Is Amway The Least Efficient?

 I once published some pro-Amway comments about how there's nobody between Amway and its IBOs. When I heard the pitch, pretty much the same thing was said. That Amway could pay generous IBO's bonuses because they "eliminated the middleman". On the surface, this might sound correct, but not when you take a closer look at it. Sure, you may not have a traditional middleman, but you have layers and layers of upline and downline, all of you get a cut from the sale of product, provided they qualify for the bonus.   It's quite clear to me at least, that the Amway system adds middlemen to the process which adds cost to the products, even if upline says the contrary.  

Many big companies advertise their products such as Coca Cola or American Eagle Jeans. These products become household names and practically everyone in the US knows of these brands. Not so for Amway. In fact, the name Amway is often associated with pyramid or scam because of bad or unethical behavior on the part of IBOs. Amway pays for some advertising these days, but I wonder what their return on investment is for their advertising dollars?   Or do they advertise just for the sake of advertising?  WalMart's slogan is "live better, save money".  Amway's is "now you know".  Now you know what?

Amway recently reported a sales increase, but I wonder if that was because of actual growth or maybe it was because they simply had a price increase? I wish Amway was more open about some of the numbers they release but that is another issue. The increased sales by Amway however, means nothing to individual IBOs. Amway's growth is not related to individual IBO's profitability. It makes me wonder why so many IBOs brag about the Amway sales when their individual sales might be zero and they might be suffering business losses despite Amway's success?

So IBOs are basically left going person to person, word of mouth to inform people about their products. In my opinion, the least efficient means of moving product from Amway to the customer. Because so many past IBOs were desperate to sponsor downline in order to achieve a level or to leverage their sales, less than ethical practices were often employed. People tricked into attending meetings, people lied to or deceived about the opportunity. The damage in reputation is enormous. For these reasons, Amway is a tough sell in North America. I believe this would explain why there seems to be more growth in Amway sales in foreign countries. I believe this is because people in foreign countries are not yet familiar with being tricked into attending a meeting, or lied to as past practice in North America. 

Do you want to sell products in the least efficient manner? If so, consider joining Amway?

The Diamond Actors?

 In my opinion, Amway diamonds are nothing more than actors. They portray a role and while they might be envied by their downline, when the lights are turned off, what remains? I believe most diamonds are simply middle-class people portraying lifestyles of the rich and famous. We could debate whether or not a diamond has an easy job. Heck, I could concede that speaking at functions can be better than a 9-5 job, but the volatility of an Amway business can make a diamond live under greater stress than someone with a regular and predictable job.

My former diamond used to live in a middle-class neighborhood, and he told the group that he was buying a property in an exclusive gated community and was going to build himself a nice home. He said his home would be on a hill right above a nice beach where he could enjoy his hobby of spearfishing and the ocean. I don't know if he ever built that home but last, I heard, he is living in the State of Washington. Makes me wonder why he would move there when he was allegedly building his dream home in Hawaii near one of his favorite beaches. (Maybe the cost of living is cheaper there?)

Think of the diamond this way. It is a fact that most diamonds are not Q12 (which means they have diamond qualifications for all 12 months of Amway's fiscal year). A Q12 diamond averages about $600,000 from Amway (source: Amway.com) but only a small percentage of diamonds are Q12. The other average non Q12 diamonds average about $150,000 a year and they augment that income with tools scam income. So, an average diamond might make in the range of $250,000. You may thing they are "rich" but after business expenses are considered, plus taxes and family medical and dental insurance, and other miscellaneous business expenses, a diamond is not financially capable of buying homes in cash, having exclusive golf club memberships and buying Ferraris in cash. What is likely is that a diamond lives a middle-class lifestyle while acting like they are rich. I had a conversation with a former emerald who told me that most of her emerald income (or diamond for that matter) comes in the form of an annual bonus so her monthly income was relatively small.

There might be diamonds who are wealthy. But if they truly are, it is because they are at a level higher than diamond and they are also very likely to have income from sources other than Amway. We know that back in 2009, Greg Duncan a WWDB triple diamond filed for chapter 7 bankruptcy in Montana and it is public record. He had homes foreclosed. This man stood on stage when I was an IBO and told the audience that anyone who makes a loan is "stupid". I wonder how Mr. Duncan felt when he reneged on his multiple home loans, despite having a triple diamond income from Amway of about $40,000 a month?

For these reasons, I say Amway diamonds are just actors. Some better than others, but in the end, when the lights and shut off, they are not much better off financially than someone with a good paying job. In fact, I have read in several places that truly rich people don't show off their wealth. That is food for thought, isn't it?

The Hidden Costs?

 One of the things upline leaders 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. Some upline might even show a video of someone who walked off their job because they made it big in Amway. 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 startup 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, which also appears to be uncommon.

When an IBO finally agrees to register, it is then that the hidden costs begin to be revealed. Many uplines will introduce standing orders and functions and present these tools as vital to IBO success. Some upline may give you some free cds at first, but eventually you'll be told that a "serious business owner" buys their own. You will also be expected to do the same for your own prospects. 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.

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, then IBO will likely be losing over $100 a month not including 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.

Ironically, a job allows people to pay their monthly bills, feed their families and many people enjoy their work and coworkers. 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.

Quitting Is Winning?

 I often see commentary about people quitting Amway and Amway loyalists are quick to call them broke, losers, lazy, lacking guts. Ironically, these same lazy and loser types of people were "sharp" and motivated prospects before they signed up for the Amway opportunity. Someone recently left a comment on my blog about how AMOs should conduct exit interviews with departing IBOs to get to the root of the problems. I think these exit interviews would reveal that people are working hard and applying the AMO teaching, only to lose money,

Based on my years of blogging and Amway experiences, I can honestly say I believe that people quit Amway primarily for one reason. The money isn't there. Amway's own numbers show that the average IBO earns just over $200 a month and that is before taxes and expenses, and that number excludes inactive IBOs. Business building IBOs earn most of the bonuses, but business building IBOs generally have the most expenses, often participating in the system of standing orders, voicemail, books and functions.

When I was an IBO, I did as upline advised and I achieved a fairly significant level (4000 PV), but due to the expenses associated with tools and helping downline, I didn't earn net profit. This is confirmed by a study done by the Wisconsin attorney general some years ago who examined the tax returns of platinume and found that they averaged a net loss of about $1000 a year. While the study was a bit dated, I would suggest it is still very valid as platinums today, have more tools (business building materials) that they are expected to buy from upline. If I made nothing at 4000 PV, anyone with half a brain can conclude that IBOs below 4000 PV and fully participating on the system would end up with a net loss because their expenses would be similar to mine, but with less bonus money.

The bottom line is that people are very likely quitting because they aren't profitable. If people made a few hundred a month with 8-15 hours of work per week, they would continue to run their businesses. But those who work and make nothing or lose money have no reason or motivation to continue. Thus, they simply make a wise business decision and quit. What seemed like a good idea during the presentation simply did not pan out when reality set in. It's also reasonable to conclude that the products are that great because if they were, those who quit would become loyal customers, thus even if the sales force turned over, sales would consistently rise as former IBOs would become customers. It's apparent that most former IBOs do not become loyal Amway customers. In fact, for those who later discover they were lied to or deceived about the Amway opportunity, become critical of Amway instead.

Why do people quit Amway? I think the answer is crystal clear. The quitters are the winners!

A Legal Pyramid?

 Let me start out by saying that Amway appears to be a perfectly legal company, and therefore I am not saying or implying that Amway is illegal. But I believe that the way Amway businesses are run by IBOs, are like pyramids. In most groups, you will have the lowest level IBOs efforts and tool purchases being responsible for the upline bonuses and tools income. Many IBOs are fooled into thinking that the ability to surpass your upline or that you don't get paid to recruit downline makes this a good deal and that they will all be wealthy as diamonds one day.  Nothing could be further from the truth.

Unless you have a very rare group where actual product sales to non-IBOs in sufficient to cover the costs of running your business, functions and all, then it is true that the lower level IBO's jobs are likely the source of income for the uplines. How many groups are like that? None that I have ever seen or know of. In fact, how often do IBOs even sell enough products to cover their expenses for even one month out of the year? The groups that teach "buy from yourself" end up doing the most financial damage to their groups because the downline's expenses are then covered exclusively from the downlines jobs, bank accounts, or drive the downline into debt.

I've seen and discussed group structures in forums many times and I can only conclude that tool sales wipe out what little profits/bonuses some of the downlines might receive. Only when an IBO is able to sponsor enough downline to absorb the losses for them will they finally break even or make a little profit. I would guess that the 4000 PV level or platinum is where a dedicated CORE IBO would break even and possibly start to make some profit.  However, a high dedication to buying tools could still turn these levels into losses.  But we also know that most platinum groups have 100 or more IBOs in order to generate 7500 PV. Thus, we can also conclude that less than 1% of IBOs make a net profit. The only way IBOs can earn a net profit at a lower level is to avoid purchasing tools and to avoid paying for functions. Those who get involved in a system such as WWDB or N21 almost guarantee that they will have a net loss.

Sure, my job may have a pyramid structure with the CEO making the most money. But the difference is that in a company, even the lowest paid employee still receives a paycheck and has money at the end of the month. The same claim cannot be made by IBOs. For these reasons, I believe Amway to be a legal pyramid. IBOs and information seekers are free to participate, but I challenge them to sit down and really analyze their ability to make a net profit. In most cases, the analysis won't be favorable. If you are in the US in particular, you may have great difficulty in even being able to discuss "Amway" without getting strange looks your way from others. Good luck in whatever you decide.

Joecool On Vacation?

Joecool will be on vacation for the next 5 days.  I'll be visiting friends and may have difficulty with wifi so I'll just take a handful of days off.   This article is how IBOs are deceived right from the beginning. 

I was thinking about how Amway prospects are invited to see the plan. In many cases, there will have been a bit of deception or half-truths told in order for an IBO to get a prospect in front of the plan. But then I thought about the plan and how much deception was used in the plan itself by the speaker.

In many cases, IBOs and new prospects are deceived right from the beginning. The speaker might make some small talk, and get the prospect to agree on certain issues, such as income tax and insurance eating away at your paycheck, etc. When a prospect hears this, it will make sense, and they will agree and trust the speaker somewhat. After all, the speaker has been built up to be a financial whiz and all. And much of what the speaker says makes sense, at least on the surface.

Then the deception begins.............

The speaker might talk about IBOs saving 30% on products right from the start, which is false. Here's some information debunking that age old myth:
http://www.amquix.info/Save30_myth.html Not only do many products cost more, factor in shipping and handling fees and it's not even close in many cases.

Then the speaker might talk about 98% of people being dead or broke by age 65, which is not true. The speaker might talk about 90% or more of small businesses failing in the first year (which is also untrue). These little factoids (which are untrue) are apparently used to make other opportunities seem flawed in comparison with the Amway opportunity. Readers and prospects really need to do some research and due diligence, and they will easily see through the mistruths.

The speaker might then talk about how the Amway opportunity is cheap to get started and has little or no overhead. But the problem is that many dedicated IBOs will get hosed as their upline will begin to teach them that they need to invest in their business in the form of voicemail, book of the month, standing order and attending all meetings. These expenses nearly guarantee that an IBO will end up with a net loss of income. What's more, upline may teach that this is success! In many cases, the speakers don't care about the prospects. All they care about is getting people signed up and on the system. Sure, they may loan cds to newbies, but once an IBO wants more, they are likely told that "serious" business owners buy their own tools.

So, a question for IBOs and prospects. Is it a good opportunity when you have been lied to or deceived right from the outset?

No Kings?

 I got a kick out of watching some coverage of the "No Kings" rally that took place over the weekend.  I'm an independent voter who leans right.  What I don't understand is the rage and hatred for our current president.  When he was first running for office, I wondered if he was serious because I knew he was rich but I didn't know much else about him.  I tend to vote for policy over personality.  I agree that at times, Trump is brash and unfiltered, but the way he is treated by the mainstream press and others, I almost can't blame him for lashing out at times.  The press pushed so many lies such as the Russian collusion hoax and others.  The democrats who hate "election deniers" don't seem to mind if people deny the 2024 election.  The hypocrisy is amazing.

Trump was tried and convicted of 34 felonies in NY.  I asked someone was who gleeful about this and they could not specify what the felonies were.  As I understand it, an accountant who worked for Trump received an invoice from a lawyer and recorded the transaction as a "legal fee".  Somehow, the prosecutor with the help of a selected and liberal judge somehow turned a misdemeanor which was past the statute of limitations into 34 felonies.  Now the press and other politicians gleefully say the president is a felon.  I believe this case will be overturned but the purpose of bringing the charges didn't succeed since Trump for elected anyway.  

But this no kings issues is funny.  Trump was duly elected by the American people, in a decisive manner.  If you want to talk about democracy, the democrats haven't held a real primary election in many years.  Biden and Harris were not elected in primaries.  They were appointed.  They even tried to remove Trump from the ballot in several states.  How is that for democracy?   Some of the people who advocate for democracy don't even know what it means, just like those who claim that Trump is a King.

If Trump was "Hitler" or a "Nazi" as they claim, do you really believe that you can go on TV in front of a camera and criticize Trump and be alive the next day?  Or the governor of Illinois saying "when the democrats get back in power", they will prosecute ICE agents (prosecute Federal workers for doing their job?).  If Pritzker believed (truly) that Trump was Hitler, there would be no "democrats getting back in power".  He said the lies out loud.

I sometimes wonder if these protests are even organic.  It seems like many protesters were paid, as evidenced by large groups of people leaving the protests at a certain time, meaning their "shift was over".  I could be wrong, but if I am, don't these people have better things to do?  

If so many people wanted to protest "No Kings". why didn't they do it during covid when we were told to stay home (which didn't slow down covid), or to stay 6 feet apart (which didn't slow down covid) or to avoid gatherings (which didn't slow down covid), or to get vaccinated (which didn't slow down covid) and in the meantime, the Kings like Gavin Newsom is not wearing a mask and eating in a fancy restaurant during the beginning of Covid and Nancy Pelosi who wasn't afraid of sneaking around to get her hair done.  In Hawaii, we were not allowed to sit on benches outdoors at the beach.  The covid police would come and chase people away even though being outdoors was likely the best way to avoid covid.   I was accosted by a police officer because I walked into the road briefly to avoid a group of 5 joggers on the sidewalk.  Once they passed, I went back on the sidewalk, and the officer told me I wasn't supposed to go on the road.  I said I wasn't supposed to be within 6 feet of the joggers also.  He took down my name and gave me a warning and said I could be subject to a fine if I did this again.  

My point?  Nothing Trump has done resembles a king but what many governors did during covid looks like they were the leader of North Korea or some other authoritarian regime.