Amway Class Action Lawsuit Settlement
I have a business opportunity for you. For the most part, you’ll be a salesman. You’ll sell overpriced, mediocre products to your friends and co-workers, people already in your trust network, with whom you can use their guilt and their desire to maintain happy relationships.
The truth is the products don’t matter. It can be jewelery, kitchen tools, or beauty products. What you’ll really be selling is the system, because you earn money when those you recruit to the system earn money. The scheme itself earns money by selling the tools that allow you to participate, but participants earn money by recruiting. While using guilt to sell products to your friends and co-workers, it’s much more difficult to convince people to become sellers — especially when there are start-up costs to contend with. As a result, almost all who participate in pyramid schemes never earn a profit.
Amway, a pyramid (multi-level marketing) system that fits this description, has recently agreed to settle a class action lawsuit by paying $55 million to members who lost their own money through this particular business opportunity. Two important points were raised in the lawsuit:
- Amway (which now goes by the name Quixtar) offered a “typical income” from its program in its marketing materials, but this income measurement was the mean, which means it is skewed by the few big earners at the top.
- The company used gross income in its figured, not profit, and by not making that clear, misled recruits into believing they would earn more than they did.
Part of me wants to fault recruits for allowing themselves to become victim, but I understand that the quest for income can be desperate sometimes, and it’s worthwhile to consider every opportunity. Slick marketing materials help mask the truth. While some research is all it takes to avoid these programs, but cognitive bias plays a role, too.
It bothers me that multi-level marketing schemes have become such a force on the internet, as well. Rather than hard items, the products are digital, like e-books. Customers are asked to recruit other customers and paid to do so. The product is irrelevant because the income opportunity is in the recruiting. If you read between the lines when your friend offers you an “opportunity” and see there’s more money to be made by convincing your friends to be part of your team than there is substance to the product, then turn around and walk away.
And tell your friend to stop trying to make money off you.
Hat tip: @EverydayFinance
Article comments
If there was a way or if someone was to develop a way for people to buy amazon products and have a setup like the Amway bonus tier it would work because the price is right and it would open the door to thousands of products sold and not overpriced
People like Brad, Joe and Josh our of the Seattle area are notorious for misleading and misrepresenting Amway and Worldwide! Keep your money and stay as far away from these people! They will love you as long as you blindingly follow but the minute you hesitate they will turn on you like a rabid dog!!! I was burnt and bitten by them costing me over half a million while they fly in their private jets telling you about a “business opportunity “ to pas their pockets! Stay away!!!!
I’m an IBO too and I’ve been discouraged many times by listening to people at which I don’t know what to believe because I worked so hard to get to where I am. It is nobody’s business how much money I make. I know that if you work hard, it pays off. I’m not counting numbers but productively. I like Amway because maybe I like their products. Maybe because it is fun to show the products to people. I love the products because of their beneficial and value. Yes, it sucks they are expensive but they are made in America. Who honestly says US products are worse than Chinese products? I’ve never heard the exact opposite of what I was told years ago. Walmart sells cheap breakable products like steak knives. CUTCO is a much better American brand because of it’s value, strength and design. It is expensive for many reasons. The problem is affording them and that’s why I struggled so hard in it and failed to sell a lot. It could be the same with Amway and I’m not making enough profit. But does it REALLY matter at all? Does it matter if I fail or succeed? I call it doing something. Amway is definitely not to be taken as a career unless you are REALLY good at it and indeed are selling like hotcakes. It is not a very reliable job. It is not for everyone. It’s more like a side job to earn extra cash until you build a bigger cooperate team who do the same thing you do. I like selling the products more than sponsoring people because they get mixed opinions and I really don’t want to go through with that. I’d feel bad scamming people but you don’t have to be sponsored to do what you do. You can buy the stuff yourself at cheaper price if you want to. You can sell too. I’m extremely lucky to have a good income job at least. But I keep both CUTCO and AMWAY because I like their products. I ignore the negative comments because they are opinions. No one is right about EVERYTHING or that makes them non-human! That’s right, I was accused as a monster for selling products were claimed as killing people. I don’t believe how hurtful that remark was given to me but I almost cried for something so inexcusable. If people justify us as monsters, they are no better than being a no-it-all jerk face. I witnessed it personally. ~_~
You guys waste too much time arguing on all kinds of nonsensicle topics here.. Take a break and go do something better.. People who believe in building the business should not worry about debating here with people who do not believe in the business. No matter what business you are in, you need to have an authority and need not spend time explaining things the way you look at to people who are never going to believe.. Just my thought, nothing to do with any mlm’s or job goers. I am a business man and believe that no matter what you do in life, always have a plan b up and working.. Never know when you would need it.. Dig your wells way before you get thirsty.. God bless you all.. Take back your individual believes and live your life the way you choose to live..
Zzzzzzzz can someone please wake me up when something interesting pops up. Cheers 🙂
What do you mean by “the actual wholesale is less than 33.00?”
Thanks Tex
My point about the worker bee is that Amway tells everyone they can ALL make it to queen bee. I agree that it is possible but they leave out the fact that MOST ibos do not make it. Or that without a TON of worker bees feeding the Amway machine it CAN NOT WORK. It literally ONLY works if there are TONS AND TONS of worker bees believing they will all make it. If they all make it, it wont work. If they dont believe they will make it, they quit and then it all falls apart for the upline.
Amway gets people excited to achieve their dreams, convincing everyone they can become Millionairs. Amway KNOWS most will fail. They have to fail. In order for there to be Diamonds there must be Emeralds under them and then Rubys under and then worker bees (lots of them) under them. If the worker bees go away then the Emeralds go away and the Rubys then Diamonds etc… So I am saying this system ONLY works with TONS AND TONS of worker bees under the others. It simply can not work if everyone “makes it”. CANT HAPPEN – why is that so hard to see? It only works if most DONT MAKE IT. They NEED people paying retail for this stuff, or at least “fake wholesale”.
They should spend less time teaching to quit your job and put your dream (boat / mansion) picture on your fridge and more time teaching the truth. Want a mansion, you need 2 things, hard work and customer service but tricking people isnt the best way.
They teach that Amway is the easy way to achieve your dreams. If these ibos spent the same effort building a business of their own they would get further faster and would likely take care of their own families better than feeding the Amway machine. As an ibo (worker bee) you are taking care of someones family… probably the Diamond in your upline. I bet your kids could use that money more than the Diamonds… Your chances at ever making diamond are closely equal to winning the lottery.
Yes I get that if everyone buys off of Ebay there will be no more avail on Ebay. I made sure to order plenty before I posted LOL. At any rate there are IBOs out there buying double X cheap enough to sell it on Ebay for 33.00 per box. You do know they are paying Amway less than 33.00 per box?
If I were an IBO I would buy all my double x vitamens off of Ebay so that I could make an extra 13.00 cash now and invest that into my own IRA etc.. Why give AMWAY an extra 13.00 of your money to purchase from them at 46.00 wholesale when you can get it cheaper RIGHT NOW on ebay? Just so you qualify for the correct PV/BV and receive a $2.00 check? You can make 13.00 right now – go to ebay… lol
OH and I have been buying Double X for 3 years on ebay. Its always there and it always costs around 33.00 per box. That should tell you that the actual wholesale is probably lower than 33.00. So as an IBO getting it “from yourself” in “your own store” at 46.00 is a shitty deal compared to getting it from Ebay at 33.00.
Hey all you IBOs, you can buy Double x from me for 40.00 per box. This will save you 6.00 per box from ordering if from yourself. (Dont tell anyone but I am going to go buy it for 33.00 on Ebay and profit 7.00 per box from you) I promise I have a mansion before any of the people buying it from them selves at 46.00. If you are more comfortable getting a check back so you feel like you are making money please just let me know and I will charge you the full 46.00 and mail a check for 6.00 back to you with your Double X order. That is more than AMWAY will do for you, seriously they dont care.
In a interview with Donald Trump on the tonight show was asked if he had to rebuild his wealth from scratch what would he do?
He said he would start a network marketing business.
The crowd booed him and he stood up and said that’s exactly why your sitting where you are and im up here. 🙂
You idiots saying Amway is s pyramid don’t know what you saying and need to open a dictionary.
Pyramids are illegal and Amway has been in business since 1959 and are working with many small businesses you dummies never heard about like Apple!
They have been looked at and studied by the FTC Federal Trade Commision and have said that Amway is not a illegal pyramid.
Amway has a A+ Rating from the BBB.
So I guess you basement bloggers know something the BBB, Apple and the FTC overlooked.
The definition of a illegal pyramid is the guy at the bottom cannot make as much money as the guy on the top.
So how is it at your Job? Do you make more money than your boss?
The world is divided in 3rds:
1/3 are asses 1/3 are complacent and 1/3 WANT TO WIN!!!
So figure out what category you fall in and shut up and stand aside for the people who want to do something great with there lives!
Only 1% of Americans fall into the win category so I’m not surprised by all the dumb lazy excuse makers on here blogging from there parents basement on food stamps!
Overall, I agree with your comment. However, there are factors which make your post somewhat nonsensical. First of all, you ignore the time factor. A “worker bee” today could become a “queen bee” in a few years, and there is enough change in the marketplace which makes the supply of new IBOs virtually limitless, such as people becoming eligible by age, circumstances, etc. Also, if every IBO bought Double X on eBay, the price would go up, simple Econ 101 supply/demand in action.
However, your point about the ATS (Amway Tool Scam, click on the flag for more details) is right on target, and by far the biggest problem Amway has in the U.S.
Amway is my lover. I want to be Amway. I do not believe that I am tricking or lying to people. I really do believe EVERY member of Amway can be trillionairs. I will now pretend not to understand how its supposed to work – what I mean is that we can all be the promised queen bee and every worker bee can turn into a queen bee and there will be no need for worker bees anymore. Freedom… flush that stinkin job!!! I’m just saying ALL OF US will be trillionairs and we will no longer need worker bees.
(WARNING: if there are no worker bees the queen bees will die)
Nope you wont be able to push your retarded brainwashing bs on the rest of us who can see this scam for what it is. Everyone CAN NOT become rich…. IT WONT WORK – you have to have the little (poor sad broke gullible) people willing to shell out money to make only some people rich. For all you who believe you will make it… bookmark this site and come back in 5 years… Probably BROKE and sad and then remember we warned you. Dont kill yourself, alot of people believed their BS too, you are not alone. The sooner you walk away, the sooner you go a different direction the better off you will be. Stop the lies. And to all you people who have a picture of ANY MATERIAL POSSESSION on your fridge – Grow up Peter Pan that isnt what life is all about. You should remove that from your fridge RIGHT NOW or suffer the consequences associated with Materialism. Mark my words… you will NEVER have enough EVER. You are being decieved. This “dream” is simply the method to keep you pouring money into the System that keeps only a few well off. Its a trick. Dont believe me, take a trip to Amway and demand answers to all your questions about why you dont have the trillions they say you will make – they will tell you “its coming” simply to… you guessed it – keep you pouring money into the system that keeps only a few well off. It truely is a trick.
Here is a test. Go to Ebay.com and search for double x vitamens and see how you can buy them for 33.00 (ish) for a 1 month supply. Also note that the expiration date is 2013 or later – they are legit / sealed boxes.
Now go to your upline and ask them if you should buy those vitamens for 33.00 or if you should pay wholesale 46.00 to them or retail 70.00.
The average working Joe would say the 33.00 is the smart buy. (so would I)
The upline will say the 46.00 is the answer because you are “buying them from your own store” – nevermind its more than ebay. You will NOT recieve ANY money back on that 46.00 purchase. This is not someone looking out for you or your family – they are looking out for their PV/BV – they dont care about you period.
Wouldnt it be better to save the 13.00 and deposit that saved money straight into an account? I had an IBO tell me it would be better to understand the process of building your business so you can be financially free by spending more money now than you have to.
This doesnt make any sense whatsoever. Stop. Think. Then just research the potential truths in this response. If something is too good to be true, it is. Simple.
Now if you are a kick ass salesman and have the ability to produce tapes and materials to sell CDs etc.. You will be a rockstar if you do it right and the rest of these loyal Amwayites will buy you a new mansion, cars, boats, planes etc… Go nuts and work these idiot followers over for their last dollar, make them so broke and DESTITUTE that they commit suicide – all for the sake of your MONEY. Hmm that seems kinda shitty to do too, doesnt it? Whatever.
It only goes back to 2003.
Does anyone know how to claim money from this settlement? I lost about $10,000 between 1996 and 2000 when my father-in-law pushed me into this…by the time I got out, the money was gone…nobody from the upline wanted any of the books or training tapes back….
Organized crime is illegal but they are still around after more than 50 years.
Pyramid Scheme????? I have never known a pyramid scheme can survive 50 years, operate in 80 difference countries and have a AAA+ credit rating on the Forex. I am enjoying my business that I have and to tell you the truth I run my business the way I want and Amway is Only my preferred product supplier. I get educated by N21 (which for a matter of fact is endorsed by Robert Kiyosaki & Donald Trump) and I have already plugged in an existing team. I have been in the business for almost a year and I have qualified and have seen results. You are building a business, you are not a salesman as most ppl claim above. Yeah selling does help to push up your PV but its the ppl that you help in the business that grows you income.
Things have changed and most ppl are still stuck on the Idea when Amway first started, its the 21st century ppl, things have been tried, tested and perfected over the years. Its a team effort now and not a single effort anymore.
Happy to be part of the Amway Corporation.
Dear Name-Dropper,
Bernie Madoff had a great name too at one point in time; revered by his peers, just like D. Trump and Kiyosaki, ask yourself this, is either Mr. Trump or Kiyosaki actually in the Amway distributorship?
Please provide some proof of this, I am unsure and entirely fascinated.
Happy to be a hard working provider for my family, earning just a little more than the average distributors income of a whopping $1500 annually. 😉
this is simply my experience. many years ago i got involved with a company — a different one — that actually DID have great products, but i followed too many of their instructions and thought a few thousand in debt to start out was the only way to start the business “right”. of course it didn’t end there. i was told i wasn’t presenting myself well enough and needed to wear better professional clothing. and some other things (quitting the day job that was ‘in the way’, becoming a robbery victim at one point when *all* my [locked up] inventory i went into original debt for was stolen from the company office, etc etc). i am kind of embarassed about the whole thing since it (my bad decisions were enough to) actually began a nasty spiral into unsecured debt that took me years to dig out of. at the height of debt, i owed about $35k total which was completely crushing for me. it took me yrs to dig out, but finding a debt reduction counselor and instituting incredible self discipline & control helped make it possible to then pay off in a handful of years (which felt like a long decade). (i feel lucky, the counselor was a good one, and even though there were buyouts, they did negotiate down my percentage rates and i did get great advice from the original counselor. also, i became incredibly motivated — which turned out to be essential. i realize this as i watch a friend struggle with debt badly, less debt than i had, but she has no motivation nor discipline to really conquer it it seems.) i personally knew others whom had gotten involved with the same company and ended up choosing to declare bankruptcy (for debt amounts that were less than mine). i never considered doing that for many reasons. most of all, to me (& for me), it just felt wrong to do.
i remember when i noticed somewhere a big class action lawsuit was being brought against that unnamed company around the time when i was seeing a big bright light at the end of my debt tunnel and had moved away. i remember reading all the details and finding it very interesting. i didn’t even consider jumping on the class action bandwagon because although i pretty much agreed with and felt the details showed the suit may have had merit (and felt it described rather well what *i* experienced with that company), i still felt/feel my bad experience with it was ultimately really my own fault. it’s one thing i still kind of regret. the debt made me feel less free and also be less free which affected how i had to make decisions in my still fairly young life. i try to remind myself it was a ‘cheap’ education and also that whatever happened then helped lead me to here and i should just be thankful. (=
(after all, i DID end up getting a much higher paying job after i left the company — several thousand more per year compared to the job i had before it. perhaps from a few skills learned and also a deep imperative within myself for lack of a better way to put it since i can’t easily put it into words having just brought all this up since reading flexo’s post today… of course that aided in my debt payments.)
I love how the trolls come out whenever an article’s posted on their company. They clearly aren’t RSS followers since this article’s a few days old, so it’s the old troll maneuver – look for keyword alerts from google for your scammy company and then go on and talk about making 6 figures. The real “figures” don’t lie – for all MLMs. The vast majority of people end up losing money/wasting time. There are some real high paid hookers, drug dealers and sports stars – but most people trying to make it to the big show fail. And look stupid doing it.
Trolls?? Wow….. I’m no longer human because of a forum… wow….
Years ago, I used to work part time in a Speedway gas station C-store in Grand Rapids MI — Amway people were in there *every* *single* *day* to try to enlist me into the system. Can you imagine – going after convenience store clerks as a means of making money?! They’d always start out with something like “How would you like to be making 10 times what your getting now?” or some such drivel.
maybe you should have listened. its a lot more profitable that working at a gas station smart guy.
Goner made a good decision. Chances are he would have been ripped off via the Amway Tool Scam. Click on my Texas flag for the details.
A few years back I got involved with a multi-level company called Primerica. The gist of the business was personalized financial services. We would meet up with people, go over their mortgage, insurance, and retirement savings, and see how we could restructure their cash flow to put them in a better position. Main reason it worked is because most people had whole-life insurance, which costs more and invests in very low interest funds, while we moved people to term insurance and told them to invest the difference in our mutual funds or use it to pay down mortgage. Granted, the insurance we sold was overpriced, the mortgages we refinanced were not at the best available rates, and the investment funds had high fees – all things I found out after dropping the business – but almost every family we came across would be better off with our products than what they had at the time, and almost always without having to spend any more than they already do. Mostly a testament to great marketing skills of other companies I guess. Although I did make a little bit of money, sales wasn’t my thing and selling these products was hard, since people are very skeptical and protective of their financial information. As I said, after dropping the business and learning more about it, I found out it does still rip people off, just not as badly as someone else has done previously. One major benefit of doing the business, though, is learning all the financial tricks myself, and that business was the main reason I ended up switching my careers from IT to business financial analyst/accountant. So, yeah, most pyramid type businesses are scams, and almost all of them rip you off, but not all of them are all bad (they just rip you off less than the last guy)
Dude- subscribe to Achieve magazine and you will see hundreds monthly if not thousands annually, who are making at least 60k-80k per year.
A “ruby” in the Amway business with proper parameters earns 125k approximately as an average now- when the average salesman outearns his boss, either that guy becomes the boss or the salesman ‘s quota doubles, or territory is divided in two , or accounts are split up. Get real.
Corporations pay you just enough to keep you boiling in their kettle- that’s why they are called JOBs- stands for Just Over Broke!!!
Amway keeps marriages together as well, by getting the husband and wife to work together, instead of promoting separate travel and long hours away from family.
When you look at the average corporate pension offering today, one begins to see that the real pyramids are the corporations- where C-level execs get golden parachutes and the average ” worker bees” are let go when their years of service start to hit the 20’s. The average 401k has become a 201k in this economy!
We are being lied to by the corporations, not Amway!
Wow, that’s almost a copy-paste of the standard sales pitch!
Yo face is a sales pitch!!!!! Oh burn!!!!! I’m done playing with you guys who don’t know the truth about this amazing company, Amway! I hope you have a good life as I help hundreds and eventually thousands have great lives through this wonderful opportunity. Veronica I’ll see you on the beaches of the world, free from the bondage of a job!!
Classy response, classy company. Anyone out there who equates internal marketing materials as “truth,” makes it apparent how they’ve become an “IBO:” they’ll believe anything.
Bottom line is, even if you are making lots of money, if you’re doing it by selling overpriced crap to gullible consumers, you’re still making lots of money by scamming other people. Also, if your overall company is forced to shut down due to these practices, you may suddenly find yourself on the beach with no income.
of course they believe in what they do as a IBO and say what they say. the question is do you believe in what you do? my year end bonus was $150,000.00 and i’ve been financially independent since i was 28. I get to spend everyday with my family and especially my 7 year old son. I’m super glad and proud I’m a IBO.
anthony,
How much money do you make from Amway, and how much from the tools?
It sounds like you all are mad at the training organizations making money off tools, more then Amway. Amway cut their prices last year to compete in the market place, and now are the same or cheaper then wal-mart and target at retail. So it is no longer “over priced” as you all claim.
Fred,
It’s a partnership. Amway benefits because they can keep higher prices and more of the profit. Amway lowered the prices last year, and raised them this year. Amway didn’t lower the prices that much, and they also lowered the BV, which is understandable, and the PV, which is not. If you have some specific FACTS to refute this, bring it on.
LMAO… yeah, the beaches, I know, when you get there please post a photo of the two of you there! I WILL drink to that, having read this blog I see two types of people, sheep & individuals, nothing wrong with a JOB… at least it pays 😉
I will also toast the day Quixtar gets annihilated by a tobacco or Worldcom sized class action and once and for all shuts the lot of you up. Including your deluded leaders, with pending deals with Enron in the loop (Rich DeVos) and Worldcom, although all your so-called business partners (of which are merely service contracts) will laugh and run (with their pockets well taken care of) at the sight of a decent case, just like Citibank and many others did when Enron sunk.
As for time (52 years) – well pyramid schemes were legal for a LOT longer, (estimated over 100 years) but hey, you guys enjoy the beaches, have a cold one for us JOB plebs, what would we know?
This is what we know, one day, there WILL be a knock on the door and it won’t be one of your ditto deliveries, it will be the authorities.
A good rating from the better business bureau doesn’t mean Amway is a good opportunity. It just means that Amway handles their complaints satisfactorily. Care to point out where you got the information that “thousands” of people are financially free because of the Amway opportunity? Thought not. even if some people make money in Amway, millions upons millions lost money. You could promote Amway the same as a lottery. Many will lose so a few can win.
You can’t lose money doing Amway. The only thing you pay for is the membership just like you would to buy wholesale from Sams Club or Costco. Same thing. And I get the print out of hundreds of people hitting the 50k plus more a year every couple of months. So after 52 years of being around yes it is thousands. You do the work it pays you, if you join and don’t do anything then of course you don’t get paid anything. Oh yeah, just like any other business works out there…. Amazing!
Fred
You do lose money. I am personally out $200+, luckily I stopped when I realized that men walking up my driveway in suits like (no offense) Jevovah Witnesses was a scary sight. And when you ingore one, he gather troops to try to get you back into the game. Just because he was out of money if I bright no one in. Are you gonna pay me my money back for the pile of trash in my garage? Plus Sams membership is $40 and you don’t get useless crap in the mail.
I meant brought not bright. Stupid auto check.
Exactly. Lotteries have probably made more people financially independent that Amway… that does not mean they are a good or reliable way to make money…
If Amway was a scam it wouldn’t have an A+ with the Better Business Bureau. One of the only companies to help over thousands of people become financially free. What other companies have done that in the world? To empower you with a multi billion dollar business? To take a broke person like you or me and help them become multi millionaires? I can’t think of another company that even comes close, because there isn’t any. Do liable research before you destroy anymore lives, including yours.
Source, Wikipedia…
Pyramid scheme accusations
Amway has several times been accused of being a pyramid scheme. A 1979 FTC investigation in the United States, a 1997 Belgian court and a 2008 court judgment in the United Kingdom all dismissed these claims. FTC investigation
Main article: In re Amway Corp.
In a 1979 ruling, the Federal Trade Commission found that Amway does not qualify as a pyramid scheme since Amway compensation system is based on retail sales to consumers, not payments for recruiting.
I have to disagree with the internet part of your argument.
Some of the products are indeed worth buying. I’ve bought a few of them. And the odds are that I wouldn’t have heard of them had they not been promoted by someone. The people that you want to promote your product probably won’t unless there’s something in it for them. The more that’s in it for them, the more they’ll promote it.
The price is more or less the same whether the company gets all of my money, or whether they split my money with someone who was helping them. So what?
yep, I saw the scamway syndrome in my relative, her basement filled with scamway tapes and books and boxes of unsold ‘inventory’, and the guilt trips from her for not supporting her ‘business’, and she had a masters degree in engineering! Stay away, far away! I was shocked to see an ad from these crooks on the world series, why arent they all in jail?
C;mon if it were a scam would it had survived 50+ years? have a AAA+ rating on the BBB? partnered with many nationally know companies (sears, Visa, Barnes and Nobles, Disney, Office Depot etc) let fox, espn, tbs advertise on their networks…let the Orlando Magic, Detroit Red Wings, Inter Milan sponsor them etc etc c’mon, its more than common sense.
Well.. lot of things have survived for more than 50 years..like organized crime, drug cartels, .. mere survival does not make anything legal or morally right! Scams are usually legally right… but the net effect is reprehensible and immoral.
WOW you really must be special stupid. I’d love to meet you face to face because you talk so big online but in person you wouldn’t say a thing. I love the comment about they should all be in jail……… LOL I think you should be the one in jail for being that guy. that guy who has no backbone and only has a negative comment for something he knows nothing about. I’ve helped more people working with AMWAY than you”ll ever help in your trailer park drinking your beer and talking about how smart you are to the boys at apple bees.
anthony,
I’ll bet you’re too scared to talk on the phone about your Amway scam.
Who made your relative buy the products. That is the person to blame. Personal choices, should be also personal responsibility. Stop the blame game.
Flexo! you have your head up your ass! Obviously you know nothing about Direct Selling, or, just maybe you do, since you sound so bitter about the business model. You sound like you have failed at a direct selling company, or have gotten burned. To bad…… they say one bad apple can spoil the whole bunch.
Here come the trolls…
Amway is STILL a scam:
Click on the Texas flag for the details.
Amway never was and still isn’t a scam. A comment like that has no weight considering all the people the company has helped and continues to.
anthony,
Amway has hurt FAR more people than it helps. You don’t have a single clue.
No buddy you don’t have a clue. That’s totally untrue and I’d love to talk to you on the phone on face to face, and ofcourse they make money on training materials. How are they suppose to produce and sell tools with no profit. That makes mo sense at all. The difference is they don’t rape people like so many things do. Collages charge $150.00 plus dollars for a book and forget about tuition how much that is but that ok. A cd that actually teaches you something costs $7.50 and books aren’t anymore than $15.00. That to me is a much better deal than I’ve ever herd. It’s the cheapest educational system around. If you go to a seminar it’s $12.00. If you go to a weekend event the ticket for the whole event is $110.00. That’s for three days. You can’t go to a crappy concert for three hours for that cheep. And 80% plus of my income comes from Amway. Not tools but I do make money from education. I’d love to have a conversation over the phone with you if you’d actually listen and see how our team works. Is Amway perfect……no. Do we get better every year yup we do. The lawsuit was from two lawyers who wanted to get paid and they did but Amway settled because just staying in court was costing them millions. Anyway j could go on and on. Amway and the business team I work with has changed my life and many people on my team. I thank God for what it has done for me and my family.
Even the fact that you have to defend this company and its products so vehemently says a lot. As for cheapest education system, you do get what you pay for. In the company I worked for, we learned quite a lot about our products and how great they are, mostly from CDs, books, and (sales/motivational/brainwashing) seminars. They also taught us quite a bit about our business and such, with excellent explanations for why you can make money off of your team’s sales.
Then I went to college and got a real finance and business education. It cost quite a bit more than the cheap CDs and books, but from it I learned that our products are just average, not great, that they were quite a bit more expensive than many other options out there that work just as well, and that the thing we were calling “business” isn’t really a business, but just an agreement with a bunch of people that we will all keep doing what we were doing. There is nothing of inherent value in these businesses, since all we were are just sales employees for a bigger company. So, with the better education I learned that we were selling mediocre products, up-selling them as if they were great to overcharge gullible customers, spreading the ripped-off wealth, and in the end had no accumulated business assets or guarantee that the business income will continue.
In the world of business, all profits trend towards $0. If you are making a huge profit, you are either adding a huge amount of value to your product, have a monopoly on something that can not be replaced or substituted, or are selling to gullible fools who don’t bother to research your sales pitches and products. You guys don’t have a monopoly, since everyone sells products similar to yours. So, you’ll either have to explain what enormous value your selling activity is adding to the manufacturing cost the product, or admit you’re exploiting gullible fools.
Amway sales people lie through their teeth regarding their statistics. The products they sell are in no way cheaper than what is available in stores. Their big kick then became that it could be delivered to your door and you wouldn’t have to “take the time” to shop. The tapes and events and meetings where fees were charged simply lined the pockets of the “Diamonds”, who in reality are coal. There will come a time when they have to answer for their deceit. God help them when that day comes. Enjoy your life on this earth, my friends, because where yoiu are going, SPF 1000 will do you no good! You absorb the recognition at your events, which are simply awards for those who can exploit the most people in the shortest length of time. Then you spend millions on your cars, homes and material things in an effort to draw more into your web to sustain your greed. I pitty you and your shallow existance.
I’m not your buddy, and you need to do more than throw out an empty “No buddy you don’t have a clue” line, you need to back it up with facts. Here’s the conference call number: 760-569-6000, access code 975016#, dial *67 first if you want to keep your number confidential. I live in the Central time zone, propose a couple of times over the couple of days and I’ll let you know whether I’m available or not. You need to be prepared with information regarding how much the production costs of the tools you named are, or you’re going to look VERY stupid on the call. I wouldn’t knock college if I were you, you had several misspellings that even a high school graduate shouldn’t be making. LOL Amway settled because they failed to get the case into their unconscionable and illusory arbitration process, and are scared to death about the facts getting out into a public court case, which would set precedent for future lawsuits. As I said above, I wasn’t talking about you, I was talking about the VAST majority of ripped off IBOs. Get the soap out of your eyes for a change and see the big picture. Hint: The first sentence in the book, “The Purpose Driven Life.”
Amway doesn’t have anything to do with tools if that’s what the arguement is. Tools come from the training organizations, which in that case, yes the training orgs may make money off the tools, but not Amway.
Fred,
Amway may not make money directly off the tools, but they do indirectly. Years ago, Rich DeVos made a speech where he told the LCKs (Lying Cowardly “Kingpins”, aka upline IBOs) that if they wanted more money, go sponsor more people or sell more product, because Amway didn’t want to share more of their profit. With the LCKs suckling off the teet of the Amway Tool Scam profits, Amway no longer is being bothered by the LCKs asking for more of the Amway profit or lower product prices, because the LCKs are even worse abusers of this issue.
That’s not true. Amway makes no money off tools. It has nothing to do with them. Amway makes money off the products sold, that’s it. Just like a Wal-Mart, Target, etc. And yes I know there are some training organizations that were criminals in the past, and they were actually kicked out of Amway and their businesses were taken away. Because these upline IBO’s in these bad training organizations were, yes, ripping people off and stacking people’s names list only for their benefit. They were kicked out of Amway because what they were doing were hurting people. It was these organizations that hurt people, not Amway. Amway was protecting people from these stacking organizations. And now people from the past are all bitter and blogging because of “bad IBO’s” screwing people over, and they think it was Amway that did them wrong. Training organizations and Amway are different companies altogether. There are rules and restrictions set in place before an organization can become a training organization with Amway to protect everyone. And I’m sorry Tex, but I have yet to see prices go back up from the 1/3 cut they did last year, and I also saw PV go down with the BV as the price was cut too. I saw it all happen, and it’s all the same still. Maybe a few adjustments, but nothing like the prices they had before the cuts. Not even close.
Nobody makes anybody join any of the MLM businesses. It is personal choice and if a person doesn’t do good at it, there is only one person to blame. Yourself. Get off the blame game and make your own life happen. It is all about attitude
These businesses have always interested me. A doctor I had years ago recruited me into Amway, but it wasn’t for me. I didn’t like the meetings and being encouraged to want things that I didn’t want – because I had needs to be concerned with. Still, how much difference is there between Amway, Avon, Mary Kay, Arbonne, etc? I’m sure people in each can succeed or fail, and their opinion is in direct alignment with how it affected them personally. Some of the MLMs have extremely overpriced products, but they are exclusive, like MonaVie. Acceptably priced products don’t yield much/any income when the distributor must pay shipping/handling. When I was actively running a home business and purchasing supplies at wholesale, I found that I could purchase items for less online at retail, because no shipping charges and no tax makes an important difference. I think the biggest key to the failure in these businesses lies in the fact that the distributor is the customer of the company. The design is for the company to make money, period. “How can you sell a product if you don’t use it yourself?” 😉
As an Amway IBO, who sells and sponsors, and makes a profit, I believe the problem is that people are not able to draw a correct conclusion based on the data they have. For example, I can not play the piano: therefore I can assume that a piano can not be played.
Look, if uncle Bob didn’t make any money selling Amway products, maybe it is because he is a lousy salesperson. And if Uncle Bill DOES make money selling Amway products, then the conclusion is that he is ripping people off, he is involved in a scam and so forth.
Some, perhaps most, people aren’t good at it. I in fact own a piano, friends who come over enjoy playing it. I have no musical talent. Should I conclude that the guy who sold me the piano was involved in a fradulent scheme, leading me to believe that I could someday cut CD’s?
Everyone isn’t cut out to sell, sponsor, or do a host of other things. That doesn’t necessarily mean that those of us who can, are scamming,
Well said. Just another bunch of people that chose not to work hard, and blame it on the company. A person has the potential of making a 6 figure income in most MLM businesses. 5 times more like in a matter of fact. If working for an employer is he a scammer becasue he is above you? Corporate, and government are both pyramids
WRONG. Amway is a scam because of the Amway Tool Scam: http://texsquixtarblog.blogspot.com
A person has the potential, in the same way someone who goes to work for McDonald’s has the potential of becoming a manager of the restaurant and making 6 figures. The potential is there, but it’s nowhere near guaranteed. The issue with MLM’s isn’t potentials or whether it’s a personal choice to join one, the issue is false claims made by MLM’s and their recruiters. a fraudulent claim is a fraudulent claim, regardless of who makes it, and MLM’s just seem to be really good as making them.
Exactly. One of the worst offenders is Amway, see above link for more information.
How ironic that you make a comment about how legitimate Amway is, on a story about a $55 million dollar lawsuit they lost and had to pay.
I think the successful lawsuit against them on the grounds of skewing profits and disclosing gross income, rather than profit firms up the notion society has; that Amway is a scam.
If their marketing practices were legit, would any of that $55 MIL had filtered its way down into your income stream? I doubt that very much.
These schemes mask themselves in all sorts of categories and business models. Selling mona vie juice, ShopToEarn, Lia Sophia jewelry, etc. – these are all “businesses” people I know are in. They’ve tried to recruit either my wife or I at least once. Aside from the FACT that virtually nobody makes any meaningful income doing this except the people that are “insiders” from the early days doing the recruiting, it’s just slimy. My wife’s one friend is constantly hosting these “parties” and selling friends toy jewelry at inflated prices. Personally, I don’t think I could bring myself to do this, even if I we were facing financial hardship, which her friend is not. Aside from pissing off your friends and family, you look like a fool trudging through these workshops, flying around the country for “conferences” and spewing cheerleader-type messages on facebook constantly. It’s really annoying, the odds of making meaningful income are quite low, and you could be spending your time doing something more rewarding.
When you’re approached with a great “business opportunity”, just do some simple research around the web and you’re sure to find what a scam it is.
Multi-level marketing is just a method of paying commissions. The problems you mention have to do with illegal pyramid schemes (making money strictly for recruiting), unethical practices by upline members (hyping, brainwashing, religion-like meetings, overpriced materials), and bogus products with no marketplace. Seriously, not all direct sales/MLM companies are like this, but that’s probably difficult to see if you’ve been burned by a bad one.
Here’s a test: if you cannot sell the product to customers, it’s probably not worth joining.
Have I got a story for you. This is like the organized, personal finance geek’s worst nightmare.
In the late 1990s, when my now-wife and I were in college and had been dating for about a year, she mentioned that her parents did Amway and said she was considering doing it too after graduation. I knew little about Amway at the time, but my impressions were not positive, and as she described her experience growing up with it and using terms like “growing my business,” my spidey sense tingled. I was a marketing major so I had an especially keen ear for this stuff.
Sure enough, I did some research on it and discovered for myself what a scam it was. HUGE arguments ensued. Looking back I’m somewhat surprised our relationship survived, but over time my wife came to realize that it wasn’t a legitimate business. But her parents were still involved – now keep in mind that “their business” consisted of buying lots of books and tapes, attending conventions, but never actually selling anything as best I could tell.
Fast forward 12 years. My father-in-law was diagnosed with ALS and we’ve been spending time trying to get their house ready for sale so they can move into a smaller, more accessible home. As a lot of people do, they’ve accumulated a lot of “stuff” that just occupies space in their house so we’ve been going through a lot of it.
I bet I carried 10-15 good-size boxes FULL of Amway books and tapes out of a closet in their basement. Many still in their original wrapping, never listened to. Now worthless. I know we will find more materials elsewhere in the house as we continue to sort through it.
Think of how much money they must have spent on that over the years, all so they could “build their business,” which they never did anyway. They use Amway products but to my knowledge don’t sell them to others nor do they recruit. All that time and money wasted.
How can people fall for this? And even if you didn’t know any better, how many years of not profiting from it would it take before someone says enough is enough?
A friend of mine just got suckered into selling books door to door. It’s best to avoid these MLMs.
I’m not a fan of MLMs, and you’ve done a great job of explaining the problems with them, Flexo! I’m sure you’ll get some flack for this, but I see what you’re saying.
If MLMs were evaluated purely on their value as a standalone company (no downlines, motivational stuff, etc.) no one would ever start them. Like you said – mediocre products or services that are overpriced. When did that ever make for a great business plan?
My big problem with them is how they infiltrate churches under the guise of a “Christian” company. I can see why they do it – talk about a highly trusting and large network! But to exploit a fellow Christian for a quick buck is clearly wrong. No one sees it this way though because of the motivational brainwashing that happens!
Hey Flexo, it goes much deeper than just selling products. What makes the most money for the “top earners” are the overpriced CDs, cassette tapes, motivational seminars, and full retail price books that are sold to recruits. Recruits are told that the “secrets” to making the big money are in these items when 90% or more of the top earners income comes from selling these “tools” to the newbies.
No matter what they call it — multilevel marketing, network marketing, direct marketing — it’s a cancer that we need to regulate away.
Just my 2 cents.
This is especially true for Amway. Click on my Texas flag for the details.
How do you suppose we fix this “Problem”? Amway is based off the Free Enterprise idea. You can’t fight ideas unless you solution. Are we supposed to believe that going to work for one of thee bail out companies whose CEO is getting more in bonuses than most americans will see in there life? Amway offers you the opporunity to have a dream and gives you a way of obtaining that goal. Until you can come up with a way of reaching dreams don’t bad mouth Amway. Plus Amway doesn’t sell tapes cds or support material. That is the group or line of sponsership you are a part of. Can’t blame the whole because of a few.