Amway/Network 21

[Dave A]

"According to Amway, their annual sales amounts to about $7 billion and there are 3 million distributors. Thus, the average distributor's sales amounts to about $2,333/yr. If 30% of that is profit, the average distributor makes $700/yr. Klebniov claims that the average income is $780, but the average distributor buys $1,068 worth of Amway goods himself and also has expenses such as telephone bills, gas, motivational meetings, publicity material and other expenses to expand the business. "The average active distributor sells only 19% of his products to non-Amway affiliated consumers," according to Klebniov. "The rest is either personally consumed or sold to other distributors." In the United States, the Federal Trade Commission requires Amway to label its products with the message that 54% of Amway recruits make nothing and the rest earn on average $65 a month. No such labels are required in other countries, but the facts are clear. Most people who get involved in Amway will not make money."

Harvey, the stats are horrific. What's missing above is (about*) 80% of distributors never sponsor anyone - primarily because they never even gave it a decent shot.

Take that 80% out of the "distributor" category, shunt them to member consumers and the stats on the people actually working the system improve substantially.

They're still not great, but then neither are the stats on the number of new "traditional" businesses that make it past the first year - run traditional business success rates to five years and it gets even worse...

I've never seen a stat on what the average earn is for Amway distributors who have been in for 5 years... It would be interesting.

Ultimately the FTC should, in the interests of consistency, insist that every business licence and business registration document issued in the USA contains a warning that most businesses fail in the first year and most small business owners lose their life savings in the process.

Make no mistake, you're going to have to beat the average to succeed. And that applies to a lot more than Amway.

*relying on memory from a stat given to me quite a few years ago.

[Rob Hepple]

Harvey, the stats are horrific. What's missing above is (about*) 80% of distributors never sponsor anyone - primarily because they never even gave it a decent shot.

Take that 80% out of the "distributor" category, shunt them to member consumers and the stats on the people actually working the system improve substantially.

They're still not great, but then neither are the stats on the number of new "traditional" businesses that make it past the first year - run traditional business success rates to five years and it gets even worse...

I've never seen a stat on what the average earn is for Amway distributors who have been in for 5 years... It would be interesting.

Ultimately the FTC should, in the interests of consistency, insist that every business licence and business registration document issued in the USA contains a warning that most businesses fail in the first year and most small business owners lose their life savings in the process.

Make no mistake, you're going to have to beat the average to succeed. And that applies to a lot more than Amway.

*relying on memory from a stat given to me quite a few years ago.

Thanks Dave A. Apologies to those of you asking questions. Yes I have been vague in my replies. The Amway business is, as I have said previously, a business like any other. As far as what the turnover was over the past year was I'm not absolutely sure but it was up by about 10-15% so that must push it up between 8-9 billion dollars.(56-63 billion rand) The company is growing incredibly well in these hard times when most other companies have shown very little or no growth over the same period, and it is debt free. Amway the company is going to be there forever to back up the network so we can feel secure that it is the rock on which we can build our businesses.
What does this information mean to each and every distributor old or new? Apart from the obvious security, absolutely nothing. There are many Amway ditributors who sign up into the business just to get the products at wholesale, get home delivery and use them for themselves. Does the network benefit, of course it does! If they sign up in an active consumer pipeline then they will benefit from further growing discounts(from 3 up to 21%). Then there are many people who sign up into the business who initially see it as a get rich quick and easy scheme and, when it becomes obvious that there is work involved, they are not prepared to put in the hard yards and they either cancel or slowly fade away into the background and from this group are the people who say the business doesn't work. About 15-20% of the people who sign up are the ones who go on to build significant businesses.
Network 21 has nothing to do with Amway, the company. They are a business that markets a step by step business system that, if you are prepared to follow it, will give 100% predictable results. It is not an information platform for Amway. It is not there to give figures about how Amway is doing financially. It is a business education system. What is the system? It is a system of listening to cd's,(some have success stories-case studies, some teach specific things, some target people with specific business backgrounds etc.), reading business education books and attending regular meetings and seminars, just like any other dynamic, results driven business.
If anyone who wants to achieve financial independence but more importantly, build a life of true significance within a relatively short period of time, this is the business for them. The naysayers are out there by the dozen. If you listen to there inane invective you'll never achieve anything. Focus on the success because it is there in heaps and it's not just the people who have been in the business for a long time.
Remember, it's no good sitting on the sidelines poking the business with a stick because the snakes will jump out and bite you. If you really want to change your financial future, get busy with the business or otherwise walk away from it and focus on something else. Amway is the company who offers ANYONE the opportunity to start their own business for very little capital investment(R50) by re-directing their normal monthly expenditure to save money and make money. Network 21 is the company that provides the business system to achieve success. The business system is optional, you do not have to use it, but I would advise everyone to subscribe to it because if you follow it to the letter you will succeed.

[Zaxisus]

Allrighty, so after 2 years I'm back to give my personal view on how Amway worked for me. In short, it didn't, but bear with me while I explain why it didn't. I understand it will be different for everyone and people should not base their decision to join/not join Amway solely on my view. But it might help...

I was involved with Amway for a year. For that year I was a fully-fletched groupie. I went to all the meetings, all the team-buildings, introduced all my friends to the business, and even joined the Sunday afternoon call sessions. But, when my membership came up for renewal I got out and away from Amway as fast as my feet could carry me.

Herewith some basic stats (from MY experience, and based on last year's prices):
- Joining up fee: R75 + R120 membership fee + products to the value of R650. You could not do one without the other
- Starter Pack for start-up training: R250 (this is a N21 product and not Amway, but Amway is using it for their basic start-up training)
- Monthly products to the value of R1200 (to get to the first 3% commission hurdle and keep your crown as a "trendsetter")
- Monthly BBS meeting: R100 (Business Building Seminar - this is where the Diamonds tell you what they did to make it to Diamond stage)
- Quarterly WES: R750 (Weekend Seminar - and if it is in Jhb, flights and accommodation)
- Weekly Meetings: R20 (for venue hire - if we brought interested people we did not have to pay for them)
- Yearly Membership fee: R120
- Optional CEM (Continuing Education Material from N21): R240 per month and up, depending on which package you take. For the basic intro level you get one book and 3 CD's per month. You are supposed to use the material to motivate you and others to build your business and learn from the experts by listening to the testimonial CD's.

Above and beyond all this I changed my insurance to Amsure, even took out a Vodacom contract in an attempt to scrounge together as many PV as possible.

What I have learned from this experience, is that (unfortunately) you need money to make money. Even though the Amway products are amazing, they are quite expensive and that makes it difficult to sell to try and make some kind of return on your investment.

So, like I said, this did not work for me. I actually ended up losing money. I'm sure this would have evened out in the long run, and maybe after a few years I might actually have turned a profit. For me it just seems like too much work to earn the "passive income" they promised. I'd rather invest my money - at least then I'll know I'm getting something back without working for it!!

[Rob Hepple]

Allrighty, so after 2 years I'm back to give my personal view on how Amway worked for me. In short, it didn't, but bear with me while I explain why it didn't. I understand it will be different for everyone and people should not base their decision to join/not join Amway solely on my view. But it might help...

I was involved with Amway for a year. For that year I was a fully-fletched groupie. I went to all the meetings, all the team-buildings, introduced all my friends to the business, and even joined the Sunday afternoon call sessions. But, when my membership came up for renewal I got out and away from Amway as fast as my feet could carry me.

Herewith some basic stats (from MY experience, and based on last year's prices):
- Joining up fee: R75 + R120 membership fee + products to the value of R650. You could not do one without the other
- Starter Pack for start-up training: R250 (this is a N21 product and not Amway, but Amway is using it for their basic start-up training)
- Monthly products to the value of R1200 (to get to the first 3% commission hurdle and keep your crown as a "trendsetter")
- Monthly BBS meeting: R100 (Business Building Seminar - this is where the Diamonds tell you what they did to make it to Diamond stage)
- Quarterly WES: R750 (Weekend Seminar - and if it is in Jhb, flights and accommodation)
- Weekly Meetings: R20 (for venue hire - if we brought interested people we did not have to pay for them)
- Yearly Membership fee: R120
- Optional CEM (Continuing Education Material from N21): R240 per month and up, depending on which package you take. For the basic intro level you get one book and 3 CD's per month. You are supposed to use the material to motivate you and others to build your business and learn from the experts by listening to the testimonial CD's.

Above and beyond all this I changed my insurance to Amsure, even took out a Vodacom contract in an attempt to scrounge together as many PV as possible.

What I have learned from this experience, is that (unfortunately) you need money to make money. Even though the Amway products are amazing, they are quite expensive and that makes it difficult to sell to try and make some kind of return on your investment.

So, like I said, this did not work for me. I actually ended up losing money. I'm sure this would have evened out in the long run, and maybe after a few years I might actually have turned a profit. For me it just seems like too much work to earn the "passive income" they promised. I'd rather invest my money - at least then I'll know I'm getting something back without working for it!!

Hi Willemien. Your story is like many others and mine. I was initially frustrated out of my brain and I had to step back and look at the situation and ask the question, " is it the business that is not working or is it me that is not working the system consistently, to the letter." You know the answer. The business is an inanimate thing. Nothing will work unless you do the work and use the right tools. You saw and heard all the successful people saying it over and over and, if you were anything like me, you applauded them, made all the right resolutions and when you got back out to the coalface the fact that you had to show at least 15 plans a month and follow up on those people was daunting, to say the least. If you had hung in there and bit the bullet it would have happened.
It's exactly the same in my job. If I do not get out there, knock on peoples doors and pick up stock, take clients out to view the properties on a daily basis, me and my family will starve and I will be fired. Those who go out there and do the extraordinary reap the rewards. The business is up to you. Because people work it part time and they still have an income, if it becomes tough and it's easy to say the business doesn't work(as an excuse) and trash it to their friends. It takes guts to admit that they didn't do the work and follow the system. It's easy to be a groupie and go to the meetings and get a few friends involved but, when your friends list runs out and you have to start prospecting for real and you're not following the system, you hit the wall. The people who get up and decide to follow the successful people are the ones who make it. Please remember this is not a job with a boss to keep on prodding you. Here it is up to you.
In any business that you start you will require capital(certainly far more than is required in the Amway business). If you fail you cannot blame the business because you are the driving force behind it. At least 95% of all new businesses fail in the first 5 years and the people lose their capital. Do they get onto the internet and trash whatever business they were involved in. No, because that would be tantamount to admitting that they failed because there is no one to point their fingers at. In the Amway business when people fail to do the work it is very convenient to point fingers at Amway and say Amway didn't work. The question is, who didn't do the work and follow the system?
Amway is certainly not using N21 to build the business. It is N21 that is using the Amway business as the vehicle to earn the money. When anyone signs into the business, N21 is always optional. Worldwide there are other training systems, not just N21. When Amway launched in South Africa there were a few other training systems operating but they were not as successful as N21and subsequently changed their focus to other countries. Anyone can start an Amway business and work it on their own or just use the products.

[Dave A]

I was initially frustrated out of my brain and I had to step back and look at the situation and ask the question, " is it the business that is not working or is it me that is not working the system consistently, to the letter." You know the answer.

I think we need to concede that sometimes it's just a bad fit. It's not the right time in their life, they didn't click with their upline enough to get out of their comfort zone, or even they're simply not cut out for it full stop.

I also think it's a bit glib to focus all the failure blame on the person quitting -

At least 95% of all new businesses fail in the first 5 years and the people lose their capital. Do they get onto the internet and trash whatever business they were involved in. No, because that would be tantamount to admitting that they failed because there is no one to point their fingers at. In the Amway business when people fail to do the work it is very convenient to point fingers at Amway and say Amway didn't work. The question is, who didn't do the work and follow the system?

when all too often there's so much pressure put on them to join in the first place. Were they really that interested or were they just taking the easy out by signing up?

No surprise so many go through the motions, and wait for the chance to slip away without too much fuss.

It's a little different to the traditional business failure - at least there you're not normally faced with a well-trained extremist dreaming of yachts, fast cars, exotic travel etc. pushing you into doing something you're actually pretty reluctant to try on.

[harvey999]

Thanks Dave A- still sceptical about some things

Harvey, the stats are horrific. What's missing above is (about*) 80% of distributors never sponsor anyone - primarily because they never even gave it a decent shot.

Take that 80% out of the "distributor" category, shunt them to member consumers and the stats on the people actually working the system improve substantially.

They're still not great, but then neither are the stats on the number of new "traditional" businesses that make it past the first year - run traditional business success rates to five years and it gets even worse...

I've never seen a stat on what the average earn is for Amway distributors who have been in for 5 years... It would be interesting.

Ultimately the FTC should, in the interests of consistency, insist that every business licence and business registration document issued in the USA contains a warning that most businesses fail in the first year and most small business owners lose their life savings in the process.

Make no mistake, you're going to have to beat the average to succeed. And that applies to a lot more than Amway.

*relying on memory from a stat given to me quite a few years ago.

Thanks Dave-
What worries me is WHY the 80% dropout rate?
The standard Amway response to this is: "oh they weren't prepared to give it a full go". I believe this is true for certain a certain percentage. However, there must be a fair amount who leave because they see the time, effort & resources required to build more of AMWAY'S BUSINESS (note) are just not worth it, once they find out the truth. This seems true for more than than one contributor on this thread. Also, trying to sign friends/acquaintances up can LOSE you friends! Seen it myself. Once people find out you got them together for an ulterior motive, the attitude and ambience of the gathering can change completely. You can lose a lot of respect from former friends like this!

Interesting discussion though... lively debate

[Nigel Hamilton]

What is the failure rate of small business in SA, isn't it close to 90%?

80% pretty good then?

[harvey999]

Failure rate of businesses after 5 years is about 80% when i last heard.
HOWEVER, often the property, furniture & equipment & residual stock accumulated during the 5 years softens the blow, or liquidates the proprietor.... what is left after a network marketing venture... some stock & marketing experience perhaps?

[Rob Hepple]

I think we need to concede that sometimes it's just a bad fit. It's not the right time in their life, they didn't click with their upline enough to get out of their comfort zone, or even they're simply not cut out for it full stop.

I also think it's a bit glib to focus all the failure blame on the person quitting -

when all too often there's so much pressure put on them to join in the first place. Were they really that interested or were they just taking the easy out by signing up?

No surprise so many go through the motions, and wait for the chance to slip away without too much fuss.

It's a little different to the traditional business failure - at least there you're not normally faced with a well-trained extremist dreaming of yachts, fast cars, exotic travel etc. pushing you into doing something you're actually pretty reluctant to try on.

Hi Dave A. I really appreciate your comments and views. You and I have been around the block a bit. I am now 60 years old and I have had a few business ventures. Two were very successful, one not very successful and one was a total failure. All 4 were businesses that relied on me as the figurehead and sole proprietor. I unfortunately had no mentor in all of them and to this day I wish I had had one. There was a financial advisor, and a very successful entrepeneur, who took a liking and an interest in me and my business dealings. He was a fantastic guy and in hindsight his vision and advice was incredible. At that time he was 62 years old and was willing to mentor me and I blew it. I thought I knew it all and ignored his advice and eventually paid the price.
In the Amway business, IT"S THE SAME AS ANY OTHER BUSINESS. When I first signed up I thought this was a piece of cake. I also thought that the guys up on stage were a bunch of well trained extremists. Well, after a year and a half of complete frustration I had to re-evaluate. What was wrong? To cut a long story short I had to swallow my pride and admit that I was just not allowing myself to be teachable. Those well trained extremists are not extremists but people who have gone through the same trials and frustrations we all go through, allowed themselves to become teachable, and eventually reaped the success. Remember, success in this business lasts forever. Once the business is correctly built the income goes on forever. That's what it's all about. That's what very few other business's (if any) can give those who bite the bullet.
Failure in ANY BUSINESS is exactly the same. Whether it was your failure to have enough capital, failure to have enough knowledge, failure to take advice, failure to be teachable, failure to do whatever, the fact is you failed to do something that could have prevented the failure of your business. Face the facts and don't blame anything else, especially not the business for your failure. Quitting is admitting failure. If you follow, to the letter, the N21 system, then the business should start generating enough cash to fund your business by the second or third month.
So, what is the bottom line. Be prepared to be teachable from the beginning and follow the N21 system. This is a formal challenge. Anyone who signs up in the business from now on and follows the N21 system to the letter (in other words is prepared to be "core" for 2 years- I'll check with their upline) and does not succeed I'll print this whole thread and eat it.
ANYONE who truly wants the financial freedom that the Amway business offers can do it. It is just a decision that each and every individual must make because incredible rewards demand incredible commitment. If you understand this and commit yourself you WILL succeed.
Too many people want great rewards with no commitment. Doesn't work.

[Dave A]

That "extremist" crack got to you a bit, huh?

[Rob Hepple]

That "extremist" crack got to you a bit, huh?

It certainly did

[Dave A]

Unfortunately "passionate" and "extremist" are not that far apart. And as we know, being passionate in MLM is one of the keys to success. Your belief simply has to be far stronger than the prospect's doubt.

Most times it's your belief, your confidence that they're actually signing up for.

Just one of those situations where you're damned if you are (passionate) and damned if you're not - just in totally different ways.

[harvey999]

Hi Dave A. I really appreciate your comments and views. You and I have been around the block a bit. I am now 60 years old and I have had a few business ventures. Two were very successful, one not very successful and one was a total failure. All 4 were businesses that relied on me as the figurehead and sole proprietor. I unfortunately had no mentor in all of them and to this day I wish I had had one. There was a financial advisor, and a very successful entrepeneur, who took a liking and an interest in me and my business dealings. He was a fantastic guy and in hindsight his vision and advice was incredible. At that time he was 62 years old and was willing to mentor me and I blew it. I thought I knew it all and ignored his advice and eventually paid the price.
In the Amway business, IT"S THE SAME AS ANY OTHER BUSINESS. When I first signed up I thought this was a piece of cake. I also thought that the guys up on stage were a bunch of well trained extremists. Well, after a year and a half of complete frustration I had to re-evaluate. What was wrong? To cut a long story short I had to swallow my pride and admit that I was just not allowing myself to be teachable. Those well trained extremists are not extremists but people who have gone through the same trials and frustrations we all go through, allowed themselves to become teachable, and eventually reaped the success. Remember, success in this business lasts forever. Once the business is correctly built the income goes on forever. That's what it's all about. That's what very few other business's (if any) can give those who bite the bullet.
Failure in ANY BUSINESS is exactly the same. Whether it was your failure to have enough capital, failure to have enough knowledge, failure to take advice, failure to be teachable, failure to do whatever, the fact is you failed to do something that could have prevented the failure of your business. Face the facts and don't blame anything else, especially not the business for your failure. Quitting is admitting failure. If you follow, to the letter, the N21 system, then the business should start generating enough cash to fund your business by the second or third month.
So, what is the bottom line. Be prepared to be teachable from the beginning and follow the N21 system. This is a formal challenge. Anyone who signs up in the business from now on and follows the N21 system to the letter (in other words is prepared to be "core" for 2 years- I'll check with their upline) and does not succeed I'll print this whole thread and eat it.
ANYONE who truly wants the financial freedom that the Amway business offers can do it. It is just a decision that each and every individual must make because incredible rewards demand incredible commitment. If you understand this and commit yourself you WILL succeed.
Too many people want great rewards with no commitment. Doesn't work.

Sorry Chaps. Anybody who thinks Amway (or any MLM) is THEIR own business, is seriously misguided, or trying to fool others to sign up for their own benefit.
"Building your business": Another Amway term designed to create smoke and mirrors, and attract participants "down the pipeline".
Just like the Health and Environmental/Green cause. Great for marketing!

In an ordinary business, one has the FREEDOM OF CHOICE for suppliers, best quality at best price. Not in this case- its all channeled through Amway, high prices (they have to be) because all the participants in the "pipeline" need to get a piece of the pie: notably the "upliners" from the "down the tubers"!

Amway, admittedly, is a highly sophisticated sales structure. Supplying GOOD products, that must be said. But its THEIR business, the actual shareholders, not anybody elses!
And it is manned by highly skilled, PERSUASIVE salespeople "up the pipeline".
If you start getting involved and don't make it, you need MOTIVATION!
Come to the courses... only R750 a weekend, no food provided!
This is where most of the income for actual Amway or Network 21 shareholders comes from: Seminars (with no published agenda), and costly motivational material.
Can anybody challenge this? Please do.

Amway/Network 21 has been described by a number of independent sources on the web as a "Legal Pyramid scheme". This will be vehemently denied, but surely the "pipelines" need to be fed by other "pipelines", and what do you end up with?

Amway and Network 21 works- been around 50 years?, huge business.
But somebody loses.
They have to.
Many of those at the bottom.. as the statistics show.
What happens is they end up buying more of the products for themselves or family than they earn from bonuses.

Doubt whether this post will be passed by the Administration (or should i say "Amwinistration"!), but reading through the threads before this, I had to get it out...sorry!

[Rob Hepple]

Hi Dave A.
Apologies for late reply. My e-mail has been down for a couple of days.
You're absolutely right. When you've been through all the tough times and you start to really reap the rewards and you know what you've done is duplicatable, you become passionate about it. The rewards in this business, in my opinion, cannot be matched by anything else. I can only encourage whoever gets involved to give it a full go. Follow the system, listen to the cd's, read the books and listen to your upline who will mentor you.
By the way, Dave, you're on my list.

[Dave A]

Come to the courses... only R750 a weekend, no food provided!
This is where most of the income for actual Amway or Network 21 shareholders comes from: Seminars (with no published agenda), and costly motivational material.
Can anybody challenge this? Please do.

I believe that post has already been made.

Herewith some basic stats (from MY experience, and based on last year's prices):
- Joining up fee: R75 + R120 membership fee + products to the value of R650. You could not do one without the other
- Starter Pack for start-up training: R250 (this is a N21 product and not Amway, but Amway is using it for their basic start-up training)
- Monthly products to the value of R1200 (to get to the first 3% commission hurdle and keep your crown as a "trendsetter")
- Monthly BBS meeting: R100 (Business Building Seminar - this is where the Diamonds tell you what they did to make it to Diamond stage)
- Quarterly WES: R750 (Weekend Seminar - and if it is in Jhb, flights and accommodation)
- Weekly Meetings: R20 (for venue hire - if we brought interested people we did not have to pay for them)
- Yearly Membership fee: R120
- Optional CEM (Continuing Education Material from N21): R240 per month and up, depending on which package you take. For the basic intro level you get one book and 3 CD's per month.

Ok - I heard this morning that the Law Society is complaining that new law graduates don't have a grip on basic maths (or reading for that matter), so let me do the maths for you. Ignoring start-up costs as pretty much once-off, the relative monthly turnovers would be:

N21 turnover (Totals R686.67 per month)
Monthly BBS meeting - R100
Weekly meetings - R20 x 52 / 12 = R86.67
Quarterly WES - R750 / 3 = R250
Annual membership - R120 / 12 = R10 (I think that actually goes to Amway, but just in case)
CEP - R240

Amway turnover (totals R1200 per month).
Product sales - R1200

(I think it's reasonable to assume if you're "going all the way" on the N21 support program, you're going to spend this order of money on the product too).

Now here's your challenge - put that N21 package together for less money. Have you costed booking a venue for a convention lately, let alone all the other essential expenses required to make it an event?

Or bought any good books?

Doubt whether this post will be passed by the Administration (or should i say "Amwinistration"!), but reading through the threads before this, I had to get it out...sorry!

You probably should take a better look around TFSA. Very little spam but lot's of divergent opinions. Contrary opnions are encouraged - it's up to the reader to draw their own conclusions.

And on the subject of conclusions, here's mine on you:

• You've made up your mind already (which isn't a problem - in fact, good for you ).
• You shouldn't do Amway (I can guarantee you will fail).

You're welcome to disagree.

By the way, Dave, you're on my list.

Let me help you with that, Rob. Just copy and paste this onto your list:

[-]Dave A[/-] (Got his own business opportunity going already and very happy with it).
Will buy the toothpaste.

[B]NEXT![/B]

I must say this recent spurt of activity in this thread had me pondering (once again) just what the crux of the Amway controversy might be. And a relatively new perspective came to mind -

When you look at the investment, it really is no big deal once you get to a level making lots of money. But getting to some small gain, like an extra R2000 per month nett - it's an absolute monster.

If all you are looking for is an extra R2k per month (and I've got a story to tell on this, but another time as it's getting late) there are other, more favourable options.