Amway income plan has hardly any expenditure listed on it! Is it, really possible to make money without investing time as well as money? No. So we should go through a process, where we understand how much it takes to become a 6% ‘qualified’ in Amway business. 6% pin level is supposed to be the stepping stone for success. Sooner you get it sooner your destiny can be reached. My up line had told me that in first 90 days, a new IBO should become an Eagle (three working legs earning six percent, 20 people in function and 10 Standing Order Tapes/Books – when I was an IBO). That can happen only if you become 6% by yourself in the first month. Of course I could not manage that even though I had 200+ personal PVs in one month, because sponsoring and getting new people to 100 PV in couple of weeks time is not that realistic.
I will talk in INR terms for currency and PV requirement is 300 to be called as six percenter. When I was an IBO, PV:BV ratio changed about 3 times. INR50 per PV (I had not signed up that time, but had the brochures with this ratio) became INR55 (when I actually signed up), then INR 60, and when I was leaving it became INR66. This increase by Amway was defended to make inflation adjustments so that you may have to work a little harder but you also get more income. So let us see how much is 300 PV worth, in simple multiplication mathematics it should be 300*66=INR19800. However, in the business plan no one tells you, or because it is a ‘unknown unknown’ for the prospects, that MRP-16%= DAP; DAP-12% tax = BV! That means 100PV will cost an IBO ~INR7700 and the actual business volume on which the commission calculated will be only ~INR6700! When you want to sell them, your price would be ~INR9300. When the plan was shown, first question would be how much is your monthly expenses on FMCG and consumables, and prospect would have told INR6000-INR8000, thinking about his food, grocery and regular household expenses. But if you look at the Amway products, it is only laundry and personal care products which will have cost per month of INR3000 if you buy luxurious necessities! Amway does not sell groceries and vegetables, INR8000 can never happen if you only change the shop but not adding products to your life. But you may end up buy unjustifiably expensive, skincare and supplements without which more than five hundred billion people on this planet live up till sixty years of age or more.
My assumption is the person who signs up for the business becomes core IBO in two weeks time (unrealistically positive)! Once an IBO is signed up he is expected to try all the products, in first two weeks of the business and you have spent ~INR7700 and if it was an individual only, you spent at least INR5000 out of your pocket! Let us assume he has signed up in the first week of the month itself, for simplicity. Now the IBO is trying to woo customers to make another 50PV and let us assume he succeeds, and he makes a profit of ~INR750. Meanwhile his references worked out and he finds three downlines in his LOS through his up line’s effort, which can happen in most cases. Let us assume it is in the second week of the business itself. So one of them puts all 100PV but the other two say that, they will buy products only after the salary! So new IBOs hopes get dashed! Let us move to next month, assuming that, he still remains core and wants to succeed in Amway. So he has to complete his 100PV by end of first week in the month, another ~INR7700 gone! Which means he has spent ~INR10000 without really having the necessity of consumption. Honestly speaking, none of the products bought in the previous month would have been finished. Still he has to buy!
In the next month he finds a couple more downlines, one to buy 100PV and other to buy 50PV but the person who bought 100PV last month is not buying anything because he is either – not interested, not having money, skeptical because he didn’t find anyone else, he just wants to sell some 50PV and then only will buy again, so on and so forth… But because this IBO already has personally bought 250PV in 6weeks in the business he can not buy for his personal usage anymore. Let us assume he finds another customer for 25PV and makes ~INR400 profit. But End of the month, runs out of money to get to 300PV. but ends again at 250PV second month complete. Let us assume, he has put in 15 hours a week for six weeks i.e. 90 hours and has also attended one BBS (business building seminar) and five open opportunity meetings and attended five home meetings in up lines house – in two months time this happens to any IBOs who are active; forget about the nine core steps are completely followed or not. In the second month he could have been advised to invest on some business building tools worth ~INR500 and also ~INR3000 for standing order program as per his trusted up line’s advise and with a goal to achieve Eagle qualification. All in all, this should add up to ~INR5000 including travelling charges and remind you 90hours effort.
In the third month, the core IBO is slightly worried because he has stocked up 175PV products and has only ~1150 profits to show. He does nothing and by the end of month somehow up line catches him to attend yet another major function and he spends ~INR2500 (does not buy a brand new suit for the function!). My up line used to tell me, after every major function, all core IBOs change pins. So, let us assume that, after the major function, this core IBO somehow sponsors four people afresh. In the following month, effectively fourth month after he signed up, and gets the IBOs in his LOS to do 200PV. With all his skill and effort, he manages to put another 150PV with retail profit of ~INR750. So he gets to 350PV and he receives 6% off ~INR23100 to make it ~INR1386 as Amway commission. We need to add the two more months of effort, so let us remain with Amway plan 12-15 hours a week, so another six weeks (assume he did nothing in two weeks before major function) 90 hours. After major function he attends four more open meetings, tries to help new IBOs and hence spends more on petrol etc., does buy at least ~INR1000 CDs and books to give to downlines.
Let us add the income first, ~INR750(first month)+~INR400(second month)+~INR750(fourth month) = ~INR1900 retail profits and add ~INR1386 from commission – let us assume best case scenario of INR3300 in revenue. He spent 90 hours in four months, in job he gets paid INR150 per hour so, let us assume his cost of time is ~INR13000. Excess consumption of products ~INR15000 and another ~INR12000 on tools, travelling expenses as listed above. So monetary investment of nearly INR30000 and return is INR3300 and they call it a business! Bu is there a fraction of asset which can yeild income in future? No.
What is so great Amway to begin with? Of course core IBOs know that nothing can happen in 12-15 hours of efforts in a week 🙂