Mycroft
High Priest of Ed
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Moderated MLM Crap :(
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icerat
Philosopher
Entirely agree. Since it's not the reality, at least not for Amway, you can stop worrying about it.
You did no such thing. You may as well claim you make money by getting born, since if you get born you can get a job or start a business or something
So...on a skeptics board, the same kind of woo comes up again and again?
Tell me about it. It's unfortunate how many otherwise skeptical, rational people completely and emotionally fall for unsupported myth and assertion on this topic and fail to do even a modicum of research of any kind of decent standard.
I think I originally got dragged on the topic on JREF (I was already a member) after one of the Skeptioid podcasts by Brian Dunning, where he made absolutely nonsensical claims, like direct selling is OK when done as Avon does it, but MLMs are scams.
Avon is of course an MLM company.I think he also repeated myths like Taylors imaginary "70% retail sales rule".
MLM is a classic example where smart people delve in to an area in which they actually know very little, but think they know a lot and then jump to conclusions which they defend with the full force of logic combined with ignorance and confirmation bias.
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Mycroft
High Priest of Ed
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Because they're optional. But necessary.
C’mon, this is plain denial. Tools and materials are a huge part of the profitability of Amway, just not at the distributor level.
You showed us a link about a page back (and ignored my commentary on it) where a woman who burned out on Amway after 4 years hard work and thousands of dollars invested was blamed for her own failure because she didn't do the necessary work of putting the Amway business model in front of 15 new prospects a month.
So…why would she need to show the business model to 15 new people if not to recruit them? Why would she need to recruit people if recruiting people were not the key to success in Amway? Are you going to deny that recruiting people is an important part of success? Or are you going to quibble over the definition of “success”?
icerat
Philosopher
Because they're optional. But necessary.
C’mon, this is plain denial. Tools and materials are a huge part of the profitability of Amway, just not at the distributor level.
1. Amway makes no money out of tools
2. The vast majority of profit comes from sale of Amway products, not tools.
Simple math to prove it.
Sales last year were $9.2billion. We'll ignore additional retail markup profit.
Amway pays out approximately 35% of revenues in bonuses and commissions to the field - ie $3.22 billion in profit to the field, before any retail markup profit.
Are you seriously claiming Amway business support companies collectively profit over $3 billion dollars a year? Revenues must be in excess of $10 billion, especially if Joecool's and Newton Trino's claims of extreme profit margins are true. There's only maybe 3 or 4 that are of any kind of significant size, so at least a couple of them must have revenues of several billion dollars a year.
Why aren't these multi-billion dollar companies on Forbes Largest Private Companies list? Some of them have been running for decades, shouldn't their owners be on the billionaires list?
C'mon, be serious. Have a little skepticism of the claims of the anti-amway zealots.
Oh right, after 4 years of hard work she was "blamed" for her own failure because .... well .... because she didn't do 4 years of hard work. She didn't even do a month of medium work.
Do you make this stuff up without thinking about it, or do you deliberately right such rubbish? (PS I didn't ignore the earlier post, I didn't see it. Not going back to look for it either, assuming it was full of the same mischarecterizations)
Did you dishonestly misquote the article, or just have a poor memory? Here's what it says, I've bolded the part you've selectively removed from your frontal lob -
if you want to build a profitable Amway business in a reasonable amount of time you need to expose the business plan and/or products to, ideally, at least 15 people/month.
Furthermore, showing the business model incorporates showing the products. It is a strategy to obtain retail customers as well as business partners. Indeed, out of 15 "plan showings" you should be aiming for 3 or 4 sponsored people, of which only 1 your expect to be a business builder, even for a short time. Only 1 in 5 of them do you expect to be long term business partners, instead, if handled properly, reverting to customers. The others are merely discount customers right from the start, and you'll also pick up another 3 or 4 as full retail price customers.
You get that? Showing the business plan alone should result in up to 5 times as many customers as "business building recruits".
The Network 21 system for developing a platinum level business is based around finding 3 serious business building recruits, 3 hobbyists who might get serious one day, 14 "member" shoppers, and 20 regular customers a month, which means at least 50 customers on your books. Got that? A customer:serious business builder ratio (the ones buying tools) of almost 70:1.
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Mycroft
High Priest of Ed
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I found a website where one can listen to some of these promotional materials for free. This is from Danny and Renate Snipes, who are pretty big among the Amway motivational crowd.
http://grooveshark.com/#/album/3d+Vision/4043582
"...I'm telling you guys there is a whole life ahead of you. The dream is real, and you can live the dreams. ..."
More from Gary Newell
http://grooveshark.com/#/s/Track+1/3z0L2Q?src=5
http://grooveshark.com/#/album/3d+Vision/4043582
"...I'm telling you guys there is a whole life ahead of you. The dream is real, and you can live the dreams. ..."
More from Gary Newell
http://grooveshark.com/#/s/Track+1/3z0L2Q?src=5
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icerat
Philosopher
I had to look them up on Amway Wiki. Part of LTD, one of my least favourite organisations. Full of right wing christian fundamentalists who use the business to proselytize their beliefs.
It's not playing for me?
Note that if it's on a CD/MP3, it's probably being addressed to the people who have already joined and are part of the 1 in 5 to 1 in 10 who are considering it seriously enough to pay money for the seminar where it was recorded. It has to be interpreted in that context.
icerat
Philosopher
Links are really useful things. Try clicking on them
It's not being used to entice people to join
Mycroft
High Priest of Ed
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I did, but I still don't get your point. Are those the "bad" Amway people but all the rest are good? If so, what makes them different?
Nor did anyone claim they did. What a bizarre thing to say.
But these are motivational materials marketed to the Amway down-line and also used to promote seminars, correct?
icerat
Philosopher
How would you possibly get that interpretation? I'm sure right wing evangelicals think they're fabulous. I'm a center-left atheist. Start babbling about god or the evils of lying global warming scientists at a seminar that's supposed to be about Amway, I'm out the door (and yes I have heard that kind of stuff from some Amway groups
There's been numerous comments about peope being promised wealth beyond there wildest dreams blah blah blah in order to get them to join. If that's not what you were referring to, my apologies.
What were you referring to?
Marketed to those who are affliated with LTD, which is Leadership Team Development, one of many independent companies that produces these materials and services for IBOs.
No idea how old this recording is, but these days these companies have to get accredited by Amway and agree to certain rules (like no religious and political stuff, and independently assessed approval of whatever compensation plan they may use to compensate those who promote their products)
Some of the materials would be used to promote seminars, yes. I've finally got to start listening to this one. So far just seems to be on the importance of personal development and growth in order to achieve ones goals.
Therein lies the entire problem with MLM and Amway. Because of middleman bonuses, a $2.45 product must sell for as Icerat says, for about $7.00 when the IBO bonuses are built into the cost. In Walmart, they would get the $2.45 product, add their approximate 20% markup and sell the product for about $2.93. You end up paying more than double in Amway.
Add in those "optional" but "vital" and "necessary" tools that teach you that this is a good idea, and you have what appears at best to be a huge conflict of interest, and at worst, an insidious scam.
http://www.webraw.com/quixtar/archives/2008/01/couldnt_do_any_worse.php
Over on the Ada-tudes blog there was an article by Todd Krause which seemed to address some comments made on an earlier article he wrote about Quixtar sales. Anyway I found it a bit funny that he was addressing those who made statements to the effect that the corporation does not have the credibility to tell IBOs how to sell or build Quixtar/Amway businesses. Todd Krause agreed with the statements saying it was not their intention to go around IBO leaders.
Well in my opinion the corporation is doing more to teach IBOs how to sell a product then IBO leaders are. IBO leaders are concentrating on teaching IBOs how to sell a "system". One look at the numbers that only 3.4% of all Quixtar sales were sold to actual customers tells you how good the IBO leaders have been at teaching selling techniques. So I don't think the IBOs should concern themselves so much with where the teaching is coming from, 3.4% isn't exactly a high bar that has been set.
NewtonTrino
Illuminator
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So...on a skeptics board, the same kind of woo comes up again and again?
But it's the exact same people arguing the exact same points.
The funny thing is that this goes back several years now and icerat isn't making any more money today than he was back then. You'd think that if this was such a great business that he'd have built it up to something profitable by now.
Also, I hate to repeat myself but until we see a good sampling of diamond level income tax returns icerat has no way at all of proving they don't make the majority of their money from "tools".
icerat
Philosopher
non sequitur.
I think going to the gym and losing 20 pounds would be a great thing to do too. You'd think that if it was then I'd have done it by now.
Well it is, still haven't done it. non sequitor.
[uote]Also, I hate to repeat myself but until we see a good sampling of diamond level income tax returns icerat has no way at all of proving they don't make the majority of their money from "tools".[/QUOTE]
Well, there are others ways, but yes, that would be the simplest (though even then might require interpretation)
But guess what - you've no way to prove they do either.
This is going to be a problem if we are trying to answer the question, "Is MLM a good business model?" and we can't agree on what "good" means in this context.
We might as well call that group of people "customers."
I would like to use profit and money as the relevant metric. Whatever else Amway may provide, that is not "business." I claim this in the same way I might say that a church isn't a business model, even though, in a sense, they provide a service and receive compensation for it. The main purpose of a church (Scientology aside) isn't to make money, it's to promote a religious viewpoint in service of a deity and holy writ.
Now, if the main purpose of MLM isn't to make money for the participants, then it is something other than a business. It may be a hobby or a charity or a buyer's club... but what defines a business is the profit motive.
Is this fair or would you like to use another idea of what a business is?
NewtonTrino
Illuminator
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Maybe you aren't listening to enough of the brainwashing materials to motivate you.
The burden of proof is on the claimant. If you want to show me how diamonds really make their money by getting a representative sample of tax returns and analyzing them then we might actually have sometimes to discuss. Until then I'll go with the data I've seen with my own eyes, which shows that amway kingpins make their money through selling motivational brainwashing garbage.
Mycroft
High Priest of Ed
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Non sequitur. I'm not fond of evangelical Christians either, but the issue here isn't their religion. I only skimmed through the recordings myself, so if they talked about God or global warming, I missed it.
But even so, it's hardly a defense to these people being shady to point out they're unpleasant in other ways too. What kind of logic is that?
From the recordings they appear to be talking to a crowd attending a seminar. These materials are sold as "tools" to people who have already signed up. They're certainly getting the crowd worked up over the dream of huge income...are you suggesting that's not okay before they sign up but suddenly becomes acceptable after they do? What kind of logic is that?
Mycroft
High Priest of Ed
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Did you get a close look at that 63 million in assets?
The bulk of it, 36 million, is his 1/3 stake in Sharshela, Inc, which is the company that makes XS Blast energy drinks, which apparently are hugely popular among Amway people but unheard of elsewhere.
So at least in the case of this one diamond, he probably doesn't make the bulk of his income selling motivational materials. He makes the bulk of his income selling energy drink to Amway, which re-sells it to it's captive market.
Other notable assets, Krone, Inc, which is his Amway distributorship. Diamont Motivational, a video/audio production company...guess what that produces? And Dayspring lodge and Farms, which appear to be just private residences organized as business for some purpose.