ALL POSTSAMWAY QUIXTARMLM / Direct Sales

IS AMWAY A SCAM?

Is AMWAY a Scam? See what former Amway IBOs have to say below. Add your own opinion about Amway.

Have you ever had a good friend or close relative join AMWAY (Mary Kay, Herbalife, Quixtar, Meleleuca, Shaklee, USANA, nuskin, or other mlm, multilevel or network marketing scheme) and suddenly become the annoying sales zombie from hell?

The question came from a comment left on the post “IS AMWAY A GREAT BUSINESS OPPORTUNITY?” thirstyfox claims that Amway/Quixtar is a cultlike scam that makes everyone annoyed with her deluded sister:

My sis was in it once, wasted all her time and in the end made little or nothing.

She got back into it recently against everyones advice.  It’s like a cult that turns you against your family so you don’t listen to them. Now she has no time for family, just scamming strangers and wasting her time away with unfullfilled dreams.

The constant meetings are to keep you brainwashed.   It’s all a scam and she knows it herself now as she tries to get others in “under her.”  Hard to see her as a Christian anymore when she does this, and it’s sad to see all the time she loses when she could be raising her kids.

I’ll never understand how she could be so stupid. I asked her why she got in it last time and she said of course money.  Then I asked her what she got out of it and she replied defensivly “I met a lot of very interesting people!”  I think that about says it all and if it didn’t work for my sis it won’t work for anyone.

All the BS they tell you about how well this that and the other person did or is doing is all lies so they can get your money.  98% of all Quixtar products are sold ONLY to stupid Quixtar members themselves, yet they go around saying they own a business???

Don’t give them a second of your time.

What do you think?  Does Multi-level “Network” Marketing consists of stupid, annoying members selling worthless stuff to other stupid, annoying members?  Share your MLM story below.

ARE YOU AN AMWAY IBO OR FORMER AMWAY IBO?
DO YOU THINK AMWAY IS A SCAM?
PLEASE SHARE A COMMENT BELOW.

Contact UnhappyFranchisee.com

Read more on Amway:

AMWAY Addiction Kills Marriage

AMWAY: Is Selling Amway Child Abuse? Amway Kids Weigh In.

AMWAY Partner Store Claims Embarrass Their IBOs




1,020 thoughts on “IS AMWAY A SCAM?

  • Beenthere

    While, legally speaking, the Amway business structure is not a pyramid, but the “tools” systems that seem to accompany all these large distributor organizations seems to be.
    Business was slow today, so I spent time looking around at various Amway critical and Corporate, Distributor sites, out of sheer boredom. I t makes for some pretty interesting reading. I saw that there are presently somewhere around 300,000 distributorships in the US (or is it North America), at one point, while I was in the business, I’m going to guess around 1980 or so, there were over a million. There was a time when I being approached very often but it has been years since anyone has approached me, maybe I’m just too old now :)

    Seeing the power these large corporate distributorship wield, it’s easy to see why the Corporation is submissive. If the Britt group decided to pull out it would have a serious impact. I don’t think thats what DeVos and VanAndel intended, but ultimately they caved in.

    @infofightback – I understand the point you’re trying to make, but it doesn’t quite fly. Someone at the highest levels may have had many people come before them who are no longer “above” them. When you reach certain milestones (and I see the names given to many of the levels have changed over the years) you essentially break off into you own little period “pyramid” (for want of a better term) that you stand at the top of.

    I wonder how many Crown Ambassadors there have ever been in Amway and how many of that number still qualify at that level. Over the years and many millions of people who have been in and out of the business it is a very small percentage indeed. It is actually quite a good representation of what results in our overall capitalist system…there are very few at the top and the truth is very few people have the right stuff to make it to the top in any given business. The trick in real life is to find where you have the greatest potential by exploring and keeping an open mind, and not listening to someone who claims to have prepackaged pathway to success. That doesn’t exist…unless you’re born into it.

  • I don’t know why every scam has to be crammed into the shape of a pyramid. The tools aren’t a pyramid, they are a bait-and-switch scam. Amway and the upline LCKs LIE about where most of their profit comes from, plain and simple RICO fraud.

  • Be Real

    Tex, why do you have such a vendetta against Amway? I think it’s a bad idea to join but you take it too far.

  • How can a multi-million person, 3-4 decade long, 10s of billions of dollars scam be taken “too far?”

    The point is that no meaningful change has occurred, which indicates we haven’t gone far ENOUGH.

    You need to act as your name implies and “Be Real.” LOL

  • Be Real

    I am being real. Who apppointed you as the judge and jury to do something about Amway? By the way, your tool scam post on your blog should be abbreviated. Nobody wants to read all of that.

  • No, you’re Being Real stupid. I appointed myself via the First Amendment of the U.S. Constitution. If there were more people like me, there wouldn’t even BE a tool scam, but most people are like YOU, Be Real (Wimpy) and don’t have the guts to speak the truth or the brains, Be Real (Idiotic) to work with others to fix problems. By the way, if you had gone past 3rd grade in school, you would find my post informative, but your USA Today microwave brain can’t process that much information, can it, Be Real (Dense)?” Next time speak for yourself, Be Real (Retarded) because others can read it just fine. LOL

  • Be Real

    I did speak the truth. It’s not a good idea to join Amway because you are likely to lose money in the process. I’m not heavily invested in Amway where I want to spend all my time trying to shut down their “tool scam”. I speak my piece to warn others and if they join, then it’s caveat emptor.

  • What “truth” did you speak? The part about “Who apppointed [sic] me as the judge and jury to do something about Amway”? That isn’t truth, that’s a stupid, non-productive question.

    The fact that you can’t read for more than 3 minutes at a time? How is that the truth?
    You can’t even think, let alone speak the truth.

    It’s important to know WHY someone is likely to lose money. Otherwise, you look like a kook. If you don’t care about others being scammed, leave the conversation to the adults and complain about someone else being the “judge and jury” and their posts are “too long” somewhere else. LOL

  • Be Real

    @tex, if you’re so smart and devoted to stopping the “tool scam”, why hasn’t it been stopped?

    Better to just tell people not to join. I bet that does more than to try and stop the tool sellers.

  • This thread has a persistent tendency to revert back to personal attacks.

    Please follow this guideline: Attack the argument, not the arguer.

    Thanks!

  • The personal attacks started on the post dated October 31st, 2011 7:50 pm.

    If you’re going to enforce your “no personal attacks” rule, start by removing the posts from there into the future, as you agreed to do!

  • This message from Be Real wasn’t a personal attack, it’s a display of their ignorance, and here’s my response:
    @tex, you are a loser. —> How can I be a loser? I haven’t given up. The “game clock” is still running.

    You’re wasting your time. —> How do YOU know?

    What of actual substance have you accomplished in shutting down the evil tools scam? —> If you count being sued by Amway, and now they’re running with their tail tucked between their legs, I’m winning!

    Nothing, nada, zilcho. —> See above. That is FAR from zero. Plus, I’ve just started to work with a couple of other people who want to FIX the problems, not just WHINE about them, so stand by for even more progress. When we win I’ll be happy to point out who was helping and who was merely whining. LOL

  • Be Real

    @tex, for all of your time and efforts, why is Amway and the tool scam alive and well?

  • The Amway Tool Scam is not “alive and well” in some countries, such as the UK and India. The main reason is these countries’ governments took action. However, I live in the U.S., and it is under increasing pressure here as well, mainly on the internet, but not from the government (at least publicly). These changes don’t happen over night, I am one person, and Amway is a mulit-billion dollar/year company. Is that a situation you would describe as “alive and well?”

  • Be Real

    It is alive and well in the US. It is apparent that the governmental regulatory agencies either do not care or have been “bought off’ by Amway and/or politicians who are influenced by Amway.

  • It is sick and dying in the U.S. Check out the latest Achieve Magazine: http://www.achievemagazine.com/ Most of the people now qualifying are of Hispanic or oriental descent, because most English speaking people have more access to the internet where the facts about the Amway Tool Scam reside. Once the word gets out to these other groups, Amway will be forced to change or die. The regulatory agencies in my opinion are, in order of significance, incompetent (think Harry Markopolos and Madoff), bureaucratic (related to incompetence but an extra barrier), and politically influenced. That simply means we need to work harder, but that doesn’t mean we give up. Other peoples’ lives and finances are worth it.

  • Good material?
    That’s a laugh. Maybe it improved. I stopped reading it after this whopper on page two – “in fact with their endless chain of recruitment, they create thousands of middle men”

    The author clearly hasn’t bothered to actually study multilevel marketing compensation plans, which “in fact” do nothing of the sort.

  • I suggest this blog owner moderate ibofb’s posts until he answers the question I asked him a few weeks ago:

    Tex on October 11th, 2011 9:01 pm
    ibofb,
    You are ignoring the net profit portion of the question, as usual.

  • Mi Nombre Es

    ibofightback, I ask you, is the chain of recruitment endless? Are you told to build your team and then help your team build their own teams…. under you? I would consider that an endless chain.

    As for the middle men, LOL in order to have “middle men”, you have to have goods or services moved to consumers. Amway has them, but they’re sitting in IBO storage.

    Answer Tex’s question. Don’t attack, don’t work around it. Answer it straight forward.

  • Be Real

    Amway is a pyramid chain of recruitment. It”s not illegal because Amway “says” they have products to sell and that IBO’s are supposed to sell said products. In real life the reality is different. IBO’s also do not get directly compensated for recruiting but teh reality is that serious IBO’s are always focused on recruiting because you can’t go emerald or diamond without downline.

    Bottom line. Amway is a scam without success unless there is an endless chain of recruiting. And to illustrate this, if everyone joined, there would still be only 1 in 100 or 200 that reach platinum.

  • *Any* product distribution system is theoretically “endless” chain. I can buy something and sell it to you, who sells it to someone else, who sells it to someone else etc etc. Or I can recruit you in to my sports club or church, or whatever, and you can recruit someone who can recruit someone … endlessly, or at least until the people ran out.

    What’s important in business (as opposed to an actual pyramid scheme) is the distribution of money, and *that* brings is to where the statement is a “whopper” – “they create thousands of middle men”.

    It does no such thing. The FTC analysed the Amway distribution chain more than 30 years ago, and the number of “middlemen” was remarkably similar to traditional distribution systems.

    Anyone who thinks the Amway MLM model creates “thousands of middle men” has no idea how the model actually works. The chain breaks, it’s not endless.

    Mi Nombre Es – any IBOs holding product in “storage” is (a) violating Amway’s rules (b) in doing so deliberately defrauding Amway and/or their upline in order to qualify for commissions they don’t deserve (c) a complete idiot.

  • Be Real

    @ibofightback,

    Any distribution system is theoretically and endless chain. While that might be true, the difference is that in a traditional business, all of the people in the middlle get paid. In Amway, all of those middlemen are folks who think they are business owners in a system that basically requires an endless string of recruitment. If it takes about 100 to 200 to make a platinum, that means that even if the whole world signed up for Amway, 1 in 100 or 200 would be platinum. That means that at best 1% can be a platinum and at worse, less than that. I understand that platinum is where someone starts to make decent money. A system where only 1% at best can succeed is not one that is worth the time and effort to expend. That’s the truth, the whole truth and nothing but the truth.

  • @Be Real (who sound remarkably like JoeCool – are you related?) –

    You are incorrect. It does not require “1 in 100 or 200” to be platinum. It requires 7500 or 10000PV of volume a month for 6 months (varies across markets). There is no requirement to recruit anybody, indeed not even a requirement to generate that from more than 1 retail customer!

    It seems however that you believe that all business is a waste of time? In general, all businesses require people who are not making money from that particular business to purchase products or services in order to make money.

  • Be Real

    @ibofightback,

    I’m not JoeCool. Paranoid much? I’m simply looking at numbers. Yes, 7500 points is the equivalent of platinum. A platinum is going to have 100 to 200 downline. Is that true or not? If it is true, then less than 1% reach that level. That is a fact. If everyone in the world joined Amway, that would not change. Why would someone want to join a business where 1 out of 100 or 1 out of 200 make decent money? There are definitely better opportunities out there. If you are saying this is a good deal, you are misleading people. Have you made money out of this business? If so, how much and how much of your time is dedicated to it?

  • I know people who’ve qualified platinum with less than 100 people registered in their network. I know people who have qualified with more.

    So what?

    yes, less than 1% of people who register with Amway reach Platinum.

    So what?

    Why are you assuming, contrary to all independent evidence (eg FTC, BERR, TEAM vs Quixtar), not to mention common sense, that everyone who registers with Amway is trying to reach platinum?

    I’m registered with Amway. I’m not trying to reach platinum. I just buy the products. On what basis do you think that contributes to making Amway a poor business?

  • Be Real

    @ibofightback,

    Yes I would say some people can qualify at 7500 with less than 100 downline. You could argue that one person could sell 7500 and also be platinum. But in a conventional group, it would consist of 100 or more IBO’s. They may be IBO’s who sign up just to buy some items and some are trying to go diamond and some don’t do much of anything, but a platinum group of 100 or more is not uncommon. On that I believe we agree/ It seems we agree that less than 1% reach platinum. My question is why someone would invest time and money to pursue a business where less than 1% reach a level where decent money can be made. My thought process is that it is easier to work a job to earn extra cash than it would be to make a decent income from Amway. I guess I don’t understand why you would run a business just for a discount on goods and services from Amway. You registered with Amway just to buy goods? Doesn’t that make you a buyer’s club customer?

  • (1) on what basis are you determining, for people other than yourself, what “decent money” is? If somebody wants to make $100 a month, and does so, why do you consider them a “failure”?

    (2) If you open a clothing store, and, statistically, it requires you to get 100 customers to make that store “decent money”, does that mean that clothing stores are poor businesses that shouldn’t be pursued?

    (3) On what basis do you believe someone who is registered with Amway and just buys goods and services is “running a business”? Would the tax authorities in your country consider it “running a business”?

  • @Ibofback,

    Why do you ignore tex question “You are ignoring the net profit portion of the question, as usual”. It makes you look as if you have something to hide or are simply afraid. Maybe that’s not the case, maybe you have your reasons, but why not answer the question?

  • @anon, – like I recommend any sane person do, I simply ignore anything Tex says. He is not well.

  • Guest

    anon wrote “Why do you ignore tex question “You are ignoring the net profit portion of the question, as usual”.”

    That’s actually not a question. What is the net profit question?

    anon, why don’t YOU ask ibofightback the net profit question, since he ignores Tex’s questions.

  • Be Real

    @ibofightback

    (1) on what basis are you determining, for people other than yourself, what “decent money” is? If somebody wants to make $100 a month, and does so, why do you consider them a “failure”?

    Agreed. If someone wants to make $100 a month and does it, that’s all good. Correct me if i’m mistaken but don’t most Amway presentations promote lifestyles, residual income, going diamond and money beyond your dreams? I sat in on more than one presentation and it was like that each time.

    (2) If you open a clothing store, and, statistically, it requires you to get 100 customers to make that store “decent money”, does that mean that clothing stores are poor businesses that shouldn’t be pursued?

    That is an unfair analogy. A more appropriate one would be if one out of a hundred clothing stores made a profit, then a clothing store would be a bad investment.

    (3) On what basis do you believe someone who is registered with Amway and just buys goods and services is “running a business”? Would the tax authorities in your country consider it “running a business”?

    Agreed, so why does Amway offer that as an option? I can be a costco member with buying priviledges but I don’t own a costco business when I sign up.

  • (1) Our experiences are different. Every Amway presentation I have ever seen (and I’ve seen many) has given a range of possible incomes, from small amounts to large amounts. Indeed it’s virtually impossible to explain the larger amounts without going through the smaller amounts, so I’m not sure how the presentations you saw managed to do it. The Amway Opportunity Brochure, which is required to give to all prospects in North America, says –

    “This is your business and only you can determine how much time
    and effort you want to put into it and what you want to get out of
    it. Determine what success means to you, then work with your
    sponsor and the Amway IBO Compensation Plan to create your
    individual path to success.”

    (2) Your analogy isn’t better, it’s even further away from the Amway model. (both analogies are lousy actually), You don’t need to “open 100 Amway businesses for one to make money”. You can make money by just opening one, your own.

    (3) You don’t own an Amway business just because you register as an Amway IBO either. You have the *right* to operate one. Whether you’re running a business or not is not Amway’s to decide, no matter what label they may give you.

    Some MLMs reclassify people as “member customers” and similar things if they’re not doing things to actively build a business. Critics then assail them claiming they do so simply to improve “average income” statistics. Amway chooses not to go that path, primarily because the way they do it now got the blessing of the FTC forty years ago so their lawyers are happy just to stick with it.

    Amway does in some countries offer a “membership” option, but it causes it’s own problems as some people can and do want to change back and forward. They might want to operate as a business for a few months to make some cash, then spend a few years simply as shoppers, then make some money again. Reclassifying people is problematic, whereas just putting everyone in the same category and letting them decide what they want to do only really has the downside of giving ammunition to critics of the business model.

  • Guess wrote: “why don’t YOU ask ibofightback the net profit question, since he ignores Tex’s questions”

    Why should I?…I wasnt challenging any view points with my statement, I am just a person looking into both sides of the issue and learing from it.

  • anon, i wasn’t criticizing you. I looked back and couldn’t find the question Tex was referring to. I’d have asked it if I knew it.

    like you, I’m just trying to understand both sides. sorry if it came across wrong.

  • I don’t know what Tex asked, as I said I don’t read his posts. From “net profit” though it’s probably a standard leading, and unanswerable, question of Amway critics. Amway reports some statistics on gross income (ie after cost of goods sold) but they have no statistics on IBOs expenses, which vary greatly. You have people like myself, who are registered as IBOs but not working the business, and my only “expense” is my yearly membership fee, akin to CostCo. Then you have people like (critic) JoeCool, who when he was an IBO was reportedly flying from Hawaii to the US mainland for conferences.

    From past encounters, critics like Tex and Robert FitzPatrick seem to ignore the fact that the majority of registered IBOs are more like me than JoeCool. The vast majority for example don’t attend seminars or purchase CDs/tapes/books etc. Statistics used within various groups for example, generally reveal that out of that 100-200 people you might find in an “average” Platinum group, only 10-20 are actually spending any kind of significant time or money on their “business”.

    Some MLM critics, like Robert FitzPatrick and, I think Brent Hansen, also like to include distributors purchases for personal use as a “business expense”. This is absurd, and I’d like someone to try that one on the IRS. If a dstributor buys products for personal use, it’s actually an *income* for their business, not an expense. Of course an profit from it will normally be annulled by the expense of purchasing, but not always as it may help contribute to a larger volume rebate.

    Having said that, in some MLM companies (not Amway) there are requirements for people to be registered on “auto-ship” programs in order to qualify for bonuses. These are what Brett Hansen in particular focuses on in his analysis claiming “mathematically guaranteed 99% failure”. In my opinion they’re very dangerous, as there is a clear risk that people will be automatically getting shipped products they don’t legitimately want or need, and which they won’t (or can’t) make the effort to sell. That’s illegitimate demand and takes you into pyramid territory.

    In Amway people order products for customers, or themselves, when they get the order, there’s no autoship requirement to qualify for bonuses.

  • Forget to finish answering the “net profit” part. In short Amway doesn’t know everybody’s expenses so they can’t report them. Even if they did they’d almost certainly be so non-homogenous as to make calculating any “average” statistic completely meaningless. Some people might need to make $2000/mth to reach net profitability, some might need $10.

  • Ibofighback wrote:
    “You don’t own an Amway business just because you register as an Amway IBO either. You have the *right* to operate one. Whether you’re running a business or not is not Amway’s to decide, no matter what label they may give you”

    I don’t think any IBO owns a part of Amway; but they can sell amway products as 1099 self employed. However, isn’t it amway who is promoting that you become a business owner just by registering as an IBO? Doesn’t “IBO” stands for “Independent Business owner”?

  • @ Ibofghtback

    As for the net profits, I see your point. It is very difficult to know how much each IBO is spending a month. However, what I can tell you is that most IBOs I have encounter, and as far as I have heard, are regularly trying to present the plan by going outside of retailer stores and supermarkets; and they attend meeting on a regular basis. It will be very difficult for me to believe that these people are only spending about $10 a month on their business—but hey, who knows?
    Additionally, why would and IBO want to pay about $165 or more to become an IBO if he was not motivated to work the business in the first place—If he wanted to consume, he can simply become a member consumer ( where I live membership is free as I understand it, and you get the same price on products as an IBO). But again, I don’t know, I am simply looking at different view points.

  • @anon1 – as I said, doesn’t matter what label Amway wants to give you, if you’re not running a business you’re not running a business. I’m an authorized Microsoft Partner and Reseller, but I don’t resell MS products, so I’m not reselling, even if Microsoft gives me the label. It’s just marketing.

    Re registering, in the US it’s costs $50 to register as an IBO, not $165. In other countries it’s cheaper. In some it is free. In some it’s more expensive (but usually with sample products). Only a handful have a “member consumer” option. Even where there is a “member consumer” option it can be worth registering as an IBO anyway. For example, you might buy enough just for personal use to qualify for a bonus occasionally. Or maybe you know one person who is interested in registering and running a business, so you join and sponsor them and then just go back to being a shopper. Their volume contributes to the discount you may get on your own shopping, thus getting stuff cheaper. Or, maybe like the example I mentioned before they’re someone who moves back and forward between running a business and being a shopper.

    Heck, just last week a friend said to us “I have a friend who has just moved her from Ukraine and wants to buy some Amway products, can you get them for her?” We said yes of course, she’s on her way to pick them up right now. The profit is going to more than cover our yearly membership fee.

    Are we running an Amway business? No. I don’t need to register it as a business as activity is too low, and that income is well below the “hobby income” threshold here.

    But heck, that one sale makes me “profitable”, but people like Tex and FitzPatrick will declare this iboship an “Amway failure” because it’s not making some arbitrary amount that *they* decide.

    I must ask though, how do you know how many IBOs you encounter? I saw statistics once that indicated something like 1 in 8 adults in the US are registered with one or more Direct Selling firms (whom are overwhelmingly MLM). How many people did you meet today? How many tried to show you the business? How many people do you meet that are IBOs and you don’t even know it because they’re not acting in the way you think they act?

    As I already mentioned, only a small percentage of IBOs ever attend meetings or subscribe to tape or CD programs or present the plan. Very very very few do so regularly. Less than 1% ever do so for the time recommended to build up a full-time equivalent income. It’s no coincidence that a similar percentage actually make a full-time equivalent income.

  • Be Real

    @Anon & ibofightback,

    Out of curiosity, where can I find these stats indicating that a lot of IBO’s only register to be customers and that only 10% or so are participating in a system. I looked at the Amway website and this information doesn’t appear there.

  • Amway Japan annual report from a few years back had statistics on why people join. Last time I looked for it it was no longer online. dsa.org has lots of industry statistics. Amway’s bizopp brochure reveals only 46% fit in to their definition of “active”, which you’re considered merely by attending one meeting or attempting one sale or earning a bonus (including just on your own purchases). The Team vs Quixtar lawsuit revealed only 12.9% build a downline and earn a bonus on it. BERR vs Amway revealed only 6% actively retail. I outlined some of these statistics in the following posts –

    * Amway IBOs get all their products free plus extra cash!
    *Updated Amway IBO average income statistics, plus an important clarification
    *Amway Success – What are your odds?”

    “system participation” has nothing to do with Amway per se, so they don’t, and can’t, really have statistics on it. The companies that do provide this information do keep statistics which are you used to develop their business strategies.

    An old example, outdated but gives you an idea, is here from WWDB. It shows what the consider the “ideal” parameters for a growing business. A non-ideal business (which is probably the norm) will have *fewer* people “on the system”.

    You’ll see it has a “Ruby Platinum” (which is roughly twice the size of a normal platinum) with 80-180 total IBOships and 40 to 80 people attending seminars. Note that most IBOships are couples, so would count for two attending seminars. A significant number are also prospects, ie haven’t registered yet. So at the lower end of a good healthy Ruby business in WWDB, you have at most around 1 in 4 registered IBOships attending seminars.

    I heard Jim Dornan, who has one of the largest Amway networks in the world, and also owns one of the largest training companies, say recently that people in attendance at seminars typically represent less than 10% of the people actually registered in his organisation.

  • Be Real

    @ibofightback,

    Okay, it sounds reasonable to assume that roughly 10% of people are working the business. But is there any way to know how many have registered only to buy products? That sounds a bit nebulous. Also, out of that 10% who are working, how many are actually making money (net)?

  • First problem with this line of questioning is that people have multiple motivations, and motivations change. you may join to make money , then decide you’ve got other priorities right now, which may change in the future, so you maintain membership to get the products and allow options in the future. Or you might join just to buy products, then decide to build a business. Or, even more likely, both of these motivations have some role to play, plus other motivations (eg I joined to help out a friend, whatever).

    It is inherently nebulous.

    Shaklee, a company very similar to Amway in products and operations, reported to the FTC in 2009 that 85% of people join that company as “wholesale buyers” rather than distribute the products. The Amway Japan report I mentioned, but can no longer find, had something like 78% joining primarily for distributor pricing. (I think they may have a more attractive “member shopper” option now, so may have changed).

    But, as I noted in some of the links above, you can look at statistics of what people actually do and get an idea. From the data presented in Team vs Quixtar, around 78% of distributors who renew are not earning any group commissions – ie they don’t have a downline making them any money, most of them don’t even sponsor anyone. Yet they renew.

    Why? Why would they renew if they’re not earning any money at all (and it’s really quite easy to earn a downline bonus)?

    Because they want the products at distributor pricing, or delivered direct, is the logical answer. Of course there may be additional motivations (eg “I might build it someday”), but clearly that’s not a plausible primary motivation for most of them.

    Next issue, re those working, is that the 10% isn’t fixed. It’s not the same people every month, though there is a core of consistency, and it’s no surprise that it is those that go on to decent incomes. How many are making a net profit? Impossible to tell, since none of them are required to report expenses to Amway. JoeCool will tell you he was still losing money at 4000PV. Tex will claim people make a loss until Platinum. A (very) old and (very) flawed Wisconsin study claimed most with the label “direct” were losing money. On the other hand, when I did build an Amway business I was profitable by 1000PV.

    It’s interesting to note that “critics” who claim they weren’t making any money, or losing money, almost universally report they were taught or encouraged *not* to have full retail price paying clients, merely to focus on recruiting people, including wholesale price shoppers. People like myself, who report having made money, were part of groups that encouraged people to have full retail paying clients.

    20-30% profit margins, plus volume bonuses, make it a lot easier to reach break even point and behind, even with no sponsoring at all.

  • “@anon1 – as I said, doesn’t matter what label Amway wants to give you, if you’re not running a business you’re not running a business. I’m an authorized Microsoft Partner and Reseller, but I don’t resell MS products, so I’m not reselling, even if Microsoft gives me the label. It’s just marketing.”

    If you are saying that you are not an independent business owner just by becoming an IBO because you have to run the buisness, and if this is true, than can we conclude that amway is using deceptive marketing practice, since it is Amway who is promoting that you are and IBO( Independent business owner) as soon as you sign up? and If this is a deceptive title/label that amway gives you, doesn’t this opens up the door for deceptive practice to people who are not very business oriented? “how would you like to own your own business?”…”as soon as you sign up you become an Independent busines ower, or IBO”

    You are and Authorized Partner and reseller for Microsoft as you stated, but they don’t call you and Independent business owner.

    As for your question as to how many IBOs I ecounter: a couple withing the last 3 years. But I never said that I consider a bad behaivior for IBOs to go close to retailer stores and supermarkets to try and recruit or sell; Kudos to them for tryig to make their buisness work.

  • Oh, an by the way, when I asked how much it cost to sign-up, it was either $165 or $168—I can’t remember exactly, but definitely not $50.

  • I don’t think I’d call the label “deceptive”. Inaccurate yes, but it’s no more deceptive than me becoming a Microsoft reseller, or getting a sole trader “business licence” in some states. I might have the licence, doesn’t mean I have the business. Those states probably report the number of licences somewhere as businesses, is that deceptive? No, just inaccurate.

    It would only be deceptive if people believed that simply getting a licence was all you needed to do to actually own a business

    Seriously, is there anyone dumb enough to think that just by signing up as a reseller of something– Microsoft, Amway, Amazon – that it means you actually own a business?

    Perhaps more importantly, does anyone pay money for that reason? Or is it for the business they could potentially develop?

    Re recruiting/selling at supermarkets and retail stores, it’s (a) nearly always against those stores/malls regulations and (b) very ineffective (c) possibly against amway rules, depending on the market and how it’s done.

    In other words, anyone doing it is probably on the fast track to a failing business.

  • US membership fee is $50, but people will often recommend a range of other purchases, such as sample products or training materials. The Amway signup form itself in the US lists optional membership in the IBOAI (kind of like a union) and an optional product sample pack. Added up it comes to just under $168, but only the $50 membership fee is necessary (it’s all I paid)

  • Mi nombre es

    ibofightback, why are you in Amway? Everyone wants to make money and move up in their respective career, so I assume why wouldn’t Amway IBO’s. If you are not looking to climb up, then I ask, what is your goal at Amway?

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