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Old 5th November 2009, 10:42 AM   #161
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Quote:
I've been an IBO for 10 years and have business in 6 countries
Making, after expenses, perhaps $1 in profit per hour invested, if that.

What's the point of being an "international businessman" when the income is so pathetic?

This isn't really being a businessman; it's playing businessman.
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Old 5th November 2009, 12:25 PM   #162
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Originally Posted by Darth Rotor View Post
I met two guys, just under thirty years ago, who were very successful in Amway. Rex Renfro and Angelo Nardoni. (IIRC my spelling memory is still good).

No idea if they are still in the biz.
Both still in the biz, though Rex Renfrow has split with Britt and is part of an organisation called UR Association. Angelo Nardone is still with Britt World Wide

Quote:
One reason I didn't get started in the biz was very simple: I was about to get orders to another state. Another was that I did a little math on how geometric progressions work and got a weird answer on MY prospects for spreading into the community with sales of off brand products in my spare time.
It's not a geometric progression. The "plan" shown at open previews is an idealised simplified model for getting the concept across. Furthermore, the idea of networking is to spread out of your community by networking with people who know people outside of your community.

Quote:
What it didn't show was any acknowledgement of how costs of running a network went up. It also set off my internal flag about market saturation.
I'm not sure why you think the costs of a network go up?

As for market saturation, that's an issue for any business. There's nothing to suggest any current Amway market is "saturated"

Quote:
The effort is a constant "education" or sales pitch effort that is required to sustain the product and brand loyalty.
Not quite, but closer to what we do then others here have mentioned. It's an ongoing process of education to get product and brand loyalty, but you don't need to do much to maintain it. What you can do of course is increase your turnover by cross-selling additional products to the customer, which would involve further education.

Quote:
I looked at how I got introduced, how many people were in the room, and concluded that for my county, the saturation level of that product had already been reached.
Every single person in your county was already buying Amway products? Color me skeptical

It's not a static market. In fact one of the best markets for customers of Amway products is former distributors. Most are former either because it just wasn't the right time for them or they had issues with their upline rather than Amway or the products.

Quote:
Some of the other stuff I didn't get a sense of until years later. The necessity for me, if I was to make good money at this, was to find semi virgin territory for building and sustaning a network.
I think probably the missing key in this is the "systems" that Newton Trino is so enamored of. They've developed things like internet sites for explaining the business remotely, they've seminars and plan showings around the country (and world) which you can plug into. Rather than have to travel miles to explain the business to someone you can send them a DVD or CD or MP3 or refer them to a website etc etc etc.

If you're trying to do it all yourself, then yeah, nightmare!

Last edited by icerat; 5th November 2009 at 01:22 PM.
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Old 5th November 2009, 12:31 PM   #163
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Originally Posted by Skeptic View Post
Making, after expenses, perhaps $1 in profit per hour invested, if that.

What's the point of being an "international businessman" when the income is so pathetic?

This isn't really being a businessman; it's playing businessman.
BINGO!!

This is where you've got such cognitive dissonance. I have business in multiple countries, and I have experience about how things are run in multiple countries, but I am by no means an "international businessman" (not in this field anyway)

Why oh why do you believe that people playing businessman should be making an income?

I don't think I should be making a significant income now. I've done bugger all to create one.

On what basis do you think I should be?
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Old 5th November 2009, 12:41 PM   #164
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You keep telling us what a wonderful opportunity MLM is.

Yet you yourself, despite doing it "for 10 years" and "in 6 countries", haven't made more in it than minimum wage would have made, if that.

Who are we supposed to believe -- your stories, or our own lyin' eyes?
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Old 5th November 2009, 01:07 PM   #165
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Originally Posted by Skeptic View Post
You keep telling us what a wonderful opportunity MLM is.
No, what I do is keep pointing where claims you and others make is not backed up by the evidence.

Amway is not the only opportunity.
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Old 5th November 2009, 02:46 PM   #166
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Yes, they are true.

The evidence is that 99.5%+ lose money or make less than minimum wage.

You claim this is somehow not true because for this or that or the other reason all the 99%+ who lose money don't count: most of them just joined for the products, some have not bought enough tools, and the rest simply didn't follow the plan "the right way" or had "not put enough effort into it".

Clearly, you think that in order to be really objective about the chance of success in an MLM, you need to only look at those who are really serious -- the 0.5% or so who make significant money. Their chance of success is, unsurprisingly, 100%.

There's no arguing with that kind of logic.

There's only pointing and laughing.
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Old 5th November 2009, 03:26 PM   #167
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Originally Posted by icerat View Post
Oh yeah, there's no body left to sell skin care, cosmetics, nutritional supplements, sports drinks, etc etc too. Everyone is already buying Amway
Yes, people buy cosmetics and so forth. But that doesn't mean that they necessarily want to buy the goods sold by Amway at the prices charged by Amway. To think otherwise is just wrong.

As you yourself point out, only one quarter of the people who are actually committed enough to Amway products to register actually remain after one year. Three quarters don't seem to value Amway products enough to keep buying them after a year. How many of the purely retail customers regularly puchase from Amway?

Originally Posted by icerat View Post
not to mention the FTC has explictly stated the direct opposite to what you claim.

You may want to tell the FTC that then. They seem to think there is a requirement that sales be made outside of the pyramid.

Isn't it funny that everytime the FTC has another look at how to protect people from pyramid schemes Amway changes its model.
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Old 5th November 2009, 03:36 PM   #168
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Originally Posted by icerat View Post
It's not a geometric progression. The "plan" shown at open previews is an idealised simplified model for getting the concept across.
So, its not a geometric progression, its just presented as a geometric progression.

Originally Posted by icerat View Post
Furthermore, the idea of networking is to spread out of your community by networking with people who know people outside of your community.
Yes. Spreading into other communities which are already being worked by somebody else. While people from other communities are also trying to work your community.



Originally Posted by icerat View Post
I'm not sure why you think the costs of a network go up?
Maybe because it is much harder to work a community that you don't already have contacts in?


Originally Posted by icerat View Post
Every single person in your county was already buying Amway products? Color me skeptical
I know that is the hype you sell but I wonder if you actually believe that.
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Old 5th November 2009, 04:05 PM   #169
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Originally Posted by Skeptic View Post
Yes, they are true.

The evidence is that 99.5%+ lose money or make less than minimum wage.
This is a different claim altogether. I have no problem at all in agreeing that most "make less than the minimum wage".

What I'm curious about is why you think they should be?
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Old 5th November 2009, 04:19 PM   #170
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Originally Posted by gtc View Post
Yes, people buy cosmetics and so forth. But that doesn't mean that they necessarily want to buy the goods sold by Amway at the prices charged by Amway. To think otherwise is just wrong.
Of course, but given Amway cosmetics are cheaper than their independently judged competitiors (source: Euromonitor) there's no reason to think that the majority of people, who have never heard of the brand (source: Amway research) would not be willing to give it a try.

There's zero reason to believe the market for Amway skin care and cosmetics is even remotely saturated.

Quote:
As you yourself point out, only one quarter of the people who are actually committed enough to Amway products to register actually remain after one year.
On what basis do you think registering means they're "committed enough to Amway products"? Given half of them never place an order that's a bit of a leap. Since (in the US) they get 6 months to try the business out, and the joining fee ($50) is small and refundable, it's seems far more likely they thought they'd give it a shot, and then for whatever reason didn't do anything with it.

Quote:
Three quarters don't seem to value Amway products enough to keep buying them after a year. How many of the purely retail customers regularly puchase from Amway?
First of all, it was reported in one of the independent books on Amway (I forget which) that about 25% of those who do not renew actually remain as customers of another IBO - this is by far the majority of those who actually order and try the products.

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You may want to tell the FTC that then. They seem to think there is a requirement that sales be made outside of the pyramid.
That's not what it says at all. What it says is that a lack of outside sales is a "red flag" that something could be a pyramid. I entirely agree. It's not a requirement though. What having "outside sales" does is give one indication that you have legitimate products at a legitimate price, even at the much higher full retail price. The FTC has since explicitly clarified that

In fact, the amount of internal consumption in any multi-level compensation business does not determine whether or not the FTC will consider the plan a pyramid scheme.

Other issues you might look at are price comparisons, consumer acceptance, expert evaluations of the products etc etc etc. I 100% agree that there are companies out there purporting to be legitimate MLMs that are likely pyramid scams hiding under a bogus product.

Quote:
Isn't it funny that everytime the FTC has another look at how to protect people from pyramid schemes Amway changes its model.
Huh? I've no idea what you're talking about here. Amway in the US hasn't significantly changed it's model since it began.
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Old 5th November 2009, 04:23 PM   #171
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Originally Posted by gtc View Post
Yes. Spreading into other communities which are already being worked by somebody else. While people from other communities are also trying to work your community.
This is an issue in any business and one has to make a case by case evaluation. Outside perhaps of very small towns there's no evidence this has been a significant issue in Amway in the US. There continue to be 500 to 1000 new "platinums" and above every year in North America.

Quote:
Maybe because it is much harder to work a community that you don't already have contacts in?
Sure, who said it was supposed to be easy? But the idea is that you work with people who *do* have contacts in that community.

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I know that is the hype you sell but I wonder if you actually believe that.
Not sure what you're referring to here.
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Old 5th November 2009, 04:29 PM   #172
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BTW for everyone reading this spin machine never ever ever stops.

If anyone is interested in seeing responses feel free to look at the hundreds of posts where we've gone over these issues in other threads.
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Old 5th November 2009, 05:55 PM   #173
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Originally Posted by icerat View Post
That's not what it says at all. What it says is that a lack of outside sales is a "red flag" that something could be a pyramid. I entirely agree. It's not a requirement though. What having "outside sales" does is give one indication that you have legitimate products at a legitimate price, even at the much higher full retail price. The FTC has since explicitly clarified that

In fact, the amount of internal consumption in any multi-level compensation business does not determine whether or not the FTC will consider the plan a pyramid scheme.

Other issues you might look at are price comparisons, consumer acceptance, expert evaluations of the products etc etc etc. I 100% agree that there are companies out there purporting to be legitimate MLMs that are likely pyramid scams hiding under a bogus product.
Odd, you are spinning that paragraph to suggest that significant sales outside the pyramid aren't needed. Further on in the document though the FTC seems to be saying that just because a Pyramid achieves a certain amount of retail sales doesn't mean that it isn't a scam:


Quote:

The Commission's recent cases, however, demonstrate that the sale of goods and service; alone does not necessarily render a multi-level system legitimate. Modem pyramid schemes generally do not blatantly base commissions on the outright payment of fees, but instead try to disguise these payments
to appear as if they are based on the sale of goods or services. The most common means employed to achieve this goal is to require a certain level of monthly purchases to qualify for commissions. While the sale of goods and services nominally generates all commissions in a system primarily funded by
such purchases, in fact, those commissions are funded by purchases made to obtain the right to participate in the scheme. Each individual who profits, therefore, does so primarily from the payments of others who are themselves making payments in order to obtain their own profit. As discussed above, such a plan is little more than a transfer scheme, dooming the vast majority of participants to financial failure



Originally Posted by icerat View Post
Huh? I've no idea what you're talking about here. Amway in the US hasn't significantly changed it's model since it began.
You know that is not really true (unless you redefine significant and I suspect you do).
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Old 5th November 2009, 06:57 PM   #174
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Originally Posted by gtc View Post
Odd, you are spinning that paragraph to suggest that significant sales outside the pyramid aren't needed.
No spin necessary. That's exactly what it says.

Quote:
Further on in the document though the FTC seems to be saying that just because a Pyramid achieves a certain amount of retail sales doesn't mean that it isn't a scam:
non sequitur.

Just because you don't need external sales to not be a pyramid doesn't mean having external sales means you're not a pyramid (though it is supporting evidence). In any case, the section you cited was about internal sales, not external sales.

you know, when I first joined this forum (not for MLM discussion!) I was hoping it was full of nice, rational, logical people. It was pretty disappointing to find I was wrong.

Quote:
You know that is not really true (unless you redefine significant and I suspect you do).
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Neither of those articles refer to significant changes in Amway's marketing model. What has changed in recent years is greater monitoring of the field and enforcement of rules. In the past Amway has pretty much hidden behind the "independence" of reps when they do the wrong thing. The UK case showed they can't do that any more - a very positive thing in my view, but I still don't see it as a "significant" change in the business model, no.
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Old 5th November 2009, 07:06 PM   #175
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Originally Posted by icerat View Post
you know, when I first joined this forum (not for MLM discussion!) I was hoping it was full of nice, rational, logical people. It was pretty disappointing to find I was wrong.
That's an awfully large slam on an entire community for someone who is complaining about ad hominems against themselves.

Let me ask a question. Have you ever considered the idea that you could be wrong? That maybe you've been influenced by some very astute manipulators?
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Old 5th November 2009, 07:33 PM   #176
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Originally Posted by icerat View Post
No spin necessary. That's exactly what it says.
I would like to think that you actually believe that.

Originally Posted by icerat View Post
you know, when I first joined this forum (not for MLM discussion!) I was hoping it was full of nice, rational, logical people. It was pretty disappointing to find I was wrong.
Pass me a hanky, icerat doesn't like me.
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Old 6th November 2009, 02:07 AM   #177
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Originally Posted by NewtonTrino View Post
That's an awfully large slam on an entire community for someone who is complaining about ad hominems against themselves.
Perhaps a difference in use of language. When I meant "full of" I didn't mean "entirely composed of", though I can certainly read it that way myself. A poor choice of words. Mea culpa.

Quote:
Let me ask a question. Have you ever considered the idea that you could be wrong? That maybe you've been influenced by some very astute manipulators?
Well you're first of all you're telling me to consider I'm wrong about my own experience. Amway paid me exactly the amount the business plan said it would, every single month, and continue to do so. I've never encountered a report from anyone where they haven't done this (excepting legal disputes where they've withheld payments, which was an a**hole thing to do in my opinion). My own experience influenced me.

You're then asking me to ignore the very clear and sensible logic of the model. This clear logic influenced me.

You're then asking me to ignore the many, many, many independent awards the company has won. I doubt there's too many people in the world who have researched into Amway as much as I have, and the more I learn the MORE impressed I am (aside from the legal department, whom I think are a bunch of ... well, lawyers) All the independent awards influenced me.

You're asking me to ignore my own experiences with the products, which is that they're almost universally (not entirely) the best I've used in their category. My own experience influenced me.

You're asking to ignore my years of statistical training and work, which when applied to the evidence seems to indicate pretty clearly that the group(s) creating complaints are the outliers, not my experience. My own knowledge and experience influenced me.

You're asking me to ignore the works of respected academics like Professor Xardel for example - he was head of ESSEC for crying out loud! Yes, he too influenced me.

You're asking me to ignore the many customers I have who love the products and purchase them regularly.

You're asking me to ignore my own mother, who used to buy the products when I was a kid, and was happy when I joined because it meant she had easy access to them again.

You're asking me to ignore my own brother, who is an IBO in another group (B/Y affiliated) and want's nothing to do with the business side any more because of things he experienced with them that I don't experience - yet he renews his membership every year because they're great products.

What you instead are asking me to do is believe that I and all of these other independent sources are somehow wrong.

You're asking me to disbelieve logic.
You're asking me to disbelieve academic business experts.
You're asking me to disbelieve experts in market research.
You're asking me to disbeieve me.
You're asking me to disbelieve good friends, a number of whom I've known since school, whom I have seen progress from new IBOs to very high levels, and to believe that for some reason that makes no sense at all, that the business model which has proved entirely accurate for me personally, has somehow broken down and stopped working for no apparent reason for them - and that they're then lying to me and other people about it.

Then of course you're asking me to believe that hundreds of governments, and government departments and judiciary around the world, of all different political hues, over the space of decades, that they've all miraculously duped.

That's everything you're asking me to do.

A far more rational thing to do is to believe that in a business involving millions of people over five decades, that there'll be a significant number who of operated their businesses differently to what I've experience. I don't ask Scheibeler, or you, or anyone else to deny their own experience and all these experts. All I ask them to do is consider the possibility that their experience is not necessarily a typical one.

Given that's exactly what a statistical analysis of "complaints" against Amway suggests it would seem to me a far more rational explanation than the fantastical conspiracy that you would have me accept.

Have you ever considered the idea that YOU may be wrong? That perhaps the reason I'm saying my experience is different is because it actually is?

Why is that so difficult for you to consider?
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Old 6th November 2009, 08:06 AM   #178
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Well, it's certainly been an educational thread and try as I did i find it difficult to find fault with the Amway model other than their restrictions on sales/marketing their products in a competitive market.

I did find sever examples of "problems with people" which is by no means unique to the MLM model. I'm mainly seeing people who ran small business without having a clue as to what they're getting into and treating it more like a regular job than a business.

Originally Posted by icerat
I don't ask Scheibeler, or you, or anyone else to deny their own experience and all these experts. All I ask them to do is consider the possibility that their experience is not necessarily a typical one.
He's the guy mentioned in the rickross site, the one linked to in post 173 right? the guy who thought he was making $100-150 k/year and "found out" he was only making $34K after 9 years. The guy who ended up $100K in debt.

How do you do that, exactly? Surely there must have been warning signs in those in those ( years, warning signs that he was running a business at a loss but for reasons that aren't clear to me, he kept slogging on, spending money when he HAD to have known that this was a loosing proposition and this seems like it was HIS problem, not a problem with Amway.

As an aside, I had a friend who did exactly this. he ran a store which was initially profitable but became a money looser after a time yet he continued with that business until all his credit was spent, forcing him to close the doors. He freely admits keeping this business open was a bad decision and he has no one to blame but himself.

Maybe this is what happened to Scheibeler, he was a bad businessman who decided to blame "the system" rather than admit he might have been at fault. Nine years....

Or there's this guy, also from the rickross page.

Quote:
Chip Minto, a former distributor from Philadelphia, said he spent as much as $800 to $1,000 a month on the motivational events and materials. He was earning, on average, $85 a month.
How could he not see this ? Spending 10X his income on "motivational events and materials" That's quite a lot of materials and obviously Chip decided to put his time and energy into perusing those materials rather than going out and getting customers. Was he aware of how little money he was making ? If not, why not ? Didn't he do a month end every month, or was he on the "toss the paperwork in a shoebox and worry about it later plan" ?

If there's no requirement from Amway to purchase these materials, only strong suggestion from the upline then IMO these people who haemorrhage this kind of cash into those materials are being pressure sold. Given my limited past experience with Amway, Chip should have been aware of pressure sales techniques as Amway IBO aren't exactly known for their passive approach.

I did manage to catch an Amway TV ad last night, a rarity for me because I own a PVR ( hey, you want me to shill for an invention ? that would be the one ) so TV commercials are a thing of the past. It just so happened I hit live TV just as the ad started and when I heard "Amway" in honour of this thread, I watched it. It looked good, featuring Artistry and Nutrilite and recommended the viewer contact "a local IBO". This is where i see a problem with the Amway system, if i wanted to contact an IBO right now, I have the publicly available information to contact exactly 1 of them. in a city of 350K people.

Speaking of TV ads and Amway, I had to google SA8 because i didn't know what it was and I found this rather amusing commercial on YouTube
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Old 6th November 2009, 08:51 AM   #179
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Originally Posted by icerat View Post
Well you're first of all you're telling me to consider I'm wrong about my own experience. Amway paid me exactly the amount the business plan said it would, every single month, and continue to do so. I've never encountered a report from anyone where they haven't done this (excepting legal disputes where they've withheld payments, which was an a**hole thing to do in my opinion). My own experience influenced me.

You're then asking me to ignore the very clear and sensible logic of the model. This clear logic influenced me.
The logic isn't clear at all frankly. You need to have a bunch of suckers losing money to make any amount of decent money. How is that sane?


Quote:
You're then asking me to ignore the many, many, many independent awards the company has won. I doubt there's too many people in the world who have researched into Amway as much as I have, and the more I learn the MORE impressed I am (aside from the legal department, whom I think are a bunch of ... well, lawyers) All the independent awards influenced me.
ROTFLMA. Awards are thrown around like popcorn and frankly mean nothing.

Quote:
You're asking me to ignore my own experiences with the products, which is that they're almost universally (not entirely) the best I've used in their category. My own experience influenced me.
As someone who has used amway products for many many years I have to disagree. Some of the products are passable. Most of them are IMHO not good at all. I especially dislike many of the fragrance choices.

Quote:
You're asking to ignore my years of statistical training and work, which when applied to the evidence seems to indicate pretty clearly that the group(s) creating complaints are the outliers, not my experience. My own knowledge and experience influenced me.
I think this is wishful thinking on your part. It seems more like the groups not causing trouble are the outliers to me. Find me a group that sells tools without sucking massive dollars out of the organization into a side business. N21 sells just as many tools as anyone else.

Quote:
You're asking me to ignore the works of respected academics like Professor Xardel for example - he was head of ESSEC for crying out loud! Yes, he too influenced me.
There are plenty of people out there to shill for pretty much ANYTHING. Just look at the numbers of people defending religion for example. If I call out the catholic church as being a death cult in public people will attack me. Doesn't mean I'm wrong.

Quote:
You're asking me to ignore the many customers I have who love the products and purchase them regularly.


You're asking me to ignore my own mother, who used to buy the products when I was a kid, and was happy when I joined because it meant she had easy access to them again.
Again this is part of the amway model. Use your relationship with your friends and family to get them to buy product. You're not under the illusion that all of these people will always be honest with you are you? I'm not saying your mother is lying BTW, but I'm positive that some amway distributors mothers ARE lying to them because they want to support their children.

Quote:
You're asking me to ignore my own brother, who is an IBO in another group (B/Y affiliated) and want's nothing to do with the business side any more because of things he experienced with them that I don't experience - yet he renews his membership every year because they're great products.
Bring him on here to talk about his experiences! I would like to hear this directly from him and I would also like to hear about why he doesn't want anything to do with Britt / Yeager. Does he agree N21 is better like you think? Let's hear it from him!

Quote:
What you instead are asking me to do is believe that I and all of these other independent sources are somehow wrong.
I know in my heart jesus is real and died on the cross. I know in my heart telepathy is real. I know I can dowse!!! Are you asking me to ignore the fact that I found water!!! Humans are fallible icerat. So yes, ALL of the sources could be deluded about amway. It's not even a stretch to think this. Human society is far from perfect.

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You're asking me to disbelieve logic.
You're asking me to disbelieve academic business experts.
You're asking me to disbelieve experts in market research.
You're asking me to disbeieve me.
You're asking me to disbelieve good friends, a number of whom I've known since school, whom I have seen progress from new IBOs to very high levels, and to believe that for some reason that makes no sense at all, that the business model which has proved entirely accurate for me personally, has somehow broken down and stopped working for no apparent reason for them - and that they're then lying to me and other people about it.
Yes, I'm saying that you could be wrong on all of the points. As to the last one I've never claimed you cannot make money in amway. Some people will succeed and build large organizations. My claim is that this is UNETHICAL due to the selling of tools and the fact that most of the money made will be on the backs of people losing money. Also the chances of "making it" are hugely exaggerated. And when you do make it most of your income is going to be tools money.

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Then of course you're asking me to believe that hundreds of governments, and government departments and judiciary around the world, of all different political hues, over the space of decades, that they've all miraculously duped.
Like governments are supposed to know how to regulate this stuff? Gimme a break. Keep in mind not every government has been duped, take a look at the UK. Personally I'm not a huge fan of government regulation anyway but they certainly aren't very capable of understanding complicated scams like this. Not to mention that money can be used to sway politics...

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That's everything you're asking me to do.
Honestly icerat, this is an argument from incredulity. A hardcore religious believer would make the same kind of argument as this. Yes, there is no god. Too bad so sad.

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A far more rational thing to do is to believe that in a business involving millions of people over five decades, that there'll be a significant number who of operated their businesses differently to what I've experience. I don't ask Scheibeler, or you, or anyone else to deny their own experience and all these experts. All I ask them to do is consider the possibility that their experience is not necessarily a typical one.
But the same abuses are still happening. N21 is still stuffing overpriced tools down the pipeline. You simply happen to like them and think they are a good value. Since this is the ENTIRE POINT of the tools (to make you think this) it's not surprising. Sure the groups have been evolving because it was evolve or die. But have they actually changed the model, or has the camouflage just gotten better?

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Given that's exactly what a statistical analysis of "complaints" against Amway suggests it would seem to me a far more rational explanation than the fantastical conspiracy that you would have me accept.
Who said anything about a conspiracy? It's just a bunch of guys trying to make money. Are you telling me that the tools were ALWAYS out in the open? Even now it's not clear where the tool money is going in N21 (other than into your uplines pocket). It certainly isn't being spent on "overhead" like you seem to think.

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Have you ever considered the idea that YOU may be wrong? That perhaps the reason I'm saying my experience is different is because it actually is?
Absolutely. This is one of the reasons I decided to talk to a high level diamond a while back. He was EXTREMELY evasive and pretty much confirmed that my thoughts are valid.

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Why is that so difficult for you to consider?
Like I said, I have considered it.

FACT: most people in amway lose money.
FACT: the big pins make significant portions of their income from selling CD's, seminars etc. This was kept secret for many years until you were in the club.
FACT: N21 sells millions in tools into it's organization every year.

Maybe the message has softened a bit from the 80's but the fundamental scam is the same. Bring in suckers, sell them the dream (tools). Keep them in as long as possible. If this sounds cynical to you it just means you haven't leveled up enough yet. You pretty much have to be a sociopath to be a diamond...

I will say that I can tell you are a smart guy. So is my dad who has been involved for 30 years. There is a difference between IQ and the ability to think rationally. Just consider the fact that the tools may have warped your thinking on this issue.

I think if you really want to make money that you would be a lot better off starting another kind of business. At least it would be ethical (at least I hope you would choose something ethical!).
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Old 6th November 2009, 08:57 AM   #180
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Originally Posted by Stout View Post
Well, it's certainly been an educational thread and try as I did i find it difficult to find fault with the Amway model other than their restrictions on sales/marketing their products in a competitive market.

I did find sever examples of "problems with people" which is by no means unique to the MLM model. I'm mainly seeing people who ran small business without having a clue as to what they're getting into and treating it more like a regular job than a business.
You are misunderstanding the issue a bit. The upline in amway actively messes with peoples heads.

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He's the guy mentioned in the rickross site, the one linked to in post 173 right? the guy who thought he was making $100-150 k/year and "found out" he was only making $34K after 9 years. The guy who ended up $100K in debt.
Have you read the book?

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How do you do that, exactly? Surely there must have been warning signs in those in those ( years, warning signs that he was running a business at a loss but for reasons that aren't clear to me, he kept slogging on, spending money when he HAD to have known that this was a loosing proposition and this seems like it was HIS problem, not a problem with Amway.
It was his upline. I think even icerat would agree that this guy had a particularly bad upline who took advantage of him. Icerat?


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How could he not see this ? Spending 10X his income on "motivational events and materials" That's quite a lot of materials and obviously Chip decided to put his time and energy into perusing those materials rather than going out and getting customers. Was he aware of how little money he was making ? If not, why not ? Didn't he do a month end every month, or was he on the "toss the paperwork in a shoebox and worry about it later plan" ?
The upline makes their money from this so they push it hard. Some people go overboard as well. $800-1000 a month doesn't sound impossible to spend on tools though if you do thinks like fly to seminars in other cities etc.
People are told to focus on things besides profitability and it makes sense. Most business are going to run at a loss for at least some small initial period.


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If there's no requirement from Amway to purchase these materials, only strong suggestion from the upline then IMO these people who haemorrhage this kind of cash into those materials are being pressure sold. Given my limited past experience with Amway, Chip should have been aware of pressure sales techniques as Amway IBO aren't exactly known for their passive approach.
The suckers are always the last one to figure it out. The whole point of these techniques is that they work in influencing people. Keep in mind that the seminars, CD's etc all say the same thing (buy more of us!).
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Old 6th November 2009, 09:41 AM   #181
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Originally Posted by NewtonTrino View Post
You are misunderstanding the issue a bit. The upline in amway actively messes with peoples heads.
Yes, I understand how the upline could/does do this but maybe I'm too skeptical about allowing people to mess with my head that I'd take one look at a "motivational" product and see it for what it is and reject any further purchases of those products citing my desire to but my time and effort into building my business. IMO, viewing motivational material comes under the category of unpaid labour unless I'm really, truly, learning something from it.

I never have "learned" anything from that type of propaganda, sure I've been caught up in the hype, but as soon as I realised what it was then those lessons were translated to just that, hype.

Once, while I was a government employee, a manager decided to subject up to Covey leadership training, three days worth. Nobody, and I mean nobody was able to take those little motivational anecdotes seriously and those three days were spent between joking about the lessons on coffee breaks and trying to stay awake during the seminar itself. The feedback that was sent to management consisted of...If you want us to take ownership of out jobs and work more efficiently, then stop wasting out time having us sit through this sort of stuff and actually let us do our jobs, we just lost three days labour on this, multiply 3 days times 30 people, and you have over 600 hours of work lost.

No I haven't read the book.

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The upline makes their money from this so they push it hard. Some people go overboard as well. $800-1000 a month doesn't sound impossible to spend on tools though if you do thinks like fly to seminars in other cities etc.
Agreed, i mentioned a friend i had who spent all of her savings travelling to exotic destinations caught up in all the Herbalife hype. Why, someone would feel the need to do this for a business that's in it's infancy. I don't know. Wouldn't those Cds/tapes/videos of past seminars have sufficed until the IBO was actually making enough money to offset those expenses ? they sure would have for me.

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People are told to focus on things besides profitability and it makes sense.
I suppose, things like product knowledge are very important especially when it comes to lines like Artistry and Nutrilite. These are a far cry from simply selling concentrated cleaning products. In this case you may have to spend, or invest before hitting the streets, so to speak.

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Most business are going to run at a loss for at least some small initial period
Agreed. The key words here being some small initial period with the length of that period hinging on whether this is to be a primary or sole source of income.

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The suckers are always the last one to figure it out. The whole point of these techniques is that they work in influencing people. Keep in mind that the seminars, CDs etc all say the same thing (buy more of us!).
I agree and maybe I'm being too hard on people who don't see things the way I do. It could be a faith issue with this case the faith being placed in the tools blinding the recruit to the realities of operating a small home based business.
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Old 6th November 2009, 01:28 PM   #182
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Originally Posted by icerat View Post
Every single person in your county was already buying Amway products? Color me skeptical
*sigh* There is a finite number of people who won't just buy their soap at the store. Some people have brand loyalty to Tide, for example, and aren't interested in diversifying their shopping methods. However, I also had the problem of being in competition, over time, for new customers with other AMWAY distributors, and as I saw it, right quickly. A part time business on the side, out of the ome, gets finite time allocated to it. And, again, I was expecting to move.
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It's not a static market.
OK, I'll accept that.
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In fact one of the best markets for customers of Amway products is former distributors.
Nice job feeding Skeptic a set up line, icerat.
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Old 7th November 2009, 11:24 AM   #183
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Amway (UK)'s disclosure figures issued 2nd November 2009 -

"RETAIL CONSULTANTS
A Total number of Retail Consultants registered during the period = 9,777

This is the number of Retail Consultants registered with Amway as at 30 September 2009.

B Total number of Retail Consultants earning a Customer Volume Rebate (“CVR”) = 4,313

This is the number of Retail Consultants in Category A who earned a CVR at least once during the Specified Period.

C Average monthly CVR for Retail Consultants earning a CVR = £43 / €47

This is the total amount of CVR paid to Retail Consultants during the Specified Period divided by the number of payments.

D Highest total CVR earned by a Retail Consultant = £491 / €540

This is highest, individual, monthly CVR payment made to a Retail Consultant in the Specified Period.

E Lowest total CVR earned by a Retail Consultant = £11 / €12 *

This is lowest, individual, monthly CVR payment made to a Retail Consultant in the Specified Period.

* This excludes one time promotions given at Amway (UK) Limited’s new UK Flagship Experience Centre located in London.

CERTIFIED RETAIL CONSULTANTS
F Total number of Certified Retail Consultants registered during the Specified Period = 3,211

This is the number of Certified Retail Consultants registered with Amway as at 30 September 2009.

G Total number of Certified Retail Consultants earning a CVR or bonus income = 2,811

This is the number of Certified Retail Consultants in Category F who earned a CVR or bonus payment at least once during the Specified Period.

H Average income of Certified Retail Consultants earning a CVR or bonus = £126 / €139

This is the average monthly income of all registered Certified Retail Consultants during the Specified Period

I Highest total earnings by a Certified Retail Consultant = £4,350 / €4,785

This is highest, individual, monthly earnings of any Certified Retail Consultant during the Specified Period.

J Lowest total earnings by a Certified Retail Consultant = £4 / €4

This is lowest, individual, monthly earnings of any Certified Retail Consultant during the Specified Period.

BUSINESS CONSULTANTS
K Total number of Business Consultants during the Specified Period = 36

This is the number of Business Consultants registered with Amway as at 30 September 2009.

L Average income of Business Consultants during the Specified Period = £1,887 / €2,076

This is the average monthly income of Business Consultants registered with Amway.

M Total number of new Business Consultants qualifying as such during the Specified Period = 3

N Minimum income levels for qualification at Platinum, Emerald and Diamond Level:-

Platinum £7,000 €8,750

Emerald £15,000 €18,750

Diamond £50,000 €62,500

O Number of Business Consultants qualified at Platinum, Emerald and Diamond Level during the Specified Period:-

Platinum 93

Emerald 2

Diamond 1"

Please note that the figures relate to "Income" not to profit.

Steve
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Old 7th November 2009, 02:58 PM   #184
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H'm. Rather pathetic figures, aren't they? I guess nobody in Amway UK is doing it the right way.
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Old 7th November 2009, 04:03 PM   #185
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Can someone tell me the difference between the three categories, retail consultant, certified retail consultant and business consultant?

Here is icerat spruiking an Amway water filter in another thread without mentioning that it is an Amway product and that he is involved in the company. The discussion wasn't even about water filters.
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Old 7th November 2009, 06:22 PM   #186
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Originally Posted by Skeptic View Post
H'm. Rather pathetic figures, aren't they? I guess nobody in Amway UK is doing it the right way.
Yes and they scream only one thing. One thing in all caps, big fort and with several exclamation points behind it, hobby business.

Either that or they have their fingers in several other businesses as well.

I can't see anyone whose in the hundred pound a month range thinking that they're just a few tapes or a seminar away from that big house, Armani suits and a Porsche and if they are, they probably suffer from other delusions as well.

It looks like the business consultants are the ones making the real money but we have how many ? 95 ? In the whole UK? A quick glance tells me that of the 10K or so people involved with the company the chances of making it up to that level are pretty slim indeed. What do your figure those business consultants got in on the ground level, 20 years ago ?
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Old 7th November 2009, 10:50 PM   #187
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Originally Posted by Stout View Post

It looks like the business consultants are the ones making the real money but we have how many ? 95 ? In the whole UK? A quick glance tells me that of the 10K or so people involved with the company the chances of making it up to that level are pretty slim indeed. What do your figure those business consultants got in on the ground level, 20 years ago ?
Of the 96 there are 93 who are making about the same as they would be in an entry level job earning the National Minimum Wage (£232 for a 40 hour week).

As the tools scam is banned in the UK no doubt someone will be along to tell us that this proves that the tools are essential to the business. You can't sell properly without all the expensive "training aids".

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Old 8th November 2009, 12:23 AM   #188
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Originally Posted by oggiesnr View Post
Of the 96 there are 93 who are making about the same as they would be in an entry level job earning the National Minimum Wage (£232 for a 40 hour week).
But hey -- there are three whole people in the UK making more than minimum wage in Amway! And those three people have a 100% SUCCESS RATE!!!

Can't argue with that, can you?
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Old 8th November 2009, 07:48 AM   #189
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Ummm yes, 96 not 95 *cough* math was never my strong suit

As far as I can tell those figures were based on one month, not a year but I've got to admit I'm having trouble deciphering those stats. The only thing that's blatantly obvious about them is very few people are making the top monies.

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Please note that the figures relate to "Income" not to profit.
I wonder what this really means. Is this gross business with a significant percentage being knocked off for expenses like cost of product ? I'm just guessing, it is and without the figures detailing what those percentages are we have know way of knowing how much of those monies are actually being stuffed in pockets.

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As the tools scam is banned in the UK
Three cheers for the "nanny state"
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Old 8th November 2009, 10:50 AM   #190
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To be honest I'm still getting my head around the different UK levels too. Note however that "retail consultants" cannot sponsor - so all of that income is either just personal volume rebate or customer volume.

To become a Certified Retail Consultant, you have to have at least 5 registered customers with Amway - so in other words, these guys represent over 16,000 of those customers you claim are impossible to obtain. CRCs also need to complete an online test.

Business Consultants are roughly equivalent to the old "platinum" level, along with some other requirements to ensure profitability. A few years back some groups developed a business building strategy that got people qualified as Platinums, but they weren't making any money. The BC requirements were a way for Amway to discourage that.

The way the UK model works, everyone pays full retail price, and if you do a certain amount of volume you get your 25% "retail" margin back. This means folk who don't buy much or have no interesting in selling or sponsoring have no incentive to register just to get products cheaper, meaning the actual active "distributors" also have no incentive to register them and get to keep the retail profit.
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Old 8th November 2009, 11:07 AM   #191
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Originally Posted by Skeptic View Post
But hey -- there are three whole people in the UK making more than minimum wage in Amway! And those three people have a 100% SUCCESS RATE!!!

Can't argue with that, can you?
Very easy to argue with. You can't read.

36 Business Consultants

Average Business Consultant income (part-time) - £1855/mth or £22260

That's significantly higher than the median full-time income in the UK (£16400). Clearly the UK is in worse economic condition than anyone could believe, with, according to you, some 70% of the population earning less than minimum wage

As I was saying about being so blinded by bias ....

How there were only 36 BCs but 96 Platinums and above I'm not sure ... It would seem to indicate a lot of these folk who qualified for the "pin" but with a poor structure for actually making money, ie full support for the claims of people not building it "properly".
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Old 8th November 2009, 11:13 AM   #192
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Originally Posted by Stout View Post
I wonder what this really means. Is this gross business with a significant percentage being knocked off for expenses like cost of product ?
It's 25% retail margin back on purchases for personal use and sold to customers, plus volume rebates on personal and group volume, minus any rebates paid to the group.

So it's after cost of goods sold and any logistics expenses, but before any expenses like travel, home office.

Note that it also doesn't include any income from business that's generated outside the UK. The emeralds and diamond all have additional income from that, significantly in the case of the diamond, who I'm aware has Amway business in 18 countries.
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Old 8th November 2009, 11:28 AM   #193
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Originally Posted by Stout View Post
Three cheers for the "nanny state"
In fairness, it wasn't really "the state" per se. What happened was that BERR took Amway to court but didn't actually outline what the problem was (the court was quite scathing of them for this).

Amway of course couldn't afford to lose the case, so they pretty much brought a hammer down on everything that could possibly be an issue, including "tools" and told the court "see, we did all this to allay any concerns, and we'll keep them in place".

The court basically said "I would have found not guilty anyway, but since you offered, I'll accept the undertakings as part of the deal".

It's really quite stupid, as now meetings are back on pretty much as before, but instead of Network 21 running them, the platinum, Emerald, or Diamond does, ie more work, more expenses, less economy of scale. Books that used to be able to be bought in bulk for all of europe or even the globe, and thus sold cheaper to ABOs, now the ABOs have to buy from normal sources and pay more for.

ABOs are free to purchase CDs and seminar tickets, but now only from the "generic" public MLM trainers, which typically charge 3-5 times as much as they old systems.

What's more, a quality Amway-dedicated seminar is obviously a better option, so many ABOs now travel elsewhere in Europe to attend them, increasing expenses signficantly - though still often less than attending the generic seminars in the UK.

So people are not doing without these materials, they're now just having to pay more for them!

While some good things came out of it, the truly sad thing is that BERR was pushed into this not by folk in the UK, but by the likes of Eric Scheibler and the PSA/CAI scammers from the US. They couldn't get the FTC to do anything, so they've been targetting other countries. From what I understand, after preliminary investigations only BERR took the bait and of course lost both the case and appeal.
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Old 8th November 2009, 11:52 AM   #194
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Originally Posted by icerat View Post
Very easy to argue with. You can't read.

36 Business Consultants

Average Business Consultant income (part-time) - £1855/mth or £22260

That's significantly higher than the median full-time income in the UK (£16400).
You are, deliberately of course, confusing two different meanings of income. When we're talking about the median UK income, it includes the vast majority who have a a J-O-B income, which means the net income. At most, if what is meant is pre-tax income before (e.g.) fuel expenses, etc., we're speaking of keeping 60% or 70% of that as guaranteed as take-home money.

Amway income however, is income in a different sense: of how much the products were sold for before expenses -- that is, before considering how much the stuff was bought for in "wholesale prices". That alone would eat up at least 50%, more like 60%-70%, of this "income" -- and I do not even consider fuel, eating out, etc., etc., etc. If the real income -- the profit of the business -- is 20% of this reported income, I'll eat my hat.

But you know something? Fine, have it your way! Amway's numbers are so pathetic that even if you were correct, all it means is that instead of three success stories, we have 36. Out of ... er... about 10,000-13,000 people (depending if the 3,200 "certified retailed consultants" are also part of the 9,777 "retail consultants" or not.)

So what you are telling me is that instead of the 0.03% success rate we claimed it is, it's actually a 0.3% success rate. So it isn't that 99.97% of Amway reps in the UK are doing it wrong, only 99.7% of them.

Glad to have that cleared up.

Some "opportunity".
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Old 8th November 2009, 12:19 PM   #195
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Originally Posted by icerat View Post
In fairness, it wasn't really "the state" per se. What happened was that BERR took Amway to court but didn't actually outline what the problem was (the court was quite scathing of them for this).

Amway of course couldn't afford to lose the case, so they pretty much brought a hammer down on everything that could possibly be an issue, including "tools" and told the court "see, we did all this to allay any concerns, and we'll keep them in place".

The court basically said "I would have found not guilty anyway, but since you offered, I'll accept the undertakings as part of the deal".

It's really quite stupid, as now meetings are back on pretty much as before, but instead of Network 21 running them, the platinum, Emerald, or Diamond does, ie more work, more expenses, less economy of scale. Books that used to be able to be bought in bulk for all of europe or even the globe, and thus sold cheaper to ABOs, now the ABOs have to buy from normal sources and pay more for.

ABOs are free to purchase CDs and seminar tickets, but now only from the "generic" public MLM trainers, which typically charge 3-5 times as much as they old systems.

What's more, a quality Amway-dedicated seminar is obviously a better option, so many ABOs now travel elsewhere in Europe to attend them, increasing expenses signficantly - though still often less than attending the generic seminars in the UK.

So people are not doing without these materials, they're now just having to pay more for them!

While some good things came out of it, the truly sad thing is that BERR was pushed into this not by folk in the UK, but by the likes of Eric Scheibler and the PSA/CAI scammers from the US. They couldn't get the FTC to do anything, so they've been targetting other countries. From what I understand, after preliminary investigations only BERR took the bait and of course lost both the case and appeal.
You truly are the master of spin! What a unique interpretation of events you have there.
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Old 8th November 2009, 12:55 PM   #196
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Originally Posted by Skeptic View Post
You are, deliberately of course, confusing two different meanings of income. When we're talking about the median UK income, it includes the vast majority who have a a J-O-B income, which means the net income.
No it doesn't. It doesn't include travel expenses to get too and from work, education expenses, meal expenses etc etc. People with jobs have all these expenses too - but can't claim them on tax.

Quote:
Amway income however, is income in a different sense: of how much the products were sold for before expenses -- that is, before considering how much the stuff was bought for in "wholesale prices".
Please, read what I wrote. Nobody pays "wholesale prices" in the UK.

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That alone would eat up at least 50%, more like 60%-70%, of this "income"
I have no idea what you're talking about. I suspect because you have no idea what you're talking about.

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-- and I do not even consider fuel, eating out, etc., etc., etc. If the real income -- the profit of the business -- is 20% of this reported income, I'll eat my hat.
I hope it's tasty. No, come to think of it, no I don't.

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But you know something? Fine, have it your way! Amway's numbers are so pathetic that even if you were correct, all it means is that instead of three success stories, we have 36. Out of ... er... about 10,000-13,000 people (depending if the 3,200 "certified retailed consultants" are also part of the 9,777 "retail consultants" or not.)
No, what's pathetic is you complaining that people who are doing nothing at all deserve to earn an income! Are you a hardcore Marxist? That might explain some things.

Quote:
So what you are telling me is that instead of the 0.03% success rate we claimed it is, it's actually a 0.3% success rate. So it isn't that 99.97% of Amway reps in the UK are doing it wrong, only 99.7% of them.
Not just a marxist, and arrogant marxist! Someone who registers because they buy lots of products and wants to get a discount - Lord Skeptic declares you're doing it wrong!

Someone who registers to service a handful of customers for a few hours a month and an extra £100 - Lord Skeptic declares you're doing it wrong!

Someone who registers to build a profitable business, which will generally take at least 1-2 years, and has only been in a few weeks or months, so no reasonable person, least of all them, would think they'd be making money - Lord Skeptic declares you're doing it wrong!

Quote:
Glad to have that cleared up.
With respect, all we've cleared up is your ignorance and arrogance. You completely ignored what I wrote about the bonuses, you haven't bothered reading the Amway UK website to know what they mean, you arrogantly decide that thousands of other people are "failures" and don't know what they're doing because they're not achieving some arbitrary goal that you define without any regard for what they want. What's more, even for those wanting to achieve a significant income, you declare them failures less than a year into the venture when they may very well be exceeding their own expectations!
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Old 8th November 2009, 12:56 PM   #197
icerat
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Originally Posted by NewtonTrino View Post
You truly are the master of spin! What a unique interpretation of events you have there.
None of that required "interpretation", it's all a matter of record.
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Old 8th November 2009, 01:27 PM   #198
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No, I'm actually a capitalist. A capitalist thinks in dollars and cents (or, in this case, pounds and pence, or perhaps Euros...) He sees a "business opportunity" where 99%+ make practically no money, so he thinks it stinks.

He is not convinced by words -- by the "threat" that some fool who isn't actually making a dime in the "great opportunity" will call him a "Marxist" for not joining up. What matters is whether the investment makes sense. It doesn't. So the capitalist goes and invests his time and money somewhere with a higher return.

That's not hard -- apart from literally throwing one's money out the window, it's hard to think of an "business opportunity" that is worse than Amway (or any other MLM). Lousy business opportunities are a dime a dozen, but it takes some sort of special talent to create a "business opportunity" that is that bad, where over 99% make no money worth mentioning.

Heck, going to Monte Carlo and betting all of one's money on 13 is a better opportunity -- the chance of success is about 3%, or somewhere between 10 and 100 times better than in Amway, depending on what level one defines "success".
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Old 8th November 2009, 01:36 PM   #199
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No, what's pathetic is you complaining that people who are doing nothing at all deserve to earn an income!
So 99.7% of Amway UK are not doing anything to earn an income?

Heck, Ivory soap used to have an advertisement, "99.44% pure soap". Amway UK has them beat -- their ad should be, "99.70% pure lazy losers doing nothing to earn an income".

When you've got a higher concentration of losers than Ivory soap has concentration of soap, I think that's telling you something.
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Old 8th November 2009, 02:12 PM   #200
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The Business Consultant income is an average across the whole group of 96 and yes it does average a reasonable wage (assuming no expenses) but the diamond and the two emeralds skew those figures so the actual earnings of most will be lower, it would be interesting to see the median figure which might give a truer picture.

As I read it, over half of the Retail Consultants didn't sell enough to gain a volumne rebate and made no money even before any costs.

The CVCs did a bit better but still (on average and I'd like to see the median figure) earnt very little.

That accounts for most of them.

I assume that the Diamond is raking off their percentage and sits at the top of the UK pyramid.

Also note that the number of Diamonds has not increased in the last year.

As far as making money is concerned. At the bottom end of any small business, selling product to the public (ie not manufacturing or innovating) I would expect to see a working profit (ie one that allows a wage and reinvestment) almost immediately but then I'm a market trader (as in market squares) so the world I inhabit is one of buying, setting my price and selling or I don't eat. The 25% gross margin on Amway(UK) is much less than I would expect from a viable small trading business.

Steve

PS Icerat - please expand on the comment that no-one in the UK pays wholesale, is this for Amway or a general comment?
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