For Potential Amway IBO's

The majority of the info in this post has been copied from the Potential IBO? page on our website. We have amended it some places and also added additional comments and information which reflects our current thoughts and opinions, unlike the fairly neutral original website page.

If you've been prospected to look at, or have been presented with the "business opportunity", most likely by someone that you already know, then this page is for you. You may be unclear as to what the opportunity is, how it works exactly and what is involved. You may be feeling undecided, confused or sceptical. You may be interested or really excited about the opportunity. You may even be feeling a mixture of the above. If you have been sold by "the dream" and are downright raring to go and all "fired up", then we hope this page brings you a reality check.

The first reality check is, if your business opportunity is called "IDA" or "Network 21" then you should have also been told that they are independant training and motivation organisations set up by high level AMWAY IBO's (Diamonds and above). If you have been told that "it's not Amway" or "they're just our supplier", like we were, then you have not been told the truth. Red flag number 1!

You are being presented with a "business opportunity" that like any other MLM, will require you to invest a significant amount of time, money and effort into. Do not delude yourself believing otherwise. So the decision to join should not be made lightly. It is recommended that you take the time to perform your due diligence by researching the business and the opportunity thoroughly before you undertake such a commitment. There are ample sites on the net, which covers the good, the bad and the ugly side of Amway. Empower yourself with as much knowledge as possible by considering all the cons and pros.

If your sponsor/upline has advised you not to research the business on the internet or ignore the negative stuff that's out there on the net or from loved ones, well hello to red flag number 2!

To further assist with your research, below is a suggested list of things you may want to consider and do as well as questions to ask your sponsor and their upline.

THINGS TO CONSIDER AND DO:

* Obtain samples of the products and try them yourself. Determine whether they are of value (price, performance, quality & quantity) to you and whether you will be happy to use, promote and sell the products to others. We're assuming here that you've been told about what products are available, if that's not the case and there is little or no mention about them, consider that red flag number 3.

* Take into account that alot of products must be purchased in bulk and Amway does not sell perishable goods (fresh fruit & vegetables, meat, dairy products etc) so you will need to purchase these products as you would normally do. Will purchasing through Amway really be convenient and save you time? We don't think so, but hey that's just our opinion ( see here: http://ozamwayvictims.blogspot.com/2007/12/trouble-with-buying-through-amway-part.html and http://ozamwayvictims.blogspot.com/2008_01_01_archive.html )

* Obtain a Amway Catalogue and perform your own price study/product comparisons. Note down the products that are comparible to what you'd normally buy and work out how much PV/BV and rebates/bonus you would achieve by redirecting your spending to those products (take shipping fees into account). Will you be saving any money? Until you sponsor others underneath you, then you will not make money simply by buying from yourself, you may save some money if you spend enough to qualify for a rebate check, but that's what it is, a rebate of money that has come out of your own pocket, it is not income.

* Do a detailed household budget, if you have not already done so. Consider all the costs of running an Amway business. Find out what all the expenses are involved in being IBO eg. phone, fuel, stationery, samples, seminars, books, cd's etc. Now factor in and adjust your current household budget to include the normal regular Amway business expenses that will be required regardless if profits are made or not. Can you comfortably afford to run an Amway business?

* The plan is commonly presented as working anywhere from 8 -12hrs per week, however in reality this appears to be an understated figure. The minimum amount of time required to be considered to be "working the business" is more like 15-20 hours. Do you have the time required to spend on the business each week? Showing the plan, meetings, opens, seminars etc are mostly conducted in the evenings and/or weekends. Will these interfere or require adjustments to any existing work, family, social, sporting or community commitments? Oh! and if you have been told that by working 10-12 hrs per week you'll earn $50,000 plus within 12-18 months, then consider that red flag number 4. So, ask for proof as to how many IBO's have actually accomplished that.

* Determine any taxation requirements (ABN number/GST registration) for your Amway business. Investigate if there are any taxation implications that may effect your other sources of income. Seek independant taxation/accounting advice. Familiarise yourself with the ATOs' (Australian Taxation Office) position regarding the Amway business, which is here:

http://www.ato.gov.au/corporate/content.asp?doc=/content/1770.htm&page=6. It's a lengthy document, see table of contents on the right hand side. If you've been told about any tax benefits by having an Amway business, it is against the Rules of Conduct for one (and red flag number 5), and two, if you read the ATO document, you will soon clearly see what the ATO classifies as a business.

* Are you willing to sell? Do you have sales skills or experience and if not are you willing to learn? Let's be clear on this, Selling is required in order to make any money and selling to retail customers is the best way to make money. At the very least, you will be selling "the opportunity" to others, so if you were told that "no-selling is required" (again, like we were) then quite frankly you were being lied to and up comes red flag number 6.

* How was the opportunity "sold" to you, in other words how were you prospected? Did your sponsor tell you that it was Amway or did they use "business opportunity", "new e-commerce business" or some other vague description? Did you ask "Is this Amway?" and get told "No" (red flag number 7). Will you feel comfortable in selling the opportunity to others using these, what we can consider to be very deceptive methods? Consider how you felt and the questions or concerns you had about it, it's more than likely the people you prospect will feel the same. Were your questions answered openly and honestly and consider how your concerns were addressed?

* Will you be comfortable in promoting the business to your family and friends and recruiting them as customers or IBO's? Be aware that many many people will say "no" so can you deal with a lot of rejection? Generally you will be required to make a list of at least 100 people to prospect. Are you willing to out of the blue contact old high school friends or workmates that you have not spoken to for years to pitch them the business? Are you willing to cold call and prospect strangers if you run out of prospects on your list?

* Obtain a copy of the Amway Business Compendium (Rules). Read it thoroughly and understand the rules, rights and obligations of being an IBO. Technically, we believe that it should be provided to you with your starter kit and you should not sign the IBO application until you have had ample time to do so. Contact Amway if you are unclear of anything contained therein.

* Verify any information or income projections you have been presented with. Contact Amway Head Office to verify information, confirm income claims and anything else that your unclear of.

* Some people do make money in network marketing businesses, but as stated earlier, it takes a lot of hard work and often over a long period of time. Most people however, make little or no money in MLM's. If your looking for a way in generating extra income, then we think it is prudent to investigate and compare other alternative ways (part-time/casual employment, other online businesses like Ebay or other MLM's (be careful, many of them are dodgy) that may give you better returns for your time, money and effort?


QUESTIONS TO ASK YOUR SPONSOR and THIER UPLINES:

Below are questions that we would personally ask a sponsor and their uplines in order for us to make an informed decision. We think it prudent for you do the same.

1. Can l have some samples and product catalogues so that I can do my own price study comparisons before l decide to join or not?

2. How long have you been in the business? What is your pin level? How many IBO's have you sponsored? What is the renewal rate of IBOs in your group?

3. What is the average PV/IBO in your group? What is the average profit for the IBO's in your group?

4. How many IBO's are currently in this area? How many of these are actively building the business?

5. What training is provided so l can sell the products? What forms of advertising and marketing is allowable to help me sell the products and/or attract new IBO's?

6. How many retail customers do you have and what is their average monthly spend amount?

7. Do l have to buy CD's, books and attend seminars etc to run an Amway business? If not, what other training and support will you provide?

8. What are the normal and customary monthly expenses of running an Amway business? What are the normal and customary expenses of being in your "system"?

9. Can I earn a commission on selling tapes/cd's or books? At what level can I commission and how much is it?

10. Can I earn a commission on ticket sales to meetings, conferences and seminars? At what level can l earn commission and how much?

11. How often are the meetings, conferences and seminars held? What do they entail (product training, sales techniques, motivation) Are they compulsory?

12. What is your success ratio in converting prospects to customers or IBO's? (ie. how many people need to be prospected in order for one to sign up?)

13. If l run out of people that l personally know to prospect, what are the other methods are used in attracting new customers/IBO's?

14. How many hours per week do you spend working on all aspects of your business? Attending and travelling to meetings, showing plans, phone calls, processing orders and bookwork?

15. What is your average net profit each month? Can I see your income & expense (profit and loss) records for your Amway business?

17. What are the best things about the business? What are the downsides to the business?


Performing your due diligence is not only just plain good common sense but absolutely vital when deciding whether to invest your time, money and effort into any business venture. This one ain't no exception. Forget all the "dream" stuff and treat this with a business focus (income, expenses, time) and demand proof of any income claims. If your sponsor and/or uplines do not answer your questions to your satisfaction, or get offended/refuse to do so, or divert your attention back to the dream stuff, then that should clearly tell you something!

We hope that our suggestions assist you in making an informed decision and enable you to proceed in whatever direction you decide to take, with more confidence and clarity.

Our Story

You are probably wondering who we are and what our motivation is in establishing this website? Well in short, we are just your average aussie working class couple. We are not IBO's and never have been, but we have family members that are current IBO's and thus our experience of Amway is from that perspective. We have set up this site with the hope of gaining more insight, knowledge and understanding of what the Australian Amway experience is. Our story below elaborates further.

(In the interest of our privacy and those of our family members, names in our story have been changed. Any resemblance to an actual IBO couple of the same names is purely coincidental and unintentional).

One day, our family members Tom & Jane presented the opportunity by asking us if we were interested at looking to earn some extra income by joining a "new booming internet based business" that also had Harvey Norman, Rebel Sports and some other large companies involved. All we had to do was purchase our groceries and other household goods through this new business and we would get up to 30% discount on our purchases. No selling was involved, we only had to buy from our own business and recruit others to do the same thing. By doing so, we had the potential to earn $50,000+ per year within 2-5 years by working 10-12 hours per week. We were then invited to a meeting where we could learn more about it.

Sounding a bit too good to be true, we asked some questions in which we didn't get any straight answers to but rather, Tom and Jane went on to talk about dreams and goals, that this was the best opportunity out there to achieve them and that we really should come to the meeting to find out more. Having already been familiar with Amway and the MLM concept, we asked them "Is this Amway? Tom replied "No". After a bit more probing though, it was revealed that the business was called IDA and that "Amway was just the supplier". We expressed our opinions about Amway and MLM's in general and told them our other reasons why we weren't interested in it.

We thought nothing more of it until a few days later when they called us to pitch the opportunity again and tried to persuade us into coming to the meeting. Again, we gave them our reasons and declined. After that phonecall though, we felt a little unnerved by some of the comments that Tom and Jane had made and yet we also found ourselves somewhat intrigued. Although still sceptical about it we wondered if we were indeed passing up a really good opportunity. It had been a long long time since we were last exposed to Amway or any other MLM business, (in fact, we thought that had Amway died off years ago!) so we thought well, we'll at least do a bit of research on IDA and suss out what they were all about and their connection with Amway.

Like most people do when they want to research information, we jumped on the internet and did a Google search. We didn't find anything about "IDA", so we googled "Amway". We checked out a few of the sites and did not like what we saw. The information we found was pretty much all negative and a lot of it concerned Quixtar (which we soon learn't was basically the name the Amway business was now known as in the USA). We found a little bit of info related to IDA and about Amway from the Australian perspective but it seemed quite dated. We didn't know if all this negative stuff was still happening, let alone if it was happening here in Australia. It really didn't matter whether it wasn't anyway. Those few pages we read were enough to turn us right off the whole thing and conclude that we wanted nothing to do with it.

Again we didn't think any more of it and assumed that Tom and Jane would do their own similar research, reach the same conclusion as us and that would be the end of it. It wasn't until a week or so later that we learn't that they had already signed up as IBO's and that we were actually one of the first few people that they had prospected. Surprised at this, we called and asked them if they had indeed really looked into the business thoroughly. At first, they assured us that they had checked it all out and knew what they were doing. We advised them to be careful anyway and pointed out some of the stuff we had read about. They got offended by that and we were quite stunned at how defensive, dismissive and snappy they were being towards us. It was quite out of their character. They didn't want to listen to anything else we had to say. Realising that we weren't getting anywhere with them and before the conversation got really heated, we ended it by just wishing them luck with it.

They were adults after all, who are more than capable of making their own decisions and free to live life how they pleased and we respected that. But still, we were a bit hurt that our concerns were brushed aside like they were and by some of the things they had said and the manner they said it. So we decided to forget about it and just trust that they knew what they were doing. In the interests of avoiding another possible unpleasant confrontation, we made a mental note to not say anything "bad" about the business whenever we got together in the future. We figured too, that if they didn't do well with it then they'd quit soon enough anyway.

After that exchange though, we noticed that we rarely saw or heard from them as often as we used to. Other family members and friends were saying the same thing. On the rare occasion when we did see them, they'd seem really happy and would say how fantastic the business was going. Of course, we were happy (and relieved even more so) to hear that but we all felt a little bit hurt and disappointed that they were missing family, social and sporting events and simply just weren't around much anymore. We couldn't understand it as we thought that the business was mean't to be a 10-12 hour a week thing and yet it seemed that all of their spare time was being spent on it.

Over the following months we would hear on the grapevine about what Tom and Jane were doing and everyone was noticing that they had changed. They weren't the same, yes they were happy and seemed closer as a couple, but their attitude and some of things they were saying and doing began to concern us. The more we heard the more concerned we became as it all began to sound a bit familiar. Familiar to some of the stuff we had read about on the internet a month or so prior. We felt compelled to go back and research the business in more depth.

We wanted to find out more about the business, how it worked exactly and gain a better understanding of what Tom & Jane were doing (since they never went into any great details about the business). We were wanting to find out why they were saying some of the things they did and what had caused their general attitude and persona to change. We wanted to get a good idea of what the typical IBO experience was and see how it related to Tom and Jane. We wanted to verify some statisical information and to see whether what they were doing and required to do in the future could actually bring them the success they had talked about.

So we spent many hours on the net searching for the information we wanted. We learn't about Amway's history, how it works, about the AMO's and their relationship with Amway, we read statistical articles and hundreds of testimonials from IBO's, ex-IBO's and from people like us, the loved ones of IBO's. Although the great majority of stuff we read about was from an overseas perspective, it was still all very eye-opening, in some cases very disturbing and we found too many similiarites to what we had heard, seen or experienced ourselves to dismiss them as irrelevant. Based on what we had researched, we concluded that the typical Amway/AMO experience was a universal thing.....and universally, a bad one.

We were that concerned and shocked, we printed off a dozen or so pages and gave them to Tom and Jane. We honestly thought that once they read them, they'd really take notice and realise that the business probably wasn't all that they believed it to be, much less give them the success that they wanted. Jane read the first page and angrily threw all the pages back at us. We were told in no uncertain terms that it was all garbage, we had no idea of what we talking about and that we should mind our own business. And so ever since then we have.

To this day, we have virtually no contact with Tom and Jane. What was once a close relationship between us has diminished to uncomfortable brief encounters void of warmth and sincerity. We've seen other relationships and friendships strained and tested. It is now an "us" and "them" situation. It seems that time with them is afforded according to where you stand about their business. Those who support/ed them (by being in their downline or buying the odd product through them) have close and constant contact, those who are neutral still have some contact and those who have been/are vocal with their concerns and do not support the business, well, they don't get much time of day at all.

As much as it is our opinion that Tom and Jane are the real victims in this, albeit unknowingly, we believe that we are victims too (hence the name of the site). We and other family members and friends feel ostracized simply because we have opinions that challenges and/or is contrary to Tom and Janes beliefs and way of thinking. We feel hurt, perplexed and yes angry that this business has impacted on us the way it has.

Despite all the research we have done and continue to do, we are trying to keep an open mind and still hold a faint glimmer of hope that we may have got it wrong. You see, we have based our opinions on our own experience and as stated earlier, on the information and experiences of others, the majority of which is not from the Australian perspective. There is still so little information on the net that is from the Australian perspective and we felt that there was a need for a site like this which is dedicated to the Australian Amway/AMO experience. So we took it upon ourselves to establish one.

We hope that by inviting the public to share their stories and opinions, we can obtain a greater understanding and knowledge of the Australian Amway experience. In doing so, we believe that a more accurate picture of what's happened in the past and more importantly, what is happening now will be revealed. We hope that over time, this site will become a valuable resource for anyone interested in researching Amway, whether it be as a current IBO, a potential IBO, an ex-IBO or the family and friends of IBO's.

We therefore invite you to share your Amway experience, whether it is or was a positive one, a negative one or anything in-between, it doesn't matter, all we're simply after is the truth.....your truth.

To share your story, write to us at ozamwayvictims@yahoo.com

About ozamwayvictims.com

The Home page of ozamwayvictims.com

Amway and it’s Amway Motivational Organisation's (AMO’s) has impacted on the lives of millions of people around the world over the last 40+ years and continues to do so today. It is the largest, oldest and arguably the most controversial Multi-level Marketing (MLM) business in the world.

Thousands of people have shared their personal stories, experiences, opinions and thoughts, both positive and negative, about Amway. Thanks to the advent and growth of the internet, these stories and opinions can be found and read by with just a few keystrokes. To the casual observer, it seems that the majority of these stories are very critical and negative in nature. The most common criticisms of Amway that are voiced are about: the AMO's "Tools" systems, the misleading information given by AMO's and Amway's distributors which are known as Independant Business Owners (IBO's)*, the overpriced/uncompetitive products and shipping fees, the poor compensation plan, the large amounts of time and expenses involved and most importantly, the detrimental impact the business has had, or is having on peoples lives and their personal, social and business relationships.

Critics and victims of Amway are abound and they're not afraid to have their say. On the flipside are the supporters of Amway, the IBO's who network, promote their business/AMO systems and share what is positive about the business. They also defend the business against the criticisms made by the critics and victims. Many IBO's claim that they themselves and their business are victims too due to all the negativity and criticism that is about. In any case, the feelings and opinions on both sides are strong and the debate is often fierce, as it has been for many years.

However, the stories, opinions and information which is the most relevant to us, that is, from the Australian perspective, can be difficult to find as they seem to be scattered on various sites and are often amongst and/or outnumbered by other stories and information, which relate specifically to the overseas experience (namely Quixtar), the other AMO's or other MLM's altogether.

So what exactly is the Australian Amway experience then? Is it same as the overseas experience? Do the AMO's here operate similar to the other AMO's elsewhere and how are they different? Do we share the same common criticisms and are they as prevalent? Are the opinions and feelings as strong and the debate between the critics and supporters as fierce? How do we compare to the rest of the world? What was the Amway/AMO experience in the past and more importantly, what is it like now?

This site (and now blog) has been established with the aim to answer these questions by providing the opportunity for the Australian public to tell the story of their own Amway experience, to share their thoughts and opinions and basically just have their say about all things Amway and/or it's AMO's. So whether you have been directly involved with Amway as a past, present or potential IBO, if your a relative, loved one, friend, colleague of an IBO or otherwise, then we invite you to share your story.

So What is Amway?

Amway (representing "American Way") is a multi-level marketing (MLM) or technically called 'network marketing' company founded in 1959 by Jay Van Andel and Rich DeVos and is based in Ada, Michigan USA. It manufactures, markets and sells product lines such as laundry products, personal care products, dietary supplements and cosmetics to name a few. It also sells other products and services offered through it's "partner stores". Amway operates in approx. 80 countries worldwide.

Quixtar: In 1999 the founders of the Amway corporation launched a sister (and seperate) internet based company named Quixtar. The Alticor corporation owns both Amway and Quixtar, plus several other concerns. Quixtar replaced the North American business of Amway in 2000. However, the Corporation recently announced that the Quixtar name will be phased out over the next two years and will be replaced with the original Amway name.

How It Works:

To sell Amway products one must register as a distributor (Independant Business Owner - IBO)* and must be sponsored into the business by an existing IBO, who becomes your "upline". IBOs can recruit other IBO's (downline). This progressive line of people (in order from the top to the bottom) is called a Line of Sponsorship (LOS)/Line Of Affiliation (LOA), like a family tree. These families are also known as Amway Motivational Organizations (AMO's) and are independant companies formed by the high level distributors.

The business plan of today is commonly presented as a "buy from yourself and teach others to do the same" (BFYTODS) model. That is where IBO's buy products at Amway's wholesale (IBO) cost for personal consumption/sales and recruit others to do the same. Rebates/Bonuses are calculated based on the total monthly volume of products ordered by the IBO and the downline they have sponsored into the group. Commissions are also earnt from retail sales made to consumers (non-IBO's). Recently the Corporation has begun to plan/implement changes that places more emphasis on the retail/selling of products to consumers.

Rebates/Bonuses are not calculated by the actual dollar amounts of the products but rather on a point based system using a method of calculation called point value (PV) and business volume (BV). Each product is assigned a point value (PV) based on the type of product, that is, whether it is a "core" Amway product (or products available by exclusive arrangements) or non-core products. The core line products generally attract high PV (100%) whereas the non-core products can have a PV as low as 10%.

The total monthly PV determines the performance bonus bracket achieved. As can be seen from the following table the higher PV level achieved the higher the percentage of rebate/bonus earn't.

100 pv = 3%

400 pv = 6%

1000 pv = 9%

2000 pv = 12%

3250 pv = 15%

5000 pv = 18%

7500 pv = 21%

Business Volume (BV) is the dollar amount assigned to each product. The total monthly business volume is multiplied by the percentage achieved in the peformance bonus bracket (PV level) to calculate the gross rebate/bonus amount the IBO receives. Any rebates/bonus earn't from the IBO's downline is then subtracted from this gross rebate/bonus amount to arrive at the IBO's net rebate/bonus.

An IBO would generally need to spend/retail a minimum of approx. $340-$400 to achieve the lowest performance bracket of 100PV (3%).

What is an Amway Motivational Organisation (AMO)?

As stated earlier AMO's are organisations that are independant from the Amway Coporation but are run by IBO's who have reached the highest pin levels of Amway (eg Diamonds and above). They exist to provide independantly produced and distributed Business Support Materials (BSM) which are commonly referred to as "Tools", for purchase by other IBO's in thier LOS/LOA.

Tools are motivational and training aids or services that can consist of books, magazines and other literature, audio tapes, cd's, videos, software, websites, internet services and other electronic media, rallies, meetings and educational seminars.

There are many AMO's operating worldwide. Some of these include InterNET, Britt World Wide (BWW), Worldwide Dreambuilders (WWDB), International Dreambuilders Association/Interactive Digital Alliance (IDA) and Network 21 (N21), eFinity, ILD & iTeam.

The two major AMO’s operating in Australia are IDA and Network 21.

* Amway distributors are referred to by various names depending on which country they operate in. The most common term is IBO (Independent Business Owner). In other parts of the world they are referred to as ABO's (Amway Business Owners). Recently, the term for Australian Amway distributors (IBO) has changed to AIBO (Amway Independent Business Owner). For simplicity, this site uses the term IBO to refer to all Amway distributors.


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DISCLAIMER: This site is wholly independant. The site content has been based on information freely available on the internet and from personal experiences and opinions of the authors. The authors do not claim to be of any authority, legal or otherwise, regarding the content of the site and should not be considered as such. This site allows the general public to freely submit their own personal testimonies for publication. The site authors will not be held responsible for the content submitted by site visitors or any actions taken by site visitors as a result of the content submitted or other content contained on the site.

Ozamwayvictims.com

We have decided that we will not be renewing the ozamwayvictims.com website and as such the site will be wound up within the next couple of months.

Rather than lose all the info that is contained on the website, over the upcoming weeks we will be gradually transferring each relevant section of the website over to this blog. If anyone wishes to copy and paste any of the website pages to their own site, then feel free to do so, but please be kind enough to note this blog address as the source.

Any new testimonials that we may receive from hereon will be posted as a seperate blog post.

Cheers!

DBERR vs Amway UK - Judgement Made

The judge has finally handed down his ruling, which was in favour of Amway UK. Read about it here:

http://blog.mlive.com/grpress/2008/05/uk_dismisses_claims_against_am.html

It's late here, so we'll comment more on the decision at a later time.