Category Archives: Critics of Amway

1222 new Founder Platinums and above for Amway North America!

I saw a tweet from Jody Victor earlier today that was so incredible I had to confirm it before posting about it here –

What I needed to confirm was this was just for Amway North America. It seemed too small for Amway globally, but an almost unbelievable result for just Amway in North America. Well, Jody confirmed it. Amazing.

Just for fun, let’s see just how accurate that  a certain prolific anti-Amway blogger and obsessive has been over the past year –

Sep 1 2010 – I believe that Amway is shrinking in North America

Nov 29 2010 – It sure looks like Amway in the US and Canada is shrinking

Feb 11 2011 – it appears that Amway is shrinking in the US and Canada

Feb 12 2011 – I believe Amway is alreadu [sic] shrinking

Feb 28 2011 – it appears that Amway is shrinking in the US

May 24 2011 – especially in North America where Amway appears to be shrinking instead of growing.

June 23 2011 – I have heard recently that Amway and WWDB is shrinking in the US.

But don’t hold your breath expecting a little thing like reality to change his tune.  You’ll note three of the quotes above, in February 2011, were made just days after Amway revealed North American growth the previous year had been 5%. Who are you listening to?

Exciting times for Amway IBOs in North America – 1222 new Founders Platinums and above! Wow!

The bizarre world of Amway in India

For some years now I’ve been trying to write a post about the trials and tribulations of Amway India, and I never quite manage to get one done. It’s a struggle  just to sort through the bizarre allegations, unreadable and confusing legalize, and the truly bizarre misinformation of Amway’s critics.

Anyway, I’m trying again. As many readers might know, back in 2006 police in the Indian state of Andhra Pradesh raided and closed several Amway offices citing the “The Prize Chits & Money Circulation Schemes” law. Amway appealed to the courts, successfully, to remain open but their attempt to get the courts to once and for all declare the Amway business model legal and tell the police to stop harassing them failed. The court refused, instead stating that if the police allegations were correct, then the law would apply, so they ordered the police to complete their investigations within six months so their original allegations could be heard. Five years later that still hasn’t happened, and Amway critics in the country have spent the intervening time claiming the courts decision means Amway is illegal in India and lobbying for action. Of course, they conveniently ignore the part about the allegations needing to be correct! Unfortunately, similar events, and allegations, have now been made in the state of Kerala, and today it’s been reported that “The Enforcement Directorate” is investigating money laundering charges against Amway.

So what exactly are these allegations? It’s frankly a nightmare trying to sort through all the very oddly worded legal documents, but as best I can find from the original court hearing, here are some of them –

  • Amway’s membership fees are “quick and easy money” and no services are provided to distributors in return.
    Apparently the products and literature that come with the kit, the www.amway.in website, telephone support staff, dozens of  product centers throughout India, Media advertising, 14,000 support stuff throughout the world etc, etc etc don’t exist)
  • prescription of minimum level of 50 PV to qualify for getting commission is sufficient inducement for the members to relentlessly strive for maintaining the PV level at or above the said minimum levels.
    This requirement, which much of the world (including the FTC) cites as a reason that Amway is not a pyramid scheme, is to the Andhra Pradesh police a reason why it’s illegal! Having retail customer volume provides evidence that an MLM company has real products with real world demand. In the bizarro world Amway India lives in, it “forces” distributors to buy Amway products, giving Amway “automatic” income. The fact the vast majority of Amway distributors don’t actually do this thing it’s claimed they’re “forced” to “relentlessly strive for” is apparently irrelevant. Continue reading The bizarre world of Amway in India

Are you recruiting your competitors?

A supposed “criticism” of Amway, and indeed of multilevel marketing, that I’ve seen turn up regularly is the idea that it’s inherently flawed because “you are recruiting competitors”. For example, Robert T. Carroll, in his “Skeptic’s Dictionary” says –

Why, you might wonder would you recruit people to compete with you? For, isn’t that what you are doing when you recruit people to sell the same products you are selling? MLM magic will convince you that it is reasonable to recruit competitors because they won’t really be competitors since you will get a cut of their profits.

Australian MLM critic Peter Bowditch (ratbags.com.au) says for example regarding his own business compared with MLM –

I am a certified consultant and an authorised reseller for several software and hardware products. I can open a retail shop to sell these things, I can sell them on eBay, I can walk door-to-door around the neighbourhood, I can ask retailers to stock them and computer builders to include them as packages with their machines …I am not expected to find and recruit competitors for my business

Anti-Amway obsessive JoeCool comments on one of his (many) blogs –

 you are very strongly encouraged to RECRUIT YOUR OWN COMPETITION. If Amway were a business where the goal was to make money selling products, it is a suicidal business plan

So, what are they on about?

Well, the claim has some truth to it because when you sponsor someone in to your business, that person is indeed now a potential competitor for a retail customer. For any given customer, you’ll make more money if you sell to them personally than if your downline does.

One flaw in this “complaint” is that the same thing applies in traditional business as well. If you owned a small clothing store, every time you sell something, you get to keep all the profit. But what if you employ someone? In the clearest example, if you simply paid them on a commission basis, then they are a direct competitor to you on each retail sale. They get that commission instead of you. The same really applies even if they’re a salaried employee. The money your paying them could have stayed in your pocket if you hadn’t employed them and sold it yourself!

Or how about Coca-Cola? If you buy a coke from an official coca-cola vending machine then are you’re buying it direct from Coca-Cola. Yet you could also buy it from your local corner store. Every time Coca-Cola reps try to get a store to sell their products, they’re recruiting competitors!

Or let’s take Pete Bowditch’s own software example. As he mentioned, he could sell the software directly himself, or he could ask retailers to stock them. In other words – he could recruit a competitor! By having a reseller sell to a customer, that’s a potential retail sale he is missing out on.

Why does Coca-Cola recruit competitors? Why does a  small business owner recruit salespeople? Why does Bowditch suggest recruiting retailers?

No “MLM magic” is needed to answer that. It’s because you can make more money that way! By recruiting resellers, you can hopefully get much larger total sales volumes than by trying to do all the sales yourself. Yes, you’ll make less money per sale than if you did a sale personally, but you still get a percentage on the wholesale sale to your recruit, and you should be able to get a lot more sales for the same time invested. Asmaller percentage of a larger volume can easily be worth more than a larger percentage of a smaller volume. What’s more, the larger discount you get thanks to your recruit’s volume means you get an even bigger profit margin on your own retail sales!

Unless the marketplace for your products is saturated, and there is no room for expansion, recruiting other sales people to increase your sales volume is a smart and sensible way to increase your profitability.

Amway’s most prolific internet critic – what we already knew, confirmed.

Last month I hinted about some information proving the dishonesty of one of Amway’s most prolific internet critics. As I expected, that critic guessed who I was talking about and has attempted to cover his tracks. Alas, he hasn’t succeeded.

JoeCool is the (main) internet pseudonym of a former Amway and WWDB IBO by the name of Steve Nakamura. He’s based in Hawaii and has been literally obsessed with criticizing Amway since at least 2004. On the (now moribund) Quixtar Blog forums he has made over 6500 posts since 2004 (that’s more than 2.5 posts a day) and has been the originator of almost all new posts on that board for the last 2 years – most of the time by simply trawling the net for old posts critical of Amway, and reposting them.

In 2009/2010 alone, just on the two blogs he puts his “name” to, he published over 470 blog posts critical of Amway and at least a thousand comments on other Amway related posts on the internet. So far this year he has already published 90 posts just on the two “joecool” blogs. That’s nearly a post a day that he admits to.

The man is truly obsessed. Continue reading Amway’s most prolific internet critic – what we already knew, confirmed.

Amway critics and credibility – another one bites the dust

When you read stuff on the internet, it’s difficult to know what’s true and what’s not – generally all one can do is assess an authors credibility by what they say and how accurate it is. Everyone makes mistakes occasionally, but if people are making major errors of fact in their posts … well, it damages their credibility. If those errors are about what their entire post and/or blog is about, it damages the credibility of everything they post. Amway critics regularly try to damage the credibility of this site by attacking me (with often wildly inaccurate claims) rather than what I say and the information I present. It doesn’t matter, this site isn’t about me, I don’t care what you think about me – judge the credibility of what I write. Is it generally accurate? Do I backed it up by sources when I can? Judge what I write, not me. When someone resorts to ad hominem what it really does is reveal how little logical and factual basis the attacker has to try to discredit the other person – if you can’t attack the argument, attack the person. Continue reading Amway critics and credibility – another one bites the dust

Anatomy of Deceit – an Amway Critic’s price comparisons

I was having a discussion about Amway products and to my surprise the other party cited “JoeCool’s website” as evidence that Amway’s products were overpriced and not competitive – in other words, a scam. JoeCool is of course a well known anti-Amway zealot. So I thought I’d have a look at JoeCool’s price comparisons, and he was his usual dishonest self. This is JoeCool’s comparisons Continue reading Anatomy of Deceit – an Amway Critic’s price comparisons