Amway TV ad

[icerat]

I think if you look a little closer you'll find that the studies are written by the corporations.

Hmm ... I did just look closer ... and the Times 100 FAQ says -

1.it is produced by and with teachers to ensure it is focused on the Business Studies curriculum

Where did you look that says it was produced by the corporations?

 

[cyborg]

HAHAHAHHAHAHAHAHA

Is that your usual "trick"? Pick half a dozen statistics "in favour" of an argument, and hope nobody notices that your sample selection isn't relevant to the question being asked, and instead is conveniently heavily weighted in the direction of giving the answer you want to prove .... then go "see, what a nice guy I am ... I'm picking data in your favour!"

Good one. Ha ha.

So the averages per day are too low you're saying or what?

I.e. it's more than $7 a day?

 

[Foolmewunz]

Hmm ... I did just look closer ... and the Times 100 FAQ says -



Where did you look that says it was produced by the corporations?

"By and with".

With? With? With? With?

Who do you think those teachers work WITH? Read the other studies. It's quite clear that they're mostly put together by the corporations.

 

[blutoski]

Ok, we're getting a little confused here. There's been no discussion at all about Amway employees. We've been talking about people who are members of the Amway network, either for shopping, to market the network and make some money, or a mix of both. The closest analogies might be something like CostCo or Sam's Club mixed with affiliate marketing for those who want to make the effort. In some countries there's a yearly membership fee (typically no more than $40 or so), in some countries it's free, in some places it's a combination depending on various criteria.

My impression is that everybody who "joins the network" has the right to represent the company and sell company product, correct? How are these not employees?

 

[blutoski]

PS I'd note that your employee may not make you pay for it with $$$, but I'm pretty certain you have to turn up to work to qualify for it! There's no such requirement with Amway.

This depends on the employee. Some are pieceworkers.

 

[icerat]

My impression is that everybody who "joins the network" has the right to represent the company and sell company product, correct? How are these not employees?

Well, in some countries you can be a member without the right to sell the products. What you get is the right to market the products. You don't represent the company either, not in the sense it's normally used in business. Of course in the public eye you do. If you sign up for Amazon.com's affiliate program, you can market everything they sell, but you're not an employee of Amazon.com nor do you represent amazon.com.

This is actuallly where a lot of the confusion comes from, people go for example to a seminar full of Amway independent contractors, and they think they're at an Amway seminar, when chances are it's actually run by another company altogether, who may not necessarily do things the way Amway (or other reps for that matter) particularly like.

It's also important to note that while you get the right to market and sell the products, very few people who sign up actually use those rights.

 

[icerat]

So the averages per day are too low you're saying or what?

Average is not a statistic you can use with a non-normal distribution. It's meaningless, and can only mislead.

 

[cyborg]

Average is not a statistic you can use with a non-normal distribution. It's meaningless, and can only mislead.

Then how about a graph of the distribution? That would do just as well and we could all see for ourselves how many are making how much.

 

[Skeptic]

My impression is that everybody who "joins the network" has the right to represent the company and sell company product, correct? How are these not employees?

They don't get paid. Apart from that...

 

[Skeptic]

Average is not a statistic you can use with a non-normal distribution. It's meaningless, and can only mislead.

From this web page, a table of the income distribution in the "old" Amway (Sorry about the lousy formatting):

Percentile Gross Monthly Income Net Income (Loss) Category
----------------------------------------------------------------------------
99.996 $10,183.00 $9,683.00 Diamond
99.9 $6,321.75 $5,821.75 Emerald
99.5 $2,034.00 $1,534.00 Direct
95.3 $108.00 ($392.00) >500PV
89.1 $70.50 ($429.50) >125PV
79.8 $45.00 ($455.00) >75PV
66.4 $15.00 ($23.00) >25PV
59.7 $0.30 ($38.00) >1PV
46.0 $0.00 ($38.00) 0PV active
under 46 $0.00 $0.00 inactive

The details and names might have changed in the "new" Amway (now Quixtar) but the principle and general distribution has not. You need to be in the top 1/200th of the distributors to make as much as a part-time minimum-wage job would make you, and in the top 4% or so to make any money at all.

What a great opportunity!

 

[icerat]

Ahhh, Skeptic, I'm starting to realise you're just a joker! Now you're quoting decade old "analyses" from someone else who is just making up figures! He misses half the bonuses and income sources that existed THEN, let alone now. Heck look how often he uses word like "assume" and "about"

Given up making up your own figures, so now you use others made up figures! Hahahahahahahah

 

[Skeptic]

Ahhh, Skeptic, I'm starting to realise you're just a joker! Now you're quoting decade old "analyses" from someone else who is just making up figures!

Sure he is. Everybody's a liar about poor, innocent amway... except for that top 0.5% in the system who are making the big bucks. THEY are telling us the TRUTH about what a great opportunity it is, how great the products are, etc.

 

[Furcifer]

The premise that Amway is some fraudulent scam business requires the belief that The Times, Forbes, Deloitte, UN, UNICEF, US Chamber, various Presidents of the US and other countries, numerous courts, governments around the world of all political hues, independent product review companies like Consumerlabs and Consumer Reports, thousands of "partner companies", numerous authorss, top athletes and celebrities who endorse and/or use the products, including teams like AC Milan, and on and on and on ....

.... all of them have somehow been hoodwinked for 50 years into believing Amway is something other than this huge fraud.

Oh boy, another strawman. Could you please indicate who said that Amway was fraudulent? A scam maybe, but fraudulent? I don't recall anyone in the entire thread saying this. If I remember correctly it was pointed out again and again and again that this is LEGAL. But here you are going on about some premise that no one has exhibited.

No I see why Bob said to be careful what we say about Amway around you, certain trigger words seem to kick in the Amway conditioning reflexes:

"What do we say when someone mentions the "P" word?"

"Amway is not an illegal pyramid scheme, the FTC says so, Amway is a charter member of the Chamber of Commerce, biggest online retail sales in Cambodia 3 years running"

There's nothing illegal with Amway, you just have to accept the fact that it is a losing proposition for a majority (very major) of people that enroll in the program. But don't let statistics get in the way of your dreams!

 

[Almo]

...whether folk people like Skeptic's...

Hahah!

 

[icerat]

Then how about a graph of the distribution? That would do just as well and we could all see for ourselves how many are making how much.

Unfortunately the corp doesn't release enough info to do such a graph accurately. Even if we did get a distribution of the bonuses the payout it doesn't include most customer sales (and markup profit), doesn't include expenses, and most importantly has no measurement at all of the time and effort put in.

I honestly do wish it was a simple thing to respond to, but it's kind of like asking for the average income from law of everyone who thinks about studying law.

There are however some established statistics either published by the corp or revealed in a legal battle with some distributors a couple of years ago who got kicked out.

If you're interested in the "odds" of success, you might want to read this post

If you're interested in what kind of incomes are possible, this site has some figures, though it's a little out-dated in two ways. One they're FTC mandated stats coming out of 1974, when the business was a lot different, and thus not always sensible, and two there a few years old and Amway has since increased many of the bonuses.

In short, most people who join Amway make no money at all, but that's as expected since most people do nothing at all. That's their choice. Then you have a bunch of folk who just buy products, and occasionally get rebates. They're included in those statistics too. Indeed, just asking one person, once, if they want to buy an energy drink (or anything else) is enough to get you classified as "active". So is buying enough stuff to get yourself a rebate.

Unfortunately critics ignore this and jump on the "average income" statistic as if it means something. Nobody without an agenda would seriously consider that someone who buys a few products and gets a discount should be earning a big income. Nobody without an agenda would seriously think that just asking someobody, once, if they want to buy something (and they say no!) is enough to earn any kind of income. Nobody without an agenda would think just attending a training session, or even an info meeting, once in a whole year, is enough to be making money.

Nobody except Amway critics, who constantly harp on the fact that all these people don't make any money!

Well, duh!

The reality is that like any other business, it takes months and years of hard work to build an Amway business. It has an extremely low cost of entry, so people are able to dip their toe in the water, give it a try and see if it's something they want to do. Most people decide they don't. That shouldn't be seen as them or the business model "failing" - it's designed that way! Make it cheap and easy for people to start a business and see if it's something for them.

Heres' the reality.
50% of people who join don't do anything - not even place an order. Their choice.
Only around 15% of people who join attend training sessions. Their choice.
Less than 10% of people who join do the recommended work for even one month. Their choice.
Only around 1 in 600 of people who join do the recommended work for the consistent 12-24 months minimum it's suggested is needed to build a decent size business. Their choice.

It's no coincidence that the number of people who develop "platinum" businesses, average income around $50,000/yr, part-time, is also around 1 in 600.

Now, all of that might still be problem if Amway was making all it's money getting people to join who then do nothing, but they don't. Less than 10% of revenues comes for sample products that folk are encouraged to buy to try at joinup, and even then they can get all their money back if they want.

It's a low-risk way of trying to be your own boss. As a UK judge said, dismissing claims Amway was a scam - "it's an opportunity, not a guarantee".

 

[NewtonTrino]

So let's say the average diamond makes $150k per year from products and has an organisation of 5000 distributors.

If they could can make a profit of $50 per month from each distributor by getting them to buy books, tapes and function tickets this is an additional $250,000 PER MONTH!!!

This is the scam in a nutshell. The corp. makes it's money from the overpriced crap products and the distributors get a "legal pyramid" that they can use to profit from by selling their own products (brainwashing materials mostly) into the pyramid.

Look at the numbers above. Seriously look at them. The corp makes billions from the products, the kingpins make much dollar from the tools and the low level distributors listening to the brainwashing garbage (hi icerat!) are left holding the bag.

Icerat, don't even bother trying to say your organisation isn't one of the bad ones. It is and you CANNOT account for the all the tool money when challenged to do so.

 

[Furcifer]

In short, most people who join Amway make no money at all, but that's as expected since most people do nothing at all.

It's a low-risk way of trying to be your own boss. As a UK judge said, dismissing claims Amway was a scam - "it's an opportunity, not a guarantee".

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

The reason it is high risk is due to the "pyramid". If Amway were to forego this business structure and move towards a more traditional means of marketing and selling their products they might do better (as a company). The problem is they are entrenched in this "style". I doubt if the "uplines" would go for it. Until then it remains a slightly "shady" prospect. There's certainly nothing illegal about it and it has been around for 50 years.

Still, if they managed to get rid of this model and become competative with traditional retailers, there is something nostalgic and appealing about a door to door salesman that delivers quality products at a reasonable price.

 

[icerat]

So let's say the average diamond makes $150k per year from products and has an organisation of 5000 distributors.

If they could can make a profit of $50 per month from each distributor by getting them to buy books, tapes and function tickets this is an additional $250,000 PER MONTH!!!

Oh good grief, you and skeptic are peas in a pod - did you bother to read the previous post? Less than 20% of IBOs participate in the support systems, so already your out by a factor of 5 without even looking at whether your per month profitability calculations make any sense (which they don't).

But hey, you guys have made it clear you know what you know and damned if a little thing like facts is gonna change that!

 

[icerat]

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

If someone joins Amway to buy the products at a discount, and does so, I don't consider them a failure.

If someone joins Amway then chooses not to even give it a try, I don't consider Amway a failure.

If someone outlays there $50 to give Amway a try, gives it a try, and then decides it wasn't for them and gets their $50 back, I don't consider it "high risk".

Clearly you disagree with me on all three counts. Your prerogative.

The reason it is high risk is due to the "pyramid". If Amway were to forego this business structure and move towards a more traditional means of marketing and selling their products they might do better (as a company).

Yup ... currently #1 in nutritional supplements, #4 in prestige cosmetics, 15% growth last year. There's always room to do better, and clearly a complete change of business model is called for in the light of disastrous figures like that - heck, you'd almost think there was a recession going on!

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!

Hmmm ... if nearly all of them are "pyramid shaped", and have been for hundreds of years ... what exactly *is* traditional then?

Still, if they managed to get rid of this model and become competative with traditional retailers, there is something nostalgic and appealing about a door to door salesman that delivers quality products at a reasonable price.

Oh yes, better become "competitive", heck being #1 in their primary category and #4 in their secondary category is clearly not competitive - quick something MUST be done!

 

[blutoski]

I honestly do wish it was a simple thing to respond to, but it's kind of like asking for the average income from law of everyone who thinks about studying law.

Not quite: since the participants in Amway have to pay up front, it's closer to comparing to the average income from law of everyone who has paid tuition for lawschool, including those who do not complete their degree for whatever reason. The completion rate for the T14 in the US is 97%. Average income for those employed in the profession is approximately $80,000/yr.

Assuming the entire 3% who do not complete earn zero (generous), the raw average is $78k/yr.