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 were 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 usually refering 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 occured 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 downline, 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 platinums, 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 noone has ever undertaken, to shows an actualy 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.
Friday, July 31, 2009
Wednesday, July 29, 2009
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.
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.
Monday, July 27, 2009
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.
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.
Friday, July 24, 2009
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.
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.
Thursday, July 23, 2009
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?
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?
Wednesday, July 22, 2009
Amway - IBOs and Personal Responsibility?
In my blogging career, I have seen many IBOs mention that their beloved system is basically foolproof. Follow the system and you will "make it". Uplines nearly guarantee that you will succeed if you follow the system. Many IBOs who did not make it blame themselves for failure.
What I find very ironic is how uplines twist the issue of responsibility. What I mean is some of them will stand on stage, possibly in front of tens of thousands of people and proclaim that IBOs should trust upline and do what upline advises, and that will virtually ensure success. Yet if an IBO fails or does not progress in the business, the IBO is held accountable for any failures.
While the Amway business is not a game of chance, a good analogy would be to promote the lottery and tell lottery customers that you have a sure fire way to increase their chance of winning the lottery. For example, your advice may be to select the month of your birthday as one of the lottery numbers, or use the date of your spouse's birthday as a number. Then when the lottery customer loses, you simple say he failed to pick the right numbers. And of course, if that customer wins the lottery, you cite your wise advice as the reason for winning the lottery. In either case you cannot lose.
It is much the same in Amway. Upline will entice prospects to join by showing them fancy homes and cars, and talking about early retirement. Then when a prospect gets excited about these "possibilities", then upline will try to convert that prospect into a customer of the system. Or they will tell the prospect that they can only succeed by using standing order and attending all functions. They say the system is the only way to go. Then if an IBO fails, they blame the IBO.
It's like upline playing a game of heads I win or tails you lose. Think about it.
What I find very ironic is how uplines twist the issue of responsibility. What I mean is some of them will stand on stage, possibly in front of tens of thousands of people and proclaim that IBOs should trust upline and do what upline advises, and that will virtually ensure success. Yet if an IBO fails or does not progress in the business, the IBO is held accountable for any failures.
While the Amway business is not a game of chance, a good analogy would be to promote the lottery and tell lottery customers that you have a sure fire way to increase their chance of winning the lottery. For example, your advice may be to select the month of your birthday as one of the lottery numbers, or use the date of your spouse's birthday as a number. Then when the lottery customer loses, you simple say he failed to pick the right numbers. And of course, if that customer wins the lottery, you cite your wise advice as the reason for winning the lottery. In either case you cannot lose.
It is much the same in Amway. Upline will entice prospects to join by showing them fancy homes and cars, and talking about early retirement. Then when a prospect gets excited about these "possibilities", then upline will try to convert that prospect into a customer of the system. Or they will tell the prospect that they can only succeed by using standing order and attending all functions. They say the system is the only way to go. Then if an IBO fails, they blame the IBO.
It's like upline playing a game of heads I win or tails you lose. Think about it.
Tuesday, July 21, 2009
Amway - Big Dreams Unfulfilled?
Many IBOs talk about their big dreams and goals. It is something used by uplines to entice prospects into joining. Financial freedom, early retirement, fancy cars, designer clothing and luxurious vacations. These are many of the dreams that starry eyed IBOs have when they join the Amway opportunity. While it is a good thing to have dreams and goals, I find it somewhat cruel to get people to dream of these things when it is highly unlikely that any of them will attain even a tiny fraction of these goals. Sure, some of the tenured folks in Amway may attain some wealth, but overall, as a whole, IBOs suffer losses when the cost of standing order and functions are factored is.
Amway's numbers indiacte that the average income of an active IBO is $115 a month. Factor in an IBO's time and expenses and in many, possible most cases, there will be a net loss. How do you attain your dreams while suffering a net loss of income? It is unfortunate that some uplines will teach IBOs that they are successful even when that IBO is losing money month after month, almost directly attributable to the cost of the system. All the while, someone upline is seeing their financial goals and dreams fulfilled on the backs of their downline in the form of tool purchases.
The rest of the IBOs end up having their dreams unfulfilled. In many cases, they end up worse off, having lost time and money, and in some cases, friends as they may have shunned their friends and family, casting them off as "broke" or "losers", just because they did not see value in joining the Amway opportunity.
So IBOs, honest question. Are you on track to fulfill your dreams? If you are, can you say the same about your downline? If the answer is no, what is your next step? Your upline may tell you that your key to success is to buy more tools. Be wary and analyze your income versus your expenses. If you are told to ignore these facts, be careful, be very careful.
Amway's numbers indiacte that the average income of an active IBO is $115 a month. Factor in an IBO's time and expenses and in many, possible most cases, there will be a net loss. How do you attain your dreams while suffering a net loss of income? It is unfortunate that some uplines will teach IBOs that they are successful even when that IBO is losing money month after month, almost directly attributable to the cost of the system. All the while, someone upline is seeing their financial goals and dreams fulfilled on the backs of their downline in the form of tool purchases.
The rest of the IBOs end up having their dreams unfulfilled. In many cases, they end up worse off, having lost time and money, and in some cases, friends as they may have shunned their friends and family, casting them off as "broke" or "losers", just because they did not see value in joining the Amway opportunity.
So IBOs, honest question. Are you on track to fulfill your dreams? If you are, can you say the same about your downline? If the answer is no, what is your next step? Your upline may tell you that your key to success is to buy more tools. Be wary and analyze your income versus your expenses. If you are told to ignore these facts, be careful, be very careful.
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