Friday, May 30, 2008

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.


* 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: and )

* 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: 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?


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.

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