Thursday, January 8, 2009

Amway - What Are Your IBO Expenses?

Do whatever it takes? That's what many IBOs and prospects are told when they are presented with the Amway plan. However, it is my understanding that you can get started in the Amway opportunity for under $50. If you see other figures, you may contact the corporation to check. Certain groups will sell products with their regustration kits so the price may be quoted as higher. Some groups may add in some motivational tools as well.

But aside from registration, what are your expenses? It is my guess that from the Amway Global perspective, there are no other required expenses. Some IBOs don't even bother to order products!

Where IBOs and prospects must beware of though, are the business tools and instructions that some groups sell. There are various (for profit) organtizations that promote and sell these types of motivational and instructional tools. Some of these organizations may include WWDB, BWW, Network 21, LTD, etc etc. These tools may bepromoted as vital orthe key to your success.

Despite what your upline or sponsor may tell you, these materials are purely optional and they are not likely to make a significant difference in the experience of most IBOs. Most IBOs would be better off not purchasing any of these materials. Most IBOs would be better off focusing on selling Amway products for profit.

There are some IBOs who participate in these systems and succeed, but the IBOs who achieve anything of significance (Diamond and above) are a small fraction of 1% and they are few and far between. A dismal achievement rate given the amount of money invested in these systems by IBOs.

13 comments:

Dayton Platinum said...

Ok, so let me give you a rundown of what my basic average expenses were during my first 2 years. I was single the first year and married the second so you can double year one in year two. First of all, I will not consider money I spent on product that I used and consumed as expense. A common fallacy of anti-Amway supporters.

Year one: 4.00 a week open meeting tickets or $108.00 for the year. 4 conference tickets @110.00 for a total of $440. Hotel, about $50-75 a weekend as a single, for around $300 for the year. Tapes (at the time)$6.00 a week for standing order or $312 a year. Extra tapes that I bought during year 1, about $1200, books I bought during year 1, about $600. Then you have gas, but since I deducted miles from taxes and not gas reciepits, I logged, only for Amway related meetings, about 18,000 miles on my Honda Accord. All other incidentals, food, drink car maintenance etc....was stuff I had to spend anyway. I can't measure that against a non Amway persons, music CD's, Rock Concerts, movie tickets, Starbucks on the way to work, or food ate at work related lunches and work conferences etc.

So that all adds up to about $3060 for the year, but I will throw extras in there and say maybe $4000-4800. So lets say my minimum monthly during year 1 was anywhere from $300-$400 a month.

Now I personally take into account that I was saving nearly that much or more by not going to 4-5 rock concerts that year, I quit buying music CD's for $15-22 a pop, I dropped drinking on Friday and Saturday nights, which was always $50-100 a weekend.

I wasn't making much more than $200 a month at the end of year 1, so I made less that $2400 during that first year which means I showed a loss.

In March of my second year, I hit Silver and kept $2175 in March, when I hit Gold in May, I made $2534 and got a gold bonus of $1000 for a total of $3534 and 3 months later I hit Platinum and was keeping right at $3000 a month, and I started recieveing tool breaks which added about 100-250 a week. In our 3rd year we hit Q12, and made a total, with the Q12 bonus of 10K of just a hair under $52K (Amway only)

That is on top of my job salary of $43,000. So I hope that helps answer. No I'm not rich or driving a Lambo, or claiming that you'll be working for me one day. I'm just giving you the data

Joecool said...

Dayton Platinum,

Thank you sincerely for your response. I am glad you are successful.

Yhe real issue here is not you. I know that some people succeed in Amway, some are very sucessful.

The issue is that downlines pay for upline success.

Thus if your downlines, say are spending what you spend on cds, seminars, etc, but are unable to sponsor others to increase volume, they they spend in the neighborhood of $4000 a year to earn $8 monthly checks.

Gina said...

"All other incidentals, food, drink car maintenance etc....was stuff I had to spend anyway."

See now this is why so many of us critics have a problem with you supposed business owners. The lack of common business sense is astounding.

First, just because you think you would spend it anyways does not negate it as an expense.
Second, if you negate these items as an expense because you would have spent it with or without Amway then how is it you can justify supposedly saving money due to Amway by not going to rock concerts, drinking, buying cd's and such? You are not including basic and standard business expenses on top of subtracting personal expenses that have nothing to do with business. Do you really think someone like Steve Jobs looks at his monthly expenses and says "well, I will not submit for reimbursement for my food since I need to eat no matter what and look how much more money I make now that I work so many hours and have virtually no time for fun like going out to drink and see concerts!!!!" Please...

If you are going to purport to be a legitimate business owner then at least make the minimal effort to actually be convincing as one.

spending money on products you personally consume is still an expense. No fallacy just hard facts. The 1099 you are issued yearly by Amway includes this amount. A copy of the same 1099 is submitted to the IRS. By not tracking this as an expense in order to write of the expense properly at tax time means 2 things...1) you are overpaying on your taxes and 2) you are falsifying your so called business' performance thus risking that the IRS will deem it a hobby thus not rewarding you or your so called business any tax exemptions.

Anytime you would like to know what a legitametly run, profitable business has on their P/L, you just let me know.

mike said...

Dayton Platinum states "In March of my second year, I hit Silver and kept $2175 in March, when I hit Gold in May, I made $2534 and got a gold bonus of $1000 for a total of $3534 and 3 months later I hit Platinum and was keeping right at $3000 a month, and I started recieveing tool breaks which added about 100-250 a week. In our 3rd year we hit Q12, and made a total, with the Q12 bonus of 10K of just a hair under $52K (Amway only)"

What were your expenses during those times?..and as far as the "Amway only" income does that include the money from the "tool breaks"

Dayton Platinum said...

I covered that in the 5 paragraphs before the one you quoted. I started recieveing tool brakes at platinum.

David said...

I recently started in Amway so I can't give a good breakdown of the costs. I can say that I've been in sales for over 10 years and if I had to add up all the training I've acquired over the years, including Zig Ziglar, robert kiyosaki, Dale Carnegie, Grant Cardone and many others, the price would be very high. Anyone is sales management knows that it is imperative to keep your people motivated.

When my wife and I joined Amway we were not told that we have to buy the training products, rather that it is highly recommended if we wanted to meet our business goals quickly.

When I sold insurance and investment products for a hugh conglomerate I had to buy all my own marketing materials (from them), rent my desk and phone. All this and I was a full-time employee of the company and required to work 9-to-5 normal work hours.

I do agree with the statement that, "most IBOs would be better off focusing on selling Amway products for profit." But how do you sell anything without product knowledge? And when sales are slow how do you keep motivated?

Joecool said...

David, the real issue is that in Amway, you are basically a commissioned sales person. Most people are not cut out for selling Amway products and selling the opportunity. That's why so many do not achieve anything in this business.

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Anonymous said...

For all edumacated truth bearing non IBO critics that aren't making any difference in the world: you don't have any validity to even comment about anything in this topic. Statues are not made to critics, only visionaries who stand out and do something admirable. You can sell products all day long and make decent immediate profit, but if you don't read the books it takes to learn how to better yourself and therefore pour your life unselfishly into serving others than the income is only temporary. Who wants a 2nd job for the rest of your life. Retail selling is designed to cover all investments while developing your residual ongoing income based upon helping others meet their goals. The reason the business receives any flak is because the Teams who do this with standards and integrity are misunderstood. All winners are misunderstood. Always have been. Who else is doing what we do? Who else take the time out of the goodness of their heart to unselfishly work with people through their life's challenges, increase their self image and value, increase and strengthen their marriages (as mine was saved), giving them eternal hope and a destiny, all while getting them out of debt, preparing for their future, etc, etc... I'm glad my sponsor scammed me right into eternal life in Heaven, a happy marriage, and financial independence. Facts and truth are two different things, and if I get any critical comments due to what I am sharing due to my testimony, it's going to only be an opinion and any moron can give an opinion.

There is nothing better you can do with your life. And the one's who have been where I've been know what I'm saying. What's the alternative? No critic has one. Chinway? Rusway? Iranway? Socialistsway? No, the American way, based upon compassionate capitalism, bringing freedom and life of significance to people who have not died to their dreams and giving up and settling for average.

-Diamond Daniel

Daniel said...

For all edumacated truth bearing non IBO critics that aren't making any difference in the world: you don't have any validity to even comment about anything in this topic. Statues are not made to critics, only visionaries who stand out and do something admirable. You can sell products all day long and make decent immediate profit, but if you don't read the books it takes to learn how to better yourself and therefore pour your life unselfishly into serving others than the income is only temporary. Who wants a 2nd job for the rest of your life. Retail selling is designed to cover all investments while developing your residual ongoing income based upon helping others meet their goals. The reason the business receives any flak is because the Teams who do this with standards and integrity are misunderstood. All winners are misunderstood. Always have been. Who else is doing what we do? Who else take the time out of the goodness of their heart to unselfishly work with people through their life's challenges, increase their self image and value, increase and strengthen their marriages (as mine was saved), giving them eternal hope and a destiny, all while getting them out of debt, preparing for their future, etc, etc... I'm glad my sponsor scammed me right into eternal life in Heaven, a happy marriage, and financial independence. Facts and truth are two different things, and if I get any critical comments due to what I am sharing due to my testimony, it's going to only be an opinion and any moron can give an opinion.

There is nothing better you can do with your life. And the one's who have been where I've been know what I'm saying. What's the alternative? No critic has one. Chinway? Rusway? Iranway? Socialistsway? No, the American way, based upon compassionate capitalism, bringing freedom and life of significance to people who have not died to their dreams and giving up and settling for average.

-Diamond Daniel

Anonymous said...

Hi
Very nice and intrestingss story.

Anonymous said...

hi. very interesting story, but nice? nah. daniel is just another ambot trying to get his point across to folks in the real world and failing every single time. i actually find that hilarious!