Statistics and earnings

What is Network 21, scam or legitimate business? How much money can you earn in Amway? How does it work, really? What does the average person earn? The answer to these questions does not matter when you know the answer to the question: how likely are you to earn anything?

My favourite question to ask at a seminar is: how many people earned nothing or made a loss?
If they don't give you a straight answer walk away.

Amway is notorious for being deceitful and misrepresenting their figures and true earning potential for customers (IBOs). The Federal Trade Commission ordered Amway to stop retail price fixing and allocating customers among distributors and prohibited the company from misrepresenting the amount of profit, earnings or sales its distributors are likely to achieve with the business. Amway is required to accompany any such statements (if they do not, please notify the FTC or other such governing body) with the real averages per IBO / distributor, and should be easily available on their internet website.
They have been fined for breaching these terms before.

The fact is over 99% of people lose money in all MLM schemes.

Even by only supplying the average earnings, this is deceiving, as 1 high earner can raise the average of many other people making a loss. Given the resemblance to a pyramid type structure of the Network 21 and Amway business, it is a fact that ONLY mostly the people at the top make any money. This rule applies to any earnings claims from any top MLM company, including Usana Vitamins, Avon, Herbalife etc.

The nature of multilevel marketing schemes is that those towards the top of the pyramid (whose income is derived substantially from the sales efforts of several or perhaps many levels of IBOs below them) sell motivational courses and literature to people like you for their own profit (this is how they make the big bucks), directed at people in the lower levels of the pyramid, in the guise of support aimed at encouraging them to recruit more members and thus to extend further the base of the pyramid. Such material is known as Business Support Material (or "BSM"), which is what Network 21 provides, others call it the "tool scam".

Also the official earnings statistics figures they supply often also only state "active" members, further skewing the figures in their favour. If you were losing money in a business, how long would you continue to stay an active paying member? You would not, that would be stupid...but then again, you are talking about weird Amway people, where the make believe is possible. The fact is the number of non-active members is massive, people leave Amway all the time for good reason; because they are losing money.
Unfortunately the official figures given do not show the huge amount of people who are not considered active, or those who leave. If they did, the average earnings would be much worse than those publicly known, as shown below.

So now we know the "average" earnings is definitely not what most people earn, quite the opposite.

On top of this, the companies have been examined in court for their deceiving behaviour, and independent studies have been conducted. One by the Consumer Awareness Institute (based on Amway's own reports) stating that 99.99% of Amway IBOs lose money, also dont forget about all your expenses, let alone all that wasted time. That is, only 1 in 10,000 people in Amway make a single cent or dollar of money!

Now for an example. Consider how many people you see at the front of the stage at a Network Twentyone seminar conference who claim to be making 60,000 a month!
If you use the above figure of 1 in ten thousand make a profit, this means the average earnings are more like $6, as the average earnings are split over everyone.
For one person to earn a lot of money, many more make zero, or many people lose money.

Either way 9,999 people will lose money for just 1 to make more than 1 cent! Think about that.

If someone representing their company, or trying to seduce you to join claims how much money you can possibly earn, don't be fooled and suckered in by their wild claims, use your brain to clearly think about how they might be playing with the statistics. Instead invest in something where everyone makes money, not where everyone loses money.


Tex said...

Amway has ripped off millions of people for several decades, to the tune of 10s of billions of dollars.

Read about it on this website: and forward the information to everyone you know, so they don't get scammed.

Amway is a scam, and here's why: Amway pays out as little money as they can get away with, so they support the higher level IBOs ripping off their downline via the tool scam.

As a result, about 99% of IBOs operate at a net loss, while the top 1% make several TIMES more from their Amway tool scam than from the Amway products. This was made illegal in the UK in 2008, but our FTC is unable to pull their heads out of their butts to stop it here.

Joecool said...

Another good question is what are you likely to earn as an IBO? For the sake of this discussion, let's disregard IBOs who "do nothing".

An IBO who makes an effort is "likely" to move 100 PV, which costs $300, for which that IBO will get back about $10 and his/her uplines will split up about $80.

Business building IBOs are expected to attend functions, have voicemail, standing order, etc. These costs can run from $150 to $300, depdning on level of commitment.

Thus a typical IBO is likely to spend $300 on Amway products and another $150 to $300 on training materials (tools). So a typical IBO will spend $450 to $600 a month to be involved in Amway, and will eanr about $10 a month.

Someone not in Amway could probably get the same or similar product at WalMart for $150 to $200and although that person would not get any rebate, that person would not need any tools.

What's better? $200 spent monthly on products at WalMart or $450 tp $600 monthly spent on Amway and Amway training to get a $10 monthly return?

That's the typical IBO experience.

Anonymous said...

I got the whole concept about Network21, but i realy dont understand how 1 can make money out of this. do you have to constantly sell to make money or invite more people into your group. i realy want to join but i dont want to get into this with no better understanding

Mr Million said...

Above, you "really want to join" something that you have no idea how to (or even if) make money in? and statistically everyone pretty much actually loses money? Why would you want to join that?

The problem with their initial recruitment presentations and seminars is they focus on how much money you can make, but basically don't explain the system at all. Very deceptive.

I feel the reason is because they are embarassed & ashamed how overpriced the products are and how poor yet complicated the system is, with all it's points and diamond and emerald levels and so on.

Their sole purpose is making money off you! Never forget that.

A good money making system would sell itself. This doesnt.

The thing is, the training material directly teaches you to be deceptive when "showing the plan".

Anonymous said...

This is what I know about MLM. I'm not a big fan of MLM nor that I like it. Reading your blog is very funny.

Should you choose doing Amway:
No body force you to participate in any of those organizations. Even if they sponsor you, you can (humanly) build using your own way. Check with Amway - do they force you to participate in any of those (BWW, N21, eFinity, whatever)

Should you choose doing Amway:
Success is always for the few. In last World Cup 2010 in South Africa, how many winners do we have? It is always reserved for those who is willing to work and pay the price. Even if you are not in MLM, you should know this.

Should you choose doing Amway:
and you are not successful, is it Amway's problem? When you go to college and you don't pass an exam, is that the problem of the university? I don't see the logic.

My point is:
Again, I don't like MLM nor I endorsed any MLM. If you fail to do certain things, don't blame others. See it inside you. Until you do so, no success will ever come to you nor the satisfaction of achieving it.

Warm Regards,


Mr Million said...

Spoken like a true ignoramus. You're missing the point completely, and then compare it to some terrible non financial examples with completely different kinds of competition and resistance to success.

For one, you don't earn a degree or win a sporting competition depending on requiring recruited people under you. South Africa doesn't need Australia or India to qualify in their down line for them to win, they are their own (business) team, and their performance is completely in their own hands, they are not at the mercy and will of a parent company. Read Independent Business Owner?

Answer me this problem: If success is so elusive in this system, why would you pick this system to invest hard work in? There is no logic in that.

If I told you there was one investment where you had a 99% chance of making money for little effort, against another one that had 99% chance of losing money, and you had to work extremely hard, and bother a lot of people, which would you chose? If you pick do not pick the first then you clearly have no business sense or integrity, or intelligence; You would be perfect for N21 and Amway.

If you don't like multi level marketing, what are you doing spending hours on this site?