Friday, February 12, 2016

Quitting Amway 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 Amway Motivational Organizations (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 a net profit. This is confirmed by a study done by the Wisconsin attorney general who examined the tax returns of the top 1% of IBOs in the state and found that they averaged a net loss of about $1000 a year. While the study is 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. After all, many people got into Amway to make extra money, not to wind up with a net loss. 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 aren't that great either because if they were, those who quit would become loyal customers. 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!

Thursday, February 11, 2016

Amway IBOs Fake It But Don't Make It?

One of the things I was taught as an IBO was "fake it till you make it". My understanding was that you were to act successful, even if you had not yet achieved your desired level. By faking success, I suppose you had a better opportunity to prospect other potential IBOs than by showing the reality. Broken down to its purest form, this is deception. To attract others to an opportunity where you are deceptive is less than honest, which I suppose describes my former WWDB upline leaders. What is also sad though, is that I believe this may still be taught. Part of this is evidenced by IBOs wearing business attire to all meetings.

I guess this should not surprise people who know about the Amway business because I believe that diamonds also embellish success as well. WWDB used to have, and still runs a major function called "Dream Nite". This is a function where the diamonds will parade on stage while showing a slide show of all the lifestyle you can achieve at the diamond level. Do what they do and you can have what they have, is what they teach. But can you really?

For one thing, new diamonds in the US or WWDB for that matter probably earn in the range of $200K to $250K a year when you factor in the Amway income and the income from tools. While that seems like a great income, factoring in taxes and medical and dental insurance and the kind of life style that diamonds portray with fleets of cars and mansions and gaudy jewelry and clothing, and you can easily see that diamonds are very likely playing a game of "fake it" as well. It is why I believe many diamonds are actually in debt and/or living month to month financially, just like the working stiffs they criticize in functions. I have heard testimonies and read comments about how IBOs saw their diamonds actually living in very average homes and at times, renting fancy cars and things to show off because their income likely cannot sustain the lifestyles they portray. A prominent WWDB triple diamond apparently went through bankruptcy proceedings and another had their home foreclosed a handful of years ago. . It is all adding up to what I suspect. That diamonds at best live middle to upper middle class lifetyles. Not that this is bad, but it is a far cry from how the diamond lifestyle is dishonestly portrayed. Take away the tools income and the picture would not be pretty, in my opinion.

So IBOs and diamonds can fake it, but I suspect that many of them NEVER "make it".
And if I may add, teaching this and doing this "fake it" is less than honest.

Wednesday, February 10, 2016

Guaranteed Success?

One of the things my upline used to say was that success was guaranteed if you were participating in the system of standing orders, voicemail, books and functions. And I suppose to some degree, it is completely true. However, what the downline IBOs don't realize is that the success is only guaranteed for the people who profit from selling the system. Because the system materials carry a higher profit margin than the Amway products, your upline gets to profit from your Amway volume, and then get an even bigger profit when you buy voicemail, standing order and function tickets from them.

Amway had reported that an average diamond earned well over 100K. A nice income, but not an income that can sustain the lifestyles portrayed at Dream Night or other big functions. However, add in another $200,000 a year or more and that "diamond lifestyle" looks to be a bit more attainable. The sad thing is that so few people ever reach the diamond level in the US, and even those who reach that level are often unable to sustain it. I believe the diamond club function in Hswaii for US/Canadadian diamonds had a total of 160 diamond-ships. Pretty sad for a business that has been around for so long. I also wonder how many fewer diamonds there might be today? It looks like Amway sales in north america has slipped in recent years so it's reasonable to believe there would be fewer diamonds. I wish Amway would just publish the number, but they don't so we are left to speculate and make educated guesses.

New IBOs nearly guarantee themselves of losses if they buy all the business building tools. The newbie IBOs who move 100 PV get about $10 in bonuses. That doesn't cover the cost of their voicemail, let alone the other tools. And since most IBOs are unable to sponsor downline, these IBOs are filled with dreams that will never come true. It is why the attrition rate is so high. Logically speaking, if IBOs were making money, they would stick around. But since most are losing money they quit. Also, IBOs who were deceived or lied to about the tools, will often quit and have ill feelings towards Amway. The Amway Answer Blog recently wrote an article saying they do not turn a blind eye to these abuses, yet we continue to see and hear of IBOs who were deceived by upline. I believe the only solution is for Amway to provide the training and tools. Less conflict of interest that way.

If you are seeking information or are being prospected to Amway, make sure you do thorough research and ask questions. If you hear that success is guaranteed, ask for proof, such as a business tax return (schedule C). Slide shows of mansions and cars are not proof of wealth or success. Keep in mind that the purchase of tools only guarantees success for the tool sellers, not the tool purchasers. I invite as usual, anyone to prove me wrong.

Tuesday, February 9, 2016

Amway's Broken Dreams?

One of the things Amway promoters use to entice prospects into joining is to get them to think about financial dreams and goals that they would like to accomplish. After all, who wouldn't want to be retired at age 35 and walking on the exotic beaches of the world? Or who wouldn't want to live a life of leisure and excitement with unlimited barrels of cash rolling in to finance all of the fun and frivolity? Of course most people get excited by this. Sports cars, mansions, jetskis, exclusive vacations are all the lure of what Amway promoters use to entice recruits to sign up.

Sadly, the things that people get excited by, or the things that people join for, often become less accessible because of people's involvement in Amway. Not necessarily due to Amway itself, but because of the leach organizations that attach themselves to the Amway business. These organization will promote their materials as the key to success in Amway, but in reality, these organizations reap handsome profits while basically bankrupting the downline IBOs. What is also sad is that the system does not deliver the success that is promoted. Less than one half of one percent even reach the platinum level, which is allegedly the level where you break even or make a small profit. According to stats issued by Amway, .26 reach platinum, or about 1 out of 400 IBOs. That's nothing to brag about is it?

During my tenure in the business, uplines taught us to buy all the materials. Books, standing order tapes/cds, functions, and other materials. In fact, in addition to standing order, upline wanted IBOs to purchase an additional 5-7 tapes or cds each week. Afterall, you should be listening to new material daily right? In fact, upline wanted people to "invest" or spend all of their income on these materials. In an open meeting setting, a diamond said that your family could skip a meal to get another tape/cd because the information was so valuable that you might hear the one thing that propels you to diamond. Almost as if buying a tape/cd was like some lottery ticket.

And sadly, some IBOs did go "all in". They bought tools like there was no tomorrow. In my crossline, there was a couple who went bankrupt and a couple whose home was foreclosed. Now was this financial difficulty all due to their involvement in Amway? I don't know, but certainly, buying hundreds of dollars of materials on a monthly basis can certainly contribute to someone's financial problems. And these IBOs did this on upline's advice. Thus upline advised this even when they likely knew that these IBOs were in financial difficulty. If they would tell you to starve your kids, then surely they will not be concerned about your other issues. I also sat in a function where a diamond taught about how long you can put off paying a mortgage before foreclosure would occur. Probably so people could go in hock to attend a major function.

It is a sad thing indeed when uplines will try to sell you dreams. What's worse is when they are actually selling you broken dreams.

Monday, February 8, 2016

No "Negative" In Amway?

One of the silly things many IBOs are taught is to avoid negative. I believe this is taught today by uplines and it was certainly a point of emphasis even in my days as an IBO. The upline diamond would say that the world of full of negatives and that we as people take in too much of these negatives. Therefore, the IBOs were told to avoid television, newspapers and other forms of communication with the outside world. The group was also told to avoid people who speak negatively about Amway. For this reason, many people have considered Amway groups such as WWDB or N21 as cultish or cult-like. (information deprevation or information control).

I can agree that you surely don't want to only take in negatives as it can wear you down eventually, but not seeing the news or reading about current events in the paper simply makes you apathetic and uninformed. For example, wouldn't you want and need to know if there was a deadly storm heading your way? I live in Hawaii and we occasionally have hurricanes. Avoiding news could be very detrimental to your family and home. If you lived in the midwest of the US, wouldn't you want and need to know if a tornado was headed your way? Do you avoid the doctor because his assessment of your health might not be "positive"? For these reasons, I believe that many Amwayers walk around wearing a mask with a false smile, trying to overly positive.

Another important thing that many IBOs cannot distinguish is the difference between negative and the truth. If your wife asks you if her new dress makes her look fat, the truth might be that the new dress indeed makes her appear fat. That answer may be uncomfortable for you to deliver, but the truth is the truth. The truth at times can be positive or negative but it is still the truth.

Most IBOs earn less than $100 a month. That is the truth. Most IBOs lose money if they participate in functions and standing orders and such. That is the truth. Most IBOs will never even sponsor a downline. That is the truth. Most IBOs, filled with motivation and dreams, will never see those dreams fulfilled. That is the truth. Many upline diamonds, who advise IBOs to purchase tools and attend functions, and fill the IBO's heads full of dreams, make significant incomes from the sale of tools and functions. That is also the truth. In a 1 year timespan, approximately 50% of IBOs will quit. That is the truth.

Is it negative to tell the truth? Or can IBOs not handle the truth?

Thursday, February 4, 2016

Amway Island?

Imagine an a city or island with 100 adult residents. One guy gets sponsored into Amway from a cousin in another area off the island. Well, the island residents are a pretty tight knit group so the one IBO immediately sponsors his six best friends and eventually, all 100 island residents. They are all dead serious about the Amway business so they all work hard, but because everyone is an IBO, they can only self consume 100 PV each. Thus the 100 IBOs move 10,000 PV each month. The group as a whole generates about 30,000 BV and the group receives $7500 in bonus money from Amway. Of course, the first IBO sponsored is now a platinum receiving most of that money with the rest of the group receiving smaller bonuses.

Being serious IBOs, they all get standing order, books of the month, and travel by air to functions. They pay on average about $250 a month for their Amway training/tools. Thus the group pays about $25,000 a month for the training that will one day allow them to retire and quit their jobs. The island community is losing a net of $17,500 ($25,0000 in expenses minus the $7500 in income generated from Amway) from their local economy each month. However, there is one resident IBO who is making a nice income urging everyone one. Let's evaluate the group.

The platinum IBO is making a nice income and will also receive a $20,000 bonus at the end of the year. His 6 downline friends make just about enough to break even (approximately 1000 PV) or lose a little. The rest of the residents have lost collectively, over $200,000 ($17,500 a month). The guy who owned the local grocery store went out of business and all the entertainment related business closed up because the residents had no disposable income to spend money on anything except for Amway related activities. Eventually they all quit, including the platinum because once his group quit, he too, began to lose money.

Now Amway defenders will cry that this could never happen, but it shows that even if you could get everyone in the US to join, this scenario is what would more than likely, happen. I believe the Amway name and reputation is for the most part, saturated in the US. Nearly everyone will have heard the Amway name and/or will know someone who had a brush with Amway. Because of the tool peddlers such as WWDB, BWW, or Network 21, there are likely millions of people in the US who ended up with a bad experience, perhaps tricked into attending a meeting, or lied to about something related to Amway.

While this story is fictional, it is what I believe would happen if there was a city/island where everyone joined the business. It is what happens today. Few people benefit at the expense of their downline. And as usual, it is the tools that drive people to lose money - on Amway island, or anywhere else.

Wednesday, February 3, 2016

Returning Amway Stuff?

When I was recruited into Amway, one of the catch phrases was that you are now a business owner. It sounds cool to be a business owner, but in reality, it appears that IBOs are simply salesmen for Amway who are afforded no guaranteed wage or any fringe benefits. In fact, many Amway salesmen do Amway a favor and go out recruiting other salesmen for Amway without any compensation. It makes sense though, because to attain levels of significance, you need to have downline. While it is possible (but nearly impossible) to reach platinum and even ruby without downline, any levels higher will require you to have downline.

So as an Amway salesman, you have no minimum sales requirement. That may seem like a good thing but many uplines will impose a defacto 100 PV requirement for "serious" IBOs. If you are planning to sponsor someone, your upline will likely tell you that your donwline will duplicate your efforts, therefore the 100 PV "requirement". 100 PV will cost about $300. While it is possible to sell some products, it would seem that most IBOs simply buy their own goods and do not sell to non IBOs. It's puzzling to me that so many IBOs argue about Amway's superior quality of products, yet so few former IBOs continue to use Amway products at all once they are not IBOs and even those that do, would rarely ever attain 100 PV. So much for that argument.

What many IBOs do not realize is that their upline diamonds are also salesmen. In addition to moving Amway volume, they will be selling you voicemail, standing orders, premiere club, functions, book of the month. All of these materials brings in a higher profit margin than Amway products. Thus it would only make sense that your upline salesmen would want to sell tools more than Amway products because it has more profit. Where this gets shady is when your upline tells you that they have your best interest at heart or that you virtually cannot succeed without these tools. Imagine your reaction if a vacuum cleaner salesman told you that he has your best interest at heart and that you cannot possibly clean your home without his vacuum. In an odd way, that is exactly what is happening when you purchase tools from upline. What's even worse is that the tools rarely ever work out for the IBOs who buy them. What if you bought a vacuum that didn't work? You would return it for a refund. What if the salesman said you can't return it because you used it?

I find it odd that IBOs accept this BS from upline. That you can only return unused tools. You should be able to return a product because it didn't work! Did that standing order actually help you to sponsor new people? Did you sell more products because you attended a function? Whether a tool is used or unused should not matter. You should be able to get a full refund if the tools didn't work. If not, IBOs who cannot return tools should complain to Amway and the better business bureau, and file formal complaints. Many IBOs simply quit and walk away, giving the tool sellers a break. If the tools don't work, you should return them on that basis and demand a refund. If I bought a product at Costco or WalMart and the product did not work or I was not satisfied, I can return it no questions asked. I challenge IBOs and former IBOs to do this with their products and tools.