Thursday, May 22, 2008


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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.

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.

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