Amway TV ad

[icerat]

Year after year, the Bible is a best-seller.

That statistic, however, says nothing about its legitimacy.

No, but it says plenty about legitimate demand, which is one of the discussion points here.

 

[icerat]

Not sure, but the investment for people who attempt to build their business exceeds $50. Amway will not be refunding their invested labourtime at the prevailing minimum wage rate.

That's why it's a relatively big risk - as big a risk as any entrepreneural franchise, and in my opinion, possibly more (catchments are not controlled).

Blutoski, out of interest, how many businesses have you started? Having started quite a few, I can assure you the "risk" with Amway is trivial compared to other businesses, both in time and money.

 

[Furcifer]

Blutoski, out of interest, how many businesses have you started? Having started quite a few, I can assure you the "risk" with Amway is trivial compared to other businesses, both in time and money.

Is this the company motto?

 

[corplinx]

Having started quite a few

To properly assess your expertise as an independent businessman, would you care to tell us how the ventures fared?

 

[icerat]

some good, some not so good. c'est la vie

Amazing how these discussions always seem to come down to me. Can't dispute the facts, can't dispute the logic, so I guess that's all that's left huh? Oh ... well you could just ignore the facts and make stuff up ... that seems to be a popular approach too ...

 

[corplinx]

some good, some not so good. c'est la vie

Amazing how these discussions always seem to come down to me. Can't dispute the facts, can't dispute the logic, so I guess that's all that's left huh? Oh ... well you could just ignore the facts and make stuff up ... that seems to be a popular approach too ...

I like to ask questions and collect evidence. I am a curious cat.

For instance, earlier when I saw the 7.1 billion revenue number for 2007, I tried finding revenue numbers for Clinique and Lauder and market share numbers. I wanted to compare a diversified company like Amway to a pure cosmetics entity. Unfortunately, such data isn't readily available

If you were a small businessman who had successful ventures and left them for Amway, you would have to admit that it would speak as a good testimonial for Amway.

No need to be overly defensive. If Amway was a fallback because such ventures did not work out, that is not a bad thing. Most Small Businesses Fail.

 

[icerat]

I like to ask questions and collect evidence. I am a curious cat.

For instance, earlier when I saw the 7.1 billion revenue number for 2007, I tried finding revenue numbers for Clinique and Lauder and market share numbers. I wanted to compare a diversified company like Amway to a pure cosmetics entity. Unfortunately, such data isn't readily available

Amway 2008 sales were $8.2billion, I believe Artistry was between close to 2 billion of it. You can buy the reports that collate this stuff from Euromonitor, alas they cost the GDP of a small country

If you were a small businessman who had successful ventures and left them for Amway, you would have to dmit that it would speak as a good testimonial for Amway.

Amway isn't something you have to "leave" something else to do. Though to be honest I think it's easier to do Amway if you have a job than another business.

No need to be overly defensive. If Amway was a fallback because such ventures did not work out, that is not a bad thing. Most Small Businesses Fail.

Not being defensive, it's just not really relevant. None of my businesses have failed. The biggest came awful darn close due to a crooked partner, but I managed to recover it and sell it profitably. Alas the new buyers ignored my advice and weren't so fortunate. And they paid a lot more than $50 for the opportunity to fail

 

[NewtonTrino]

So Icerat a diamond with 5000 distributors (avg) makes at LEAST $10k per month in profit from tools according to your numbers?

HOW IS THAT NOT A SCAM? $150k from Amyway and $120k from tools? Conflict of interest anyone?

Your numbers are EXTREMELY conservative btw.

Let me ask a few more questions AGAIN:
In the group you are associated with what the RECOMMENDED montly spending on all tools, functions and other BSM's?

What is a breakdown of where ALL of the money goes? How much does a CD cost and where does all of the money go?

In your BEST year as an Amway distributor how much money did you declare as profit on yuor income tax?

I think it's clear given how conservative the numbers are that it's easy to make way more money in tools than it is to make money on the business.

As a matter of fact http://dougwead.wordpress.com/ which is the blog you referenced makes it clear that the tools system was and is very profitable. Doug has his own particular spin on this and is trying to promote his new venture but you can easily read between the lines.

As a side note I saw Doug speak many times live when he was actively in the business and doing the circuit back in the day (early 80's). If you read his page he has a who's who list of network marketers including some commentary on each. Well worth reading as he talked a lot about how they were innovative in terms of system development (where the profit is).

Anyway Icerat, if you TRULY believe that the tools aren't extremely profitable I have no idea what to tell you. You obviously are a true believer although I have seen others claim that you are simply a paid shill.

 

[icerat]

So Icerat a diamond with 5000 distributors (avg) makes at LEAST $10k per month in profit from tools according to your numbers?

PLEASE read what I wrote. That was an overgenerous *maximum*

Your numbers are EXTREMELY conservative btw.

No they're not. The numbers of distributors and platinums in a Diamond group come from official Quixtar statistics revealed in a court case. They're not coservative, they're *factual*.

The rebate $$$ are the actual current rebate figures for one of the world's largest systems.

The numbers of CEP comes from official statistics from that same organisation - and as I said I was generous with that.

In the group you are associated with what the RECOMMENDED montly spending on all tools, functions and other BSM's?

You still haven't answered my questions - why should I bother going to the effort to find data to answer yours?

What is a breakdown of where ALL of the money goes? How much does a CD cost and where does all of the money go?

Same type of expenses as any other business I expect

In your BEST year as an Amway distributor how much money did you declare as profit on yuor income tax?

As little as was legally possible.

I think it's clear given how conservative the numbers are that it's easy to make way more money in tools than it is to make money on the business.

And so it goes. I gave actual, factual statistics, you arbitrarily declare them "conservative".

As a matter of fact http://dougwead.wordpress.com/ which is the blog you referenced makes it clear that the tools system was and is very profitable. Doug has his own particular spin on this and is trying to promote his new venture but you can easily read between the lines.

Yes, for profitable for some. Primarily people who were smart enough to setup the companies and supply tools and services to Amway IBOs outside of their own groups, or so far in depth the Amway income was effectively zero, and people like Doug who were in heavy demand as speakers - again from groups outside their own. The majority of Diamonds do and did not however make huge tool incomes.

Indeed, I managed to get the average "system income" for all Diamonds in one system - it was less than $25,000/yr. (I have friends too) Now some of them are probably no longer qualifying as Diamonds (the systems don't actually know who is, though generally have an idea), but I've established from Amway publications they're virtually all Emerald and above.

One quote from my source -

Of course some make 30% [of total Amway+ system income] or perhaps more but very few ... Certainly not 500% as we have been hearing.

Anyway Icerat, if you TRULY believe that the tools aren't extremely profitable I have no idea what to tell you. You obviously are a true believer although I have seen others claim that you are simply a paid shill.

If I setup a business selling tools to Amway IBOs, and I have way way more Amway IBOs as my "tool" customers than I do as my "amway" customers, I'd expect to be making more - and I think anyone else who does it should be expected to as well. Why shouldn't they?

This is one of the things Britt and Yager did. They sold tools to way way way more IBOs than they have in the income earning part of his Amway business. Heck, Yager was selling tools to his Amway *upline*.

Now, this isn't to say the setup wasn't abused. It was. There were backroom deals and cash under the table, and people getting cut out and all sorts of stuff.

Don't you think it's at all interesting though that when Amway founder Rich DeVos spoke about problems with "system income", he was referencing one particular system and it's affiliates?

Don't you think it's interesting that when Ed Postma wrote his infamous memo, he explictly mentioned just one particular system and it's affiliates?

Don't you think it's interesting that every single former "higher pin" who has done a tool income expose on the 'net belonged to just one particular system and it's affiliates?

Don't you think it's interesting that every single book/ebook doing an expose on Amway and tool income were written by folk involved in just one particular system and it's affiliates?

Don't you think it's interesting that *every* distributor lawsuit involving tool income disputes involves just one particular system and it's affiliates?

Seeing any pattern here?

Here's a hint: It was the same system and it's affiliates in every case.

So, I ask again, who was your experience with, and when was it? Not that I can't guess ....

Ohh .... and was it before or after Amway brought in independent outside asessors to investigate the BSM company systems to see if they were fair and reasonable? Was it before or after Amway brought in requirements for things like contractual agreements on tool rebates?

 

[NewtonTrino]

So, I ask again, who was your experience with, and when was it? Not that I can't guess ..

I see, so your organization WHICH YOU REFUSE TO POST ANY NUMBERS FOR YOU doesn't make a ton of money from tools?

You are deluded.

Not only are you deluded but you are also a hypocrite for telling people how great this business is when you a) haven't reached a level high enough to know all of the details and b) aren't even currently building it.

Again if you have 5000 distributor and you can figure out how to suck $50 a month in profit out of them in tools you are making $250,000 PER MONTH. Compared to $150,000 PER YEAR in Amway income.

My people tell me the average diamond makes 80% of their income from tools. So if it's $150k in Amway income it's more like $500k per year in tools profit. These numbers make complete sense given the 30% tools participation rate and the splitting of the tool profits amongst the downline (the higher you are in the pyramid the more you make per tool unit which is the inverse of normal product btw).

Anyway I completely dismiss your idea that it's only Dexter/Britt that make money from tools. They all do, it's what the business is.

 

[NewtonTrino]

Here is a quote from Doug Wead's blog. Basically what he has done throughout his explanation of his time in Amway is basically say a) yes there is money in tools and b) so what. In other he's not denying it, he just doesn't think it's a big deal. I think Icerat is pretty much in the same boat.

from http://dougwead.wordpress.com/2009/05/17/amway-diamonds-and-their-tools/

I recently sat with one of the most famous diamonds and he was rationalizing his life of selling tapes by saying that what he tells the people is that “these tapes are good for you, they will build your life,” which is true. He just doesn’t talk about how they relate to the business because while they will indeed build the business, the business may not offer as much money as the tapes. He knew that the tapes had bought his mansion, not his networking business. So I think his conscience was bothered by that.

 

[NewtonTrino]

I also think the blog of the guy arguing with Doug is interesting.

Here he lays out some more info on the tools scam:
http://texsquixtarblog.blogspot.com/2008/03/9-steps-of-truth.html

 

[NewtonTrino]

This is an interesting tax case. The gist of it is that this couple was offsetting taxes on income from their jobs because of the (large) losses of their Amway business.

It shows just how much time and money people spend chasing functions and showing the plan.

http://law.onecle.com/tax/2000/nissley.tcm.wpd01.html

Petitioners estimate that they devoted between 51 and 80 hours per week to their Amway activity, with Mrs. Nissley spending 21 to 40 hours per week and Mr. Nissley spending 30 to 40 hours per week.

9 years of losses averaging $25k per year (some of that isn't real expense because it's home office write off). All this while working 50 to 80 hours per week building Amway between then.

Note that when questioned you will find that most people in Amway put in an inordinate amount of hours. It's not even close to part time and many people start having time management issues, lose their non-Amway friends, have lower performance at their regular job etc.

It's not a pretty sight frankly. It's not wonder that Icerat isn't actively building it right now. It's a lot of work for little to no reward until you get big enough to start making tool profit.

 

[Skeptic]

This is contradictory. If most people fail then it is a high risk way of trying to be your own boss..

The Amway 'answer' to this is that it isn't high risk to those who really want to succeed. "100% of those who really want to" is an answer often given to those who ask about the success rate in Amway.

They need to look up what the word "risk" means, but, apart from that, I guess that (1) 99.5% of those in amway don't really want to succeed, and that (2) If I really want to be president of the USA, then I will be. If I fail, it's just because I didn't want it enough!

 

[Skeptic]

Oh, and every other product business, which are all "pyramid structure", needs to do something quick - business expert Skeptic says they need to be more traditional!

Geez, is there any tired nonsense from your upline you won't repeat?

In a real coporation, the CEO earns more than the janitor. But (a) both get paid, and (b) the money comes from outside the corporation -- from customers not working for the corporation itself.

In amway, (a) the janitor (the lower-level guys) actually pay the CEO for the "priviledge" of "joining the great opportunity" and for being "educated", and (b) no money comes into the system from outside -- the only people who buy products are amway reps themselves.

In a real corporation, in other words, products are used to get money from outside customers to everybody in the corporation (that's the point of a coroporation). The janitor might make less money than the CEO, but at least he gets paid.

In amway, the overpriced crap they sell is merely a tool to shuffle money from the janitors (the lower-level folks) to the CEO (The higher-ups). Here, It's designed to have 99% fail -- becuase it is precisely the money those who spend more than they earn in amway that is shuffled to the top 1%.

Where does that money come from? Simple! From the janitors' -- the lowel-level guys' -- real job, business, or investments (you know, a job -- that "just over broke" losers' hell that all those losers not "owning their own business" in amway must do to scrape together enough to pay for bread and water?).

They work in a regular job, make money, "invest" it in amway, and get it scammed from them by their "uplines". That, and not the mere fact that there are less big earners than small earners

 

[NobbyNobbs]

No, but it says plenty about legitimate demand, which is one of the discussion points here.

If millions of people demand a foolish thing, it doesn't make the thing any less foolish.

There is a legitimate demand for psychics, reiki, chiropracters, and homeopathy. None of these things are illegal, and millions of people demand them.

The demand is legitimate. What they are demanding is not.

 

[NewtonTrino]

Keep in mind that the tools are not just a profit center. They are also central to the control of the organization. The meme's that spread through the audio recordings are ones that have been proven helpful to make the (tools) business profitable. Unfortunately it does that by using a lot of cult and mind control techniques. Love bombing, separation from family and friends (unless they get in) etc. Basically the are the secret sauce that turns recruits into true believers. It's fascinating to read accounts of people after they've woken up from this, something many years after living in the Amway bubble with little outside influence.

 

[icerat]

I see, so your organization WHICH YOU REFUSE TO POST ANY NUMBERS FOR YOU doesn't make a ton of money from tools?

And I see you still don't read my posts.

Not only are you deluded but you are also a hypocrite for telling people how great this business is when you a) haven't reached a level high enough to know all of the details and b) aren't even currently building it.

Oh, my apologies, you did read my post - but I didn't realise YOU had (a) reached a level high enough to know and (b) are currently building it

Post YOUR numbers

Again if you have 5000 distributor and you can figure out how to suck $50 a month in profit out of them in tools you are making $250,000 PER MONTH. Compared to $150,000 PER YEAR in Amway income.

Yes, if you had 5000 distributors and figured out how to get them all to buy $50/mth worth of Amway products you'd be making even more. But heck, if we're posting hypotheticals .. did you know if you have 5000 distributors and you figured out how to suck $5000 a month in profit out of them in tools you are making $250,000,000 PER MONTH!!!

My people tell me the average diamond makes 80% of their income from tools. So if it's $150k in Amway income it's more like $500k per year in tools profit.

ROFL - "your people". hahahha. "My people", tell me something different. Don't you wonder how I have all the rebate schedules? And actual hard numbers.

These numbers make complete sense given the 30% tools participation rate and the splitting of the tool profits amongst the downline (the higher you are in the pyramid the more you make per tool unit which is the inverse of normal product btw).

Might have been true in the group you had experience with, isn't with other groups.

Anyway I completely dismiss your idea that it's only Dexter/Britt that make money from tools. They all do, it's what the business is.

Please, take some remedial reading classes. I never made any such claim.

WHY DO YOU CONTINE TO REFUSE TO ANSWER WHICH GROUP(S) YOUR "PEOPLE" HAVE EXPERIENCE WITH?

 

[icerat]

If millions of people demand a foolish thing, it doesn't make the thing any less foolish.

There is a legitimate demand for psychics, reiki, chiropracters, and homeopathy. None of these things are illegal, and millions of people demand them.

The demand is legitimate. What they are demanding is not.

Whether a product is legitimate or not is a different question. The allegation here from Skeptic is there is no legitimate demand.

 

[icerat]

Geez, is there any tired nonsense from your upline you won't repeat?

Hahahah - is there any tired nonsense YOU won't repeat? What is it, you can't respond logically so you have to accuse me of being some brainwashed acolyte?

I wasn't even referring to corporations - I was talking about product distribution.

In a real coporation, the CEO earns more than the janitor. But (a) both get paid, and (b) the money comes from outside the corporation -- from customers not working for the corporation itself.

(b) applies to Amway as well. You'd have people believe that if someone becomes a member of Sam's Club or CostCo that means they're "working for the corporation".

I'm sure they'd be shocked to hear that.

In amway, (a) the janitor (the lower-level guys) actually pay the CEO for the "priviledge" of "joining the great opportunity" and for being "educated", and (b) no money comes into the system from outside -- the only people who buy products are amway reps themselves.

Same old BS mantra. People who join Sam's Club to buy stuff cheaper are Sam's Club employees! Have you told the IRS? I'm sure there's some interesting tax implications if your claim is correct ...