eirik
Muse
- Joined
- Jan 16, 2008
- Messages
- 729
-
Security incident: ISF was recently accessed by intruders. Please change your password, and change it anywhere else you used it. Read more
I'll have a read on these this week.icerat
Philosopher
It's veracity is reasonably verifiable if you understand the Amway compensation plan and follow publicly available information about high achieving members of their downline.
icerat
Philosopher
No.
Actually the figure is old and I suspect it's higher now.
Say what? We're talking revenues, not profit - total sales for their entire network.
It's the total sales (at wholesale) for their entire sales network. If you're a widget wholesaler/retailer and you supply widgets to two other widget wholesalers and/or retailers, your revenue includes your own personal retail sales plus your sales to the other widget suppliers. Quite evidently your resellers cannot sell more of your widgets than you sell to them, and if you can't sum their widget sales and your widget sales together, you'd be counting as revenue sales of the same widget more than once through the supply chain.
OK, I think I get it. This person sits at the top of the pyramid and has revenue of 4 billion (or rather, their network has that figure). Someone else sits below that level and has some smaller (but probably still huge) revenue for their side of that same network. And so on, down through the pyramid until you get to someone who doesn't have much revenue at all.
This is one of the complaints about Amway isn't it? The few at the top with the top dollars? How does this relate to anything? If I met the CEO of McDonald's, I'm not sure how his/her income would matter to a line cashier, or even a franchise owner.
We already know there are a few at the top of the pyramid. The reason people say Amway is a con, isn't because of them, it's because of how wide the base of the pyramid is and the difficulties in moving up.
icerat
Philosopher
In reality it's not pyramid shaped, but that's another discussion
If it is, then the same complaint can be made about every single product business in the world. The manufacturer of a widget will self-evidently always sell more of those widgets than anyone else. The exports/wholesalers/distributors they sell them to will always sell more of them than anyone they sell them to. (theoretically I suppose they could sell the exact same amount if they just had one customer who bought all their stock).
The usual complaint is that "the people at the top" make all the money, and that's patently false - obviously so to anyone who actually bothers to study the marketing and compensation plan instead of just assuming it's a pyramid plan. Heck, I make more from Amway than the person who sponsored me.
You appear to be mixing revenue and profit again. The Dornan business upline - ie people "higher up" the distribution heirarchy have greater sales turnover than his business does, yet I'm fairly certain none of them make as much profit as his business does.
You don't "move up" the distribution heirarchy. Just like any other business you find and maintain customers - you create a heirarchy.
The Dornans started with zero sales turnover. They found retail customers for the products and services they were marketing, they found resellers for the products and services they were marketing.
How is this significantly different to anyone starting any business?
Zelenius
Muse
- Joined
- Jul 8, 2008
- Messages
- 908
Amway a scam? Oh c'mon! My cousin's, barber's, sister's, God-mother's, pool cleaner's, dentist's, brother-in-law makes around $800 million a year from Amway. And he only works 5 hours per week doing Amway, he is that good at Amway. Don't forget that he started at the bottom! He was originally a janitor! He was a poor immigrant who came to the U.S as a young man, totally penniless, suffering from tuberculosis, scurvy, pellagra, beriberi, Crohn's disease, plantar fasciitis, rickets, and covered in fleas! Besides this, he couldn't speak any English!
Nowadays, he spends most of his time on his yacht cruising around the world. When not on his yacht, he often hosts or attends lavish parties with various world leaders, business leaders, Hollywood big-shots, and so many amazingly beautiful women that even Hugh Heffner in his prime would have been jealous. He's a frequent guest flyer on Air Force One. He has palaces, mansions and penthouses full of treasure all around the world. He has an ever-growing fleet of Porches, Lamborghinis, and Maseratis. He uses $100 bills to wipe his butt.
All because of Amway. What an amazing opportunity! All he did was work hard. Anyone can be as successful as him at Amway if they work as hard! And some people claim it's a scam? Please!
Nowadays, he spends most of his time on his yacht cruising around the world. When not on his yacht, he often hosts or attends lavish parties with various world leaders, business leaders, Hollywood big-shots, and so many amazingly beautiful women that even Hugh Heffner in his prime would have been jealous. He's a frequent guest flyer on Air Force One. He has palaces, mansions and penthouses full of treasure all around the world. He has an ever-growing fleet of Porches, Lamborghinis, and Maseratis. He uses $100 bills to wipe his butt.
All because of Amway. What an amazing opportunity! All he did was work hard. Anyone can be as successful as him at Amway if they work as hard! And some people claim it's a scam? Please!
Last edited:
I have no idea how much effort you put in. You claim to have personally invested thousands of hours (several man-years) in a non-Amway business which has yet to generate any revenue and yet seem to be disinclined to invest time in an Amway business which you claim does.
It sounds like your Amway business in March (I don't know how much time you spent) generated profits of $1000, by contrast in that first month (for around 200 hours effort) my business generated profits of a little over $10k.
Of course the key difference is that my business has generated profits and delivered salaries for my employees (though rather fewer of them 2008-2011) for 11 years
Well if your Amway business sells only to complete strangers you're unusual and you're choosing the difficult way to do it. My experience with sales (in a past life I have run sales teams) is that it's always easier to sell to people who know you.
eirik
Muse
- Joined
- Jan 16, 2008
- Messages
- 729
I had a read on Dornan last night. I have trouble verifying his annual income in the eight figures as you stated, or a revenue of $4 billion. Several MLM websites have estimated the Dornan *couple * income as $4,2 million in 2010, but they site no sources.
Taken at face value, although impressive, its not close to the $100s of millions as you claimed.
What I did read however, is that Dornan's network 21 basically was (is?) a business model *within* the Amway business model, selling tools to IBOs. Sounds profitable. And that is sort of what we talked about in this thread, that the mlm-model is just a scheme for selling tools, where the real profit lies.
I would be interested in the isolated profits on tools, on his down line, and of selling Amway products. I suspect profits of the latter is abysmal.
If that is true, it's an argument for the notion that amway is in fact a pyramid scheme. The profits does not come from product sales.
psionl0
Skeptical about skeptics
icerat
Philosopher
The potential payoff for the business ideas I'm pursuing is greater than for an Amway distributorship. The likelihood of it paying off more than an Amway business for the same amount of work is lower.
I have the freedom to take risks with my time if I so choose.
And my original Amway business has generated profits for me for more than 15 years. With nobody apart from Amway (including myself) putting any time in to that business. It's helped delivered salaries to Amway employees
Please don't misrepresent what I said. I didn't say I sell only to complete strangers. What I don't do is try to "make" anybody buy "overpriced products", which is what you falsely stated I do.
Last edited:
icerat
Philosopher
There is no source for that either. It originates as nothing but guestimates from a guy with a blog. You can discard pretty much all the figures on that site. My source is not public, but shall we say, closer to the source.
Network 21 is a separate for-profit company, yes. It supplies products and services to Amway IBOs both within the Dornan's amway network and others.
The average Amway income in the US alone for Founders Diamond businesses in Amway is just over $590,000/yr. The Dornans have a Crown Ambassador business in the US - at a minimum around 4 times the size of a Founders Diamond business. They also have confirmed Amway businesses of Founders Executive Diamond or higher (a minimum of 33% bigger than a Founders Diamond) in at least 6 other markets (Australia, India, Scandinavia, South Africa, Turkey, Philippines) as well as Diamond in China, plus unconfirmed reports of the same in several other countries. Back in 2000 - before Amway significantly increased bonuses and payouts - it was reported the average US Crown Ambassador earned over $3.3 million from that market alone.
As you can see, that all adds up to Amway income at worst of 7 figures and heading in to 8 figures.
I'm astounded you would consider even 7 figure incomes to not be "real profit", let alone an 8 figure income.
Your categories are not mutually exclusive. Profit from downline is profit from selling Amway products. As established above it's at least 7 figures, and I can assure you it's 8 figures. Not exactly "abysmal" in my book.
I seriously sometimes get the impression that people are completely cluess that there's a whole wide world out their of businesses that sell primarily to other businesses. You know, hardly known names like Coca-Cola, or Procter & Gamble. Amway distributorships start as primarily retail operations, then as they grow move towards being primarily wholesale operations.
*All* of the Amway profit comes from product sales. ALL of it. If you think wholesaling makes something an illegal pyramid, then you've just damned the vast majority of the modern system of product distribution, marketing, and sales.
I'm also astounded how many internet pundits think that after a few minutes on the internet they know better than official bodies and business experts around the world that have declared Amway is not a pyramid. The FTC in the US spent nearly 2 years studying the Amway marketing plan, interviewing hundreds of witnesses and studying thousands of documents. They explicitly stated "The Amway Sales and Marketing Plan is not a pyramid plan". Many other things that critics claim happen with Amway they studied and explicitly stated were false, yet people continue to believe and spread them. What's most disappointing is when participants in a forum that prides itself on rationality does so.
Get off the amateur blogs and start reading actual books and papers by experts.
Of course you are free to do this. I'm just questioning the wisdom of investing man-years of your time in one scheme which has yet to yield benefits when there is another which you claim could earn far more than it does but you lack the time to devote to it.
If it has the potential to generate more than $4bn in sales (which you claim is possible through Amway) then good luck to you.
I don't really know what to say to you about this, partly because I cannot easily parse it (but as someone who would find it very difficult to post in my second or third language I certainly cannot be critical). You seem to be saying that you draw an income from an Amway business into which you no longer have to invest any time or effort - that's great. That seems to be the thing you want to scale, not the other business opportunity into which you have invested man years of effort or indeed your latest Amway venture which would be a great money spinner if only you had the time to spend on it.
As you say, your time is your resource to invest as you see fit.
So you do pressure friends and family to purchase from you, glad we got that straight. I know you don't think that Amway products are overpriced - I disagree.
icerat
Philosopher
Again, please read what I said. I said the exact opposite to what you are claiming. The venture (in no way a "scheme") I've been putting my time in to has the potential to make more than an Amway business, but has higher risk.
I'm not interested in sales, I'm interested in profit.
English is my first language, though admittedly after 15 years of living in a non-english speaking country it has gotten worse.
Yes.
Bingo. Yet "critics" seem to think if someone registers with Amway it automatically means they're working hard to build a profitable business. Either that or they think you should make money just for joining, not actually doing anything - in other words they're disappointed it's not a pyramid scheme.
The big "secret" about understanding network marketing is that hardly anybody actually does it.
Stop insulting me. It's getting tiring.
How many of Amway's 500+ products have you tried?
Why do you think this is?
icerat
Philosopher
Two reasons -
(1) As Jeff Olsen puts it in The Slight Edge - it's really easy not to do.
(2) Lack of belief - they don't believe prioritising it will necessarily get the results advertised.
I find these same things in my business. Perhaps they are common?
icerat
Philosopher
Of course, up to 70% (some studies are higher) of people don't even bother to take medicine that can save their lives
Heck, I'm currently sitting here chatting on JREF instead of renovating our guest house or working on any of my 4 current business projects!
Couple of interesting things to note. A founder's business is one that qualifies 12 out of 12 months in Amway's fiscal year and it is the exception and not the rule. Most diamond businesses are not founders.
Secondly, the crown ambassador or any pin (such as diamond) is a once in a lifetime achievement. Thus if Dornan was a crown ambassador and later did not qualify, he is recognized as a crown ambassador for life. There are some, possible many people selling tools as a diamond or higher, who might not be currently qualified.
Third, the tools and seminars are likely to generate more income for these big pins because the profit margin is much higher. If I sell a box of soap for $10, I make a profit of a dollar or two. Compare that to selling a cd that costs 50 cents to a dollar to produce, and I sell it for $7 or $8. Or a function where it costs $25 a head and I sell tickets for $125 per person. That's where the real money is.
xjx388
Penultimate Amazing
- Joined
- Dec 1, 2010
- Messages
- 11,392
Still haven't seen any evidence that, for most people roped into joining Amway, there is a great chance of building a business to even one tenth of what Dornan managed to build. As Amway itself admits. All the top people in Amway amount to less than 1% of IBOs.
icerat
Philosopher
If you're trying to build a business based on chance, I suggest you start a casino.