsuspecting IBOs, who in turn use these techniques and, in many cases, contribute to Amway's already battered reputation. There are many examples, but I will just give some of the more common ones.

Take the perfect water fiasco from the past. IBOs were promoting this product as if it were the cure all for any physical ailments, but apparently, it is nothing more than an expensive drink. The cost of one bottle of perfect water can just about get you a case of purified water at WalMart. Quixtar is not Amway. Another example of deception where IBOs tried to distance themselves from the Amway name and reputation. Another big deception was calling the Amway opportunity a private franchise. Amway is not selling franchises and IBOs do not operate franchises. If this were true, there would probably be franchising agreements that an IBO would sign with Amway and Amway would provide the training, not individual groups such as WWDB, N21, or BWW.

Teaching such as "fake it till you make it is also deceptive. Uplines will teach IBOs to fake success as a means to attract people to the business. It is why you might see nice people in suits and business attire at meetings, all the while arriving in broken down cars and trucks. Try getting an IBO to tell you what they actually earn from Amway and watch the uncomfortable or belligerent reaction.

I write this post not only because I experienced much of it, but there is evidence and testimonies out there that indicate that nothing has changed. Amway apologists like to cite critical experiences as "outdated" but fail to point out that these deceptive practices are still more common than they like to admit. If you were prospected or retained in the business by deceptive practices, can you honestly believe that uplines have your best interest at heart, or that they really care about your success? Recently, we have begun to see the hypocrisy and lies of some uplines. Bankruptcy, home foreclosures, terminations, divorces and "quitting" by some upline leaders have exposed the facade.

Sure, diamonds are just people, but they raised the bar on themselves when they made their claims and fortunes on stage. It's time for downlines to hold them accountable for their actions.

The Standing Ovation?

 One of the weird things I observed about Amway IBOS is how they worship the diamond as if he is some kind of divine being.  When you look at it logically, what has the diamond done to deserve such adulation?  The diamond qualified for the diamond pin one time and possibly one time only.  Heck, Joecool was a 4000 pin.   Does that mean new IBOs can or should take counsel from me since I achieved a fairly high level?  Even if I’m not currently qualified?  I believe it's easy to lose your diamond qualification.  If half or more of all IBOs quit within the first year and most IBOs do little or nothing, how can you build a business empire that won't fall apart? 

Amway doesn’t say which diamonds are still qualified so nobody really knows.  And that is why you see former copies of bonus checks as evidence of success.  A current copy of a check would be better but still would not indicate what kinds of expenses that diamond had.  I recall in the early days of running this blog, I inquired with a hotel on Maui, that hosted diamond club for that year, and they said approximately 150 families were in attendance.   So my conclusion is that there aren't that many diamonds as your upline would want you to believe, or these diamonds simply skipped a free trip to Hawaii and a stay a luxury hotel on Maui.  

A good example would be my WWDB upline diamond who probably qualified diamond in the 1980’s.  Back then there was no internet, and the business was very different than it is today.  That diamond also filed for chapter 7 bankruptcy in 2009 or so but is still revered as having superior financial acumen.  But based on what track record?   I might add that this was a triple diamond and because of the bankruptcy, the records were made public, although I no longer have paper records of this bankruptcy.  However, I do recall some significant highlights from the filings;  This diamond made about 500K from Amway and about 500K from tools and functions.  Now that's a great income, but nowhere close to what I though they earned.   And after business and normal expenses living expenses, I do not see mansions paid for in cash, along with personal aircraft and fleets of sports cars.  And really, living large with a million dollar gross income is a recipe for debt.  Just like professional athletes who go broke after they retire.  While diamonds may not stop working (so much for walking away to retire), I can see many scenarios where they can get into debt themselves or living bonus to bonus.

For some reason the audiences just assume that the diamond is successful and wealthy without really knowing the financial status of these leaders.   For all we know these diamonds are paying mortgages and in debt like the rest of the US population.  Why would it be any different when these diamonds show off a lifestyle of excess and even encourage IBOS to get into debt to purchase tools and function tickets.  If you ask upline to verify their financial claims you’ll be told it’s none of your business.

If your diamond’s financials are none of your business then you should not consider displays of wealth as any kind of evidence of success.  More likely that diamond lives check to check like much of the rest of the population.  What other conclusion is logical?

No Statues Of Critics?

 I often heard the saying in Amway: "there are no statues of critics". To that I would respond, there are no statues of Amway diamonds either.

I often wondered what the Amway opportunity would be without any critics. Most likely Amway IBOs would be blissfully building their business while blindly following upline advice to over consume PV and Amway related tools and functions. If you are in WWDB, have you noticed that your upline is often tracking how many audios you are sending downline and how many people you have attending functions? This is done because upline is trying to plan and makes plans for their projected income. Do the math on a major function and you will easily see what I mean.  What does that information actually do for your bottom line in your Amway business?  Aren't sales to customers more important?

Many Amway supporters think that critics exist only to tear down others or to bash the Amway opportunity. I see it completely opposite. I believe that Amway critics are important for IBOs. Without any opposing voices, IBOs would mistakenly believe that they are in Amway utopia except that eventually, they would notice that they are losing their shirts. An opposing voice is a good thing to bring up issues that you may not have thought of. Imagine what you might be like without the ability to feel pain? You might have injuries or illnesses that would go undetected which could eventually kill you. But you upline probably teaches people to "avoid negative". Avoiding excessive negative might be good but avoiding all negative is like an inability to feel pain.  

When I was an IBO, our upline (and many others apparently) claimed that nobody made any profits from the system (voicemail, books, tapes/cds. functions). Without any opposing voices, this might still be happening. IBOs had no way of knowing back then when the internet was not a common tool. Upline just told bold lies and got away with it. To this day, none of these "awesome" leaders have even been held accountable for the lies. The diamonds simply ignored it. Sure, they now speak about making some income from tools, but there is little transparency about how you actually qualify for a share and how much you get when you qualify. Why is that?

Critics have also pointed out that many IBOs are taught to ignore important facts such as their profits versus losses. Some IBOs are taught "fake it till you make it" or they are taught to "buy from yourself", both of which are ridiculous from a business standpoint. But without an opposing view, IBOs would never question upline. In fact, many IBOs are taught to avoid all negative such as don't watch the news or read the newspaper. In other words, upline wants you to be apathetic and only read and intake their Amway propaganda. This is why some people accuse Amway leaders of running a cult.

Think about this. I believe that having opposing views are vitally important for IBOs to consider. Valid criticism is good for IBOs who are serious about building their businesses. Constructive criticism is a good thing. If you consider good criticism as negative, just remember: As far as I know, there are no statues of Amway diamonds.  Why would valid or constructive criticism be a bad thing?  Because upline doesn't want you to think critically.  Why do you think they are often sleep depriving you by holding night owls and other useless functions?  The only thing night owls did was make me tired at my job the next day.  It certainly didn't help my business get to the next level.  Think about it.