FOR THOSE INVOLVED WITH AMWAY - MUST READ!

[Dave A]

Please be so bold as to mention your MLM by name as you've done with AMWAY. This will allow readers to do research and enquiries, and judge for themselves.

Success alliance was introduced here.

[MikeC]

Re: Amway and MLM

I joined an IBO in Amway 10 years ago and found that there was not much experience around at that time. Many people that were unfocussed (As I was) were unsuccesful in the business. I joined up with another IBO recently and found that this time around there was some good leadership in place. I have not had much experience of other MLM's but I find that the people involved with N21 are a very positive group of people with some excellent leadership as well as people skills. I believe that if you join a network marketing company you need to ensure that you are joining a good "leader" and a fast growing group. You need to be able to relate to the people that you are joining. You also need to join a company that has the right sort of ethics and has been around for a long time. There is a common misconception in that you are joining Amway. This is not true as you are joining an existing team of people associated to Amway. I have found that in the last few months we have been able to grow a profitable business through the N21 system. My people skills and leadership skills have grown dramatically. This would not have happened in my conventional business unless I had attend many seminars which would probably have cost thousands. I am with a fantastic group of people and beleiev that it is the best decision I have ever made.

[harvey999]

To Whom It May Concern,

As I understand, Amway I thriving in South Africa at the moment. Therefore, I believe the following information will be of interest to many people...

Presumably you (or someone you know) joined Amway to make money. Yet by now you will probably realise that MLM can be exhausting and the rewards may not be permanent. You may even be wondering if MLM will really deliver for you (after reviewing your results and those of people around you - especially your downline).

Well let me assure you that MLM works and with smarter systems and a better marketing plan, you do not have to utilise exhausting ways of operating.

I am involved in a part time multilevel franchise that can generate AUD$100,000 per year for you within the next 12 to 24 months (its been done). However, to do that you only have to work about 10 to 15 hours per week and you do not have to go out at night.

Attractive elements include:
- The PV to dollar ratio is almost 1:1
- Promotions are determined by cumulative group volume (no dropping back to zero at the start of a month)
- Promotions are permanent (you never drop back once a level is achieved)
- A 20% level is achieved after only $8000 cumulative group volume with only $2000 side volume a month (and your first bonus level is 10%, achieved after a $150 purchase)
- The qualifying $2000 side volume reduces to $500 at higher levels
- 5% breakaway bonuses up to 5 levels deep (sometimes more), affinity bonuses up to 8% (to infinite depth), and up to 21% on your first level distributors
- 56 cents in the wholesale dollar is returned to distributors (including a car bonus).

I invite you to compare these particulars with your company. I encourage you to look critically at the figures.

Numerous people from other multilevel organisations, including some senior pin levels, have seen the advantages and now make very generous incomes in an easier and more enjoyable way.

Amway (or its associated regional companies) have been publicly listed. During that time, they were required to disclose, in their annual reports, the remuneration paid to its distributors. I understand that the last published figure for what Amway paid to its distributor force was about 26%. There is some ambiguity about this, but my research would indicate it to be about 26% (it may be a little more or a little less).

As you would know, Amway has a 'breakaway' marketing plan. Anyone with experience in MLM will tell you that there is relatively little money made in the pre-breakaway section of the plan (that is, up to 21%). The majority of income is made after you break-away 'directs'. Based on the figure of 26% mentioned above, after paying the 21% (pre-breakaway), only 5% is left.

Of that five percent, 4% goes to payment on your frontline qualifying direct (if you manage to reach the appropriate side-volume to qualify - and as you know - that is difficult in itself). Amway only pays the 4% bonus on one level of breakaways. Simple arithmetic shows therefore that this leaves only 1% to pay you for all the rest of your breakaway groups. These bonuses are various but it should be noted that very few distributors ever get paid these extra bonuses - usually only those at levels well above direct.

My company pays 56% to its distributors. After subtracting the 20% that is paid on the pre-breakaway section of the plan (the equivalent of your 21%), there is 36% left for paying you on your breakaway groups - which, as we know, is where the real money is made.

So, after paying 5% (my company pays 5%, not 4%, for breakaway groups) on the first level group, my company has 31% (compared with your 1%) to pay for the rest of the breakaway groups.

My company pays 5% up to 5 levels deep (more with "compression") plus it pays an affinity bonus up to an infinite number of levels in depth. Naturally you have to qualify appropriately for these. Moreover, in addition to the breakaway part of the marketing plan, my company has a Unilevel section to reward new distributors in the early stage. Not surprisingly, we have increased satisfaction and an excellent retention rate.

About 30% of distributors in my company go to the executive level (that is, the breakaway level). This amazingly high percentage is accomplished because of the cumulative volumes and the fact that you do not drop back to zero every new month. Please don't forget that you can be paid up to unlimited depth on these high numbers of breakaway executives (including to 5 levels with leadership bonuses, compression overrides, and an infinity bonus at senior levels). It might be worth asking how many actually reach and hold the breakaway level in your company - you might discover that as few as 0.5% (or less) of distributors go "direct" and hold that level.

I think you can clearly see the enormous difference between the two companies. If you would like more information about the differences and possibilities, please contact me. I will guarantee confidentiality and I sincerely feel that it would be worth your while.

You know better than most that sometimes, if you want to make a change in your life, then you need to make a change in your life. This could be the time.

If you are genuinely interested in really making $100,000 a year within a few years in return for 5 to 15 hours a week, I invite you to contact me for more information (confidentiality assured). Incidentally, you would be welcome to verify these dollar figures from freely available written records of payments.

Kind Regards,

Aussie

and become one of your "downliners"? ha ha!

[Rob Hepple]

So many new MLM's come and go. They all promise the best payment plans. Some stick around for a few years and then slowly fade into obscurity. Most just disappear. The magic in building the Amway business is not Amway the company or Amway the products. Those are great ,as they've proved over the last 51years. Quality always wins, hands down. The magic is Network 21. As with any business, you need to be educated on how to build a solid, ever lasting network. A number of years ago N21 was voted by Harvard business school as the best adult business education system. N21 is also the best business mentorship program around. That's my opinion and I challenge anyone to prove it wrong.

[Dave A]

I think the problem is most new MLM schemes don't survive the die-back once the "new" factor has worn off.

For whatever reason, people seem to chase the "new thing." And I've seen more than enough launches where that's the only message - We're the new thing.

Trouble is it doesn't duplicate well after a while.

[ABCAB]

When it comes to MLM's you really want a company that has been around the block. I think 50 years in the business takes Amway out of the fly be night category. Along with NW21 it has become the company that has produced the most millionaires world wide.

[Keen Observer]

Hi Aussie please send me more info.
Thanks

[Dave A]

Last I heard Aussie was out of this business he was promoting. I doubt any information will be forthcoming.

[MLMindustryleader]

Aussie, you must be fairly new to the industry. Pay plan comparisons are a total waste of time as you are assuming that all things are equal, i.e., that your product would sell as easily as others, in the same time span, in the same volumes, etc. Second, you can make numbers and percentages do anything you want to on a piece of paper! It's been said numbers and percentages are like hookers-once you get them down you can do anything you want with them. Finally, over the last 10 years the majority of companies that have had the greatest growth, the most success, and where the biggest incomes have been earned, those companies have 3 common denominators-they are health and wellness companies, they have a limited number of products, and they have a binary plan with matching bonuses. If you were looking to increase your chances for success and maximize your income earning potential, you would look for a company that has those 3 characteristics and which is at least 3-5 years as 99% of ALL new MLM companies will fail in the first 2-3 years. Historically, companies with binary plans have experienced the greatest growth and created the biggest checks in the shortest period of time. In addition, binary plans generally pay out more money to the field as they have a "fixed payout," typically 50%, whereas unilevel and stairstep breakaway plans, which are theoretical payouts with some claiming to pay out 55-60-70%, actually pay out from the low 30% range in the case of Amway to the high 30 and low 40% range as a result of "breakage" which is due to the fact that 98% of the people don't meet the qualifications to earn maximum income. Finally, the pay plan is not the deciding factor in whether to take advantage of a particular opportunity. There are far more important variables to look at-the pay plan, the products, and the company in fact are secondary factors, not primary factors in the decision making process.

Regarding Amway, which is the second largest direct selling/network marketing company in the world (Avon is #1), several comments: First, they were not the first direct selling/network marketing company. Second, Amway's pay plan has one of the lowest payouts in the MLM industry (32% which was stated on their corporate site the last time I looked) so the comment made by jvdwalt that if you want to make money, join Amway is hilarious in lieu of the facts.

[Dave A]

In addition, binary plans generally pay out more money to the field as they have a "fixed payout," typically 50%, whereas unilevel and stairstep breakaway plans, which are theoretical payouts with some claiming to pay out 55-60-70%, actually pay out from the low 30% range in the case of Amway to the high 30 and low 40% range as a result of "breakage" which is due to the fact that 98% of the people don't meet the qualifications to earn maximum income.

Hold on a moment. Surely binaries have an even higher probability of "breakage" and less-than-theoretical-maximum payout than a gross volume breakaway plan like Amway's?

[Scripto]

Hi Aussie,
Googling the company after just attending a 1st presentation, had me sign up here when reading your post. Since it's 5 years back, I hope you're still linked & can respond with any updates on your vast analysis given at that time.Being a complete novice but with a general understanding of accounting principles using %'s yet slightly confused with terms such as 'breakaway & affinity bonuses', 'side volumes' & some general jargon, would appreciate some simplicity if possible.
And is there any change with your assessment on the MLM company, over the past years now? I'm expected to goto my 1st BBS (product description) meeting tonight and signup for a number if satisfied. Thanks for a great breakdown.