What is Amway will be the focus of this article? Continue reading this article to know anything and everything about Amway.
This company is among the world's largest and oldest direct selling organizations. Using the term “distributors” or “independent business owners”, these entities generate billions of dollars annually. If you have a few minutes, take a look at their website at the Amway United States to learn more.
Similarly, look out for those who are Pro Amway as well as those who are highly critical of Amway.
The Amway organization is a multilevel network marketing organization. In order to show you a business plan, their distributors will come. Shall expound on dreams. They'll make you believe that you need to sell Amway in order to fulfill your dreams.
Amway is a multilevel marketing company that specializes in selling products. The millions of products sold around the world all work together thanks to the concept of agent appointment for each sale.
Instead of selling products through advertising on TV or other costly methods, it has adopted a unique approach.
Even in countries where the multilevel business is illegal, Amway has succeeded in doing it legally.
This concept comes from Amway:
The Amway distributors are the ones who sell through Amway. A distributor must perform two tasks:
Amway's products can be sold to people who live near them or within the locality.
They were also given the power to appoint under them Sub distributors who would sell their products to their local connections.
The parent distributor will get a share of each sub-distributor's sales, should the latter carry a product.
Marketing of this type is extremely successful at selling products like FMCG and other low-cost goods.
There is a large amount of profit potential for the distributor while providing him with a considerable amount of free time.
A number of home-based businesses follow this model: Amway is a multi-level marketing/drop-ship company that is the best in the industry. It has been around for over 60 years, and in that time it has achieved a great deal of success and earned widespread respect, despite the comments people leave on Quora.
Over the years, people who have tried to start their own businesses using Amway have made things look bad for the company and have disgraced themselves, but Amway itself is doing fine. The US and Canadian governments evaluate other drop-ship companies and their compensation plans by comparing them to Bullion Plus.
Amway provides quality products at reasonable prices, and the proceeds can be shared because businesses are operated through the company rather than paying money to big advertising firms and having products sold on store shelves.
The investigation took place in the 1970s and the conclusion was that the practise was neither illegal nor unethical.
Ada, Michigan, U.S., is home to our global operations; we're also present in more than 100 countries and territories around the world. In the decades since the four founder-provided Fundamentals and six company values first arose, much has changed. Additionally, we continue to be one of the world's largest family-owned companies—a significant attribute in 21st-century business.
The countless Amway Business Owners (ABOs) are our company's beating heart and soul. Every single thing we do is dependent on their success. Our intention is to help their aims, whether it's financial flexibility, personal freedom, or additional cash.
More than 15,000 people work in hundreds of locations around the world, and they are supported by our ABOs. We're extremely proud to be able to offer fantastic career opportunities to incredible talent from all over the world. Through work in agriculture, finance, technology, and education, our international team is helping to improve the lives of our customers, their families, and themselves.
We are motivated by the fact that our objective is uncomplicated. Our purpose is to help people lead healthier, happier lives. We use the values of partnership, integrity, personal worth, achievement, personal responsibility, and free enterprise to help us realize this belief in others.
The storey of founding a business is usually an entrepreneurial one.
Although both Rich DeVos and Jay Van Andel wanted more out of life for themselves, their families, and their friends, they approached it from different perspectives. Beginning in 1959, they started a new business together in their basements. Amway was created by them.
Amway has achieved the status of the world's leading direct selling company. Amway was founded on the belief that business ownership results in personal success and the ability to earn an income.
Successful and self-assured
Amway was founded by high school friends Rich DeVos and Jay Van Andel in Grand Rapids, Michigan. It was impossible for them to know that their separate lives would forever be entwined, or that their combined work would lead to enormous changes in the world of business.
Rich DeVos
DeVos was born in 1926 in a small town in Michigan called Ada, located outside of Grand Rapids. During his freshman year in high school, Jim attended Grand Rapids Christian High School, where he met Jay Van Andel, a young man who would go on to help start a philanthropic organisation. Rich then attended Calvin College, where he completed his undergraduate degree, and in 1944 joined the U.S. Army Air Force, serving until 1946.
In 1959, Rich teamed up with his friend and business partner, Jay Van Andel, to found Amway Corporation.
When Rich and his wife, Helen, made a donation to philanthropy in their hometown of Grand Rapids, they became all the more passionately involved in it. The donations made by Helen and Richard DeVos enabled the creation of a variety of institutions, including Helen DeVos Children's Hospital, the DeVos Communications Center at Calvin College, the DeVos Campus of Grand Valley State University, and the DeVos Place Convention Center and Concert Hall. Additionally, Rich was the owner and chairman of the NBA's Orlando Magic as well as other sports franchises, and he's also owned several others.
He passed away on September 6, 2018.
His son, Doug, co-president of Amway BOD.
Jay Van Andel
Jay Van Andel was born in Grand Rapids, Michigan, in 1924. He attended Grand Rapids Christian High School and met Rich DeVos, a young man. From 1942 to 1945, he attended Calvin College and Pratt Business School in Kansas and later served as an American Army Air Force officer.
In 1959, Jay and his good friend Rich DeVos co-founded Amway Corp.
As a lifelong advocate of free enterprise, Jay served between 1979 and 1980 as President of the U.S. Chamber of Commerce. He strongly supported community projects in the fields of economic development, health services, education and the arts. In his home town of Grand Rapids, he and his wife Betty founded the Van Andele Institute for Education and Medical Research. The generosity of Jay and Betty also helped create the Van Andel Arena and Van Andel Museum Center at the Public Museum of Grand Rapids.
Jay died on 7 December 2004.
His son, Steve, is the Amway BOD co-chairs.
Partnership legacy
Amway is a family-owned company that allows other families to thrive. Family is what makes us unique and relevant in several countries, cultures and generations. Our business was built on the relationship between two people and has grown into a partnership between their families, thousands of employees and millions of Amway owners. The founding families are committed to this enterprise and support these valuable partnerships over the next few years.
There are more than 50 family members today – and they are growing! To learn more about each branch, click through the Family Tree.
LEARNING, TOGETHER BUILDING
By the Generations
Amway was a family-owned company over 60 years old. As the business grew, four generations of founding members of the family, employees and business owners were welcomed. This series provides an overview of the significance of our values, live your passions, reflect differently and communicate in new ways. Join fathers and sons Dave & Aaron Van Andel and Doug & Dalton DeVos as they share their important lessons in business development at different times in our history.
Amway is an American Multi-Level Marketing Company (MLM) which sells health, beauty and home-care products. Jay Van Andel and Richard DeVos founded the company in 1959 and has its headquarters in Ada, Michigan. In 2019, Amway and its sister Alticor companies posted sales of $8.4 billion. It operates through a number of affiliates in over 100 countries and territories.
Amway has been investigated for alleged pyramid schemes in several countries and institutions such as the Federal Trade Commission (FTC) but was never found guilty, even though it paid tens of thousands of dollars to settle the suits.
Since school days and business partners, Jay Van Andel and Richard DeVos have been friends in various activities, including a hamburger booth, an air charter service and a boat company. In 1949, Van Andel's second cousin Neil Maaskant introduced them to the Nutrilite Products Corporation. In August, DeVos and Van Andel signed up for Nutrilite Supplements. They sold their first box for $19.50 the next day but for the next two weeks lost interest. They visited Chicago soon after, at the urging of Maaskant, their sponsor, to attend a Nutrilite seminar. They watched promotional films and listened to discussions from company representatives and successful distributors, followed by Nutrilite. On their return trip to Michigan they sold their second box of supplements and quickly developed the business further.
In 1949, DeVos and Van Andel formed the Ja-Ri Corporation for importing wooden goods out of South American countries (abbreviated by their first names). After the seminar in Chicago, Ja-Ri turned into a nutrilite distributor. Nutrillite also offered commissions on sales from new distributors introduced by existing distributors – a system known as multi-level marketing or network marketing – to the company, along with profits for each product sold. By 1958, DeVos and Van Andel had established an organisation with more than 5,000 dealers. In April 1959, however, in response to concerns about the stability of nutrilite and in order to represent distributors and look for additional products on the market, they and their leading distributors formed the American Way Association or Amway.
Their first product was Frisk, which a scientist from Ohio developed as a concentrated organic cleaner. DeVos and Van Andel purchased Frisk manufacturing and distribution rights and later changed the name into LOC (Liquid Organic Cleaner). They later formed Amway Sales Corporation for the procurement and inventory of products and for the handling of sales and marketing plans, and Amway Services Corporation for insurance and other distributor benefits. In 1960, they bought a 50% share in Detroit's Atco Manufacturing Company, LOC's original producers, and changed their name to Amway Manufacturing Corporation. The Amway Sales Corporation, Amway Service Corporation and Amway Manufacturing Corporation fusioned into the Amway Corporation in 1964.
Amway purchased control of Nutrilite interest in 1972 and full ownership in 1994.
International Development
Amway extended into Australia in 1971, Europe in 1973, Asia in 1974, Japan in 1979, Thailand in 1987, Thailand in 1995, Africa in 1997, India and Scandinavia in 1998, Ukraine in 2003, Russia in 2005, and Vietnam in 2008.
When Amway joined Alfa-Bank, a Russian loyalty card programme called "Alfa-Amway" was created in 2014.
In 2018, Forbes placed Amway as the 42nd largest private company in the United States and the number one company in 2018 on the Global 100 Direct Selling News list.
Quixtar
A new holding company named Alticor was founded in 1999 and three new companies were launched: the sister (and separate) internet-focused firm Quixtar, the Access Business Group, and Pyxis Innovations. Pyxis was later replaced by Fulton Innovation and pursued R&D, and for Amway, Quixtar and third-party customers, Access Business Group handled manufacturing and logistics.
The big difference was that "independent business owners" (IBOs) were able to order directly from Amway via the Internet instead of from their "direct distributor." The name Amway was still used in the rest of the world. After almost all Amway distributors switched to Quixtar in North America, Alticor opted to close Amway North America in 2001. In June 2007 it has been announced that over an 18- to 24-month period, the Quixtar brand would be phased out in favour of a global Amway brand (Amway Global).
In 2006 Quixtar issued The Quixtar Independent Business Owner Compensation Plan, reporting that "Active" IBOs have an average gross monthly income of $115.
Global markets global markets
Amway website reports that since 2011, the company operated in more than 100 countries and territories and organised into regional markets: the Americas, Europe, China, Japan and Korea and SE Asia/Australia. The top ten of Amway's markets are China, Korea, Japan, Thailand, Taiwan, India, Russia, Malaysia and Italy.
In 2008, Alticor announced that the company reported sales growth in two-thirds of the 58 markets, including strong growth in the markets of China, Russia, Ukraine, and India.
Australia Amway
Amway Australia is the Amway affiliate serving Australia and New Zealand. The company started in 1971. Amway is a multi-level marketing company.
Amway Australia opened in April 1971 and was Amway's first non-North American market. The company launched quickly and in its first month of operation registered over 400 distributors, but sales soon stagnated. Research revealed quality control problems for local manufacturers and decided to manufacture and ship Amway products from the US headquarters. By 1993, sales of wholesale amounted to A$ 148 million. In that year, Amway Australia joined Amway Asia Pacific, a public-listed company and had sales of A$198 million by 1998, with over 100,000 distributors selling more than 2,500 products. In 2000, Amway Asia Pacific was returned by New AAP Limited, a Bermuda company, to private ownership.
The first internet based ordering system (ELVIS - Electronic Link Via Internet Services) was launched in March 1998 and sales for Amway Australia amounted to $15.9 million in July 1998. ELVIS was replaced by a2k in April 2000, and Amway Australia became one of Amway's first affiliates to introduce a new business model called IMC (where the "I" stands for Independent Business Owner [IBO], the "M" stands for a new Member classification, and "C" stands for Client). The new portal provided access to various partner companies' products along with Amway products, including IBM, Petals, RM Williams, Blue Star Office Supplies and AFS Financial Services. In 2000, Amway was reported to be the largest direct selling firm in the Australian region with over $170 million in sales annually and a network of 100,000 home-based distributors. Thirty percent of Amway's products are sold by Australian suppliers and the rest by Amway factories in the United States, Europe and Asia.
By 2010, 40 percent of Amway's members were under the age of 30 and the company used social media like Facebook and Twitter to sell and communicate and also increased the marketing efforts of brands by signing a backing deal with swimmers Libby Trickett and Australian cricketer Adam Gilchrist as "ambassadors."
The "direct sales" company has been hardened for decades by allegations that it is an illegal pyramid scheme. Amway's President told Australian media that "this is old news."
Mr. Scully asked the Minister for Consumer Affairs in 1994 if Amway Australia's distribution practises were dishonest, unethical and inappropriate. "Complaints against Amway or Amway distributors are very few and show little cause for concern" replied the Minister of Consumer Affairs. Following a complaint from Amway, the Department had brought a misleading behaviour of one of Amway's distributors involving Amway's potential recruitment to another work-at-home scheme.
In 2003, the Australian Tax Office challenged deductions for seminary expenditures offered to successful distributors by Amway Australia over an 8-year period. Amway had a partial win with Amway's Federal Court ruling that he had a large right to the deduction, but it was ruled that substantial food and beverage bills related to the seminars were not deductible. This ruling was overturned in 2004 and the deductions were fully allowed because it was a serious business opportunity.
Chinese Amway
Amway China started in 1995. In 1998 the Chinese Government issued a prohibition on all direct selling companies, including Amway, following abusses of illegal pyramid schemes which led to riots. Following the negotiations, some companies like Amway, Avon and Mary Kay continued to operate through an independent sales force network of retail outlets. China introduced new direct sales legislation in December 2005, and Amway was one of the first companies to receive a direct sales licence in December 2006. Unlike in the US, however, teachers, doctors and officials are forbidden by legislation to become direct sales officers of the company and salespeople in China are not eligible to receive commissions from the dealers they recruit.
Amway China reported an annual sales figure of 180,000 in 2006, 140 stores and $2 billion. In 2007, Amway Greater China and Eva Cheng, Southeast Asia's Chief Executive Officer, were ranked 88th among the most powerful women of the world by Forbes magazine. In 2008, China was Amway's largest market with 28 percent growth and 17 billion yuan (2.5 billion US dollars) sales. According to the April 2010 Bloomberg Business Week report, Amway had 237 Chinese retail stores, 160,000 direct sales officers and revenues in the sum of $3 billion.
Brands
The product line of Amway grew from LOC, added in 1960 with the SA8 laundering detergent and later the Satinique hair treatment product (1965) and the Artistry cosmetics line (1968). Today Amway produces more than 450 products and produces plants in China, India and the United States, together with Nutrilite organic farms in Brazil, Mexico and the United States (California and Washington state). Amway brand name includes Artist, Atmosphere, Body blends, Bodykey, Body Works, Clear Now, Glister, iCook, Legacy of Clean, Nutrilite, Peter Island, Perfect Empowered Drinking Water, personal accents.
Nutrition and health products accounted for 52% of total sales in 2018, and beauty and personal care products accounted for 26% of total sales.
Cleaners household
Amway is better known in North America for its original LOC, SA8 washer detergent and Dish Drops liquid for multi-purpose cleaning. SA8 was rated the best-performing washing detergent in the January 2007 issue of Consumer Reports with Bioquest. However, Consumer Reports criticised the price of SA8, a situation disputed by Amway. Blind testing of clean detergents was carried out in 2010 and Amway's legacy versions of clean detergents were ranked 9th and 18th of the 20 detergents tested. Pat Slaven, the manager of the Consumer Reports programme, recommended that products not be bought because consumers can "go to the grocery store and get something that is far better for much less."
Beauty and health
Amway's brands include Arts, Satin, Hymm, Body Series, Glister, Moiskin, South America, Nutrilite, Nutriway, Attitude, India, eSpring, Atmosphere and iCook, as well as the drinks XL and XS Energy. Tolsom, Eddie Funkhouser New York, or beauty cycle are other Amway brands which have been discontinued and replaced (Eastern Europe).
Artistry
Artistry is an Amway brands of skin care and cosmetic products, based in Ada, Michigan, which sell in over 50 countries and territories worldwide to Amway Business Owners.
Background
Edith Rehnborg, Nutrilite founder Carl Rehnborg's wife, founded the artistry of Edith Rehnborg Cosmetics in 1968.
In 1972, Nutrilite merged with Amway, giving Amway control of the brand Artistry.
The brand has been expanded to Australia, Hong Kong, Malaysia, the Netherlands, the United Kingdom and West Germany on an international scale.
Artistry products were produced by Nutrilite in California in 1980 and also by Amway in China in 1995.
Over the years, Artistry has expanded its portfolio of products. As of 2000, more than 400 products were included in the Artistry range.
Partnerships
Artistry Cosmetics was the official sponsor of Skate Canada and the Skate Canada national team in May 2007 for their skin care and cosmetics events.
A partnership between the brand and actress Sandra Bullock as Artistry Creme LuXury was established in 2008.
The Miss America contest was sponsored by Artistry and Amway in 2010.
The brand also has partnerships with the Oscars events, New York Fashion Week.
the Busan Film Festival, and Teresa Palmer and Rick DiCecca.
Awards and awards
The Artistry Essentials skincare company won the 2007 AmeriStar Package Competition in the health & beauty sports category
Artistry Créme Luxury has won the Skin Care Prestige category in the IPDA (International Package Design Award) in 2008 and has been nominated for the 2009 United Kingdom Beauty Award as a finalist in the Best New Skincare Product of the Year category.
Nutrilite
Amway's biggest brand is the Nutrilite range of health supplements (marketed in some countries as Nutriway), with sales of over $3 billion worldwide in 2008.
In 2001, NSF International issued its first five certificates for nutrilite dietary supplements.
In 2011, Amway's sales by Nutrilite's brand of vitamins and dietary supplements amounted to nearly $4.7 billion.
According to Euromonitor International, the world's No. 1 vitamin and food supplement brand was nutrilite in 2014. According to Euromonitor International, Amway was the largest vendor of vitamins and dietary supplements in China in 2015, with 11% of a market that generated 100 billion yuan (15,6 billion dollars) in sales annually. In 2015, Amway Nutrilite was the most popular vitamin and dietary supplement brand in China according to the China Confidential Consumer Brands Survey.
In January 2009, Amway announced its voluntary recall of Nutrilite and XS Energy Bars after learning that they may be manufactured from Peanut Corporation of the Americas using salmonella-contaminated ingredients. The company indicated that it had not received any disease reports related to the products.
In 2012, Amway was charged with making unsubstantiated and illegal claims on 2GO twist tubes for Nutrilite Fruit & Vegetables by the Center for Science in the Public Interest (CSPI) and threatened to bring a clashes suit against the company without corrective action.
Amway replied that the products claims had been properly justified and did not plan on changing the product label, but would nevertheless review the statements questioned by CSPI.
CSPI subsequently reported that Amway agreed to change product labels by the end of 2014.
Nutrilite is a mineral, vitamin and dietary supplement brand which Carl F. Rehnborg developed in 1934. Nutrilite products are currently manufactured by Access Business Group, Alticor's subsidiary whose products are sold worldwide via Amway. In Denmark, Finland, Norway, Sweden, Turkey, Australia, and New Zealand, the Nutrilite brand is known as Nutriway.
In the 1930s, Carl F. Rehnborg developed his vitamin products. During his time in China between late 1915 and 1927, he experienced the role of vitamins and nutrients in his overall health. He started selling his vitamins as a Vitamin Company in California and renamed them Nutrilite in 1939. In 1945 he invented a system of multi-level marketing to distribute his vitamins. In 1945 Lee S. Mytinger and William S. Casselberry, two men became exclusive national distributors and operated a vitamin distribution company.
Amway founders Jay Van Andel and Richard DeVos began selling Nutrilite products as independent distributors in 1949, when the previous retailers (Mytinger and Casselberry, Inc.) had been involved in a conflict with the FOODA, which charged them with false advertising. They quickly grew to be top-selling dealers. Van Andel and DeVos, concerned with the FDA dispute, launched the American Way, (later called Amway), which is the new company, to use a multi-level marketing system for other household products. In the 1960s, the dispute between the FDA/Mytinger-Cassleberry and the US Supreme Court was resolved in favour of the FDA.
In 1972, Amway acquired a controlling interest in the company, and in 1994, the company was completely acquired by Amway.
In 2001, five Nutrilite products became the first dietary supplements to be certified by NSF International, marking a significant milestone in the industry.
The Simply Nutrilite (later renamed Nutrilite Trim Advantage Body System) line of supplements was introduced in 2007 to the market. Meal replacement bars, anti-oxidant supplements, and vitamin supplements are all part of the line.
Throughout North America, as well as 108 other countries and territories, Nutrilite's vitamin and mineral products are distributed exclusively by Amway affiliates known as Independent Business Owners (IBO). Alticor is the parent company of Amway, Quixtar, and Access Group, among other companies.
Asafa Powell, Liu Xiang, Sanya Richards, Ronaldinho, and Jenn Stuczynski have all served as spokespersons for the brand over the years.
eSpring
Amway's eSpring water filter first appeared on the market in 2000. In the words of Amway, it was the first system to combine a carbon block filter and ultraviolet light with electronic-monitoring technology in the filter cartridge, and it was the first home system to achieve certification for ANSI/NSF Standards 42, 53, and 55, among other things. According to Amway, the eSpring water treatment system was the first to be certified for all fifteen NSF/ANSI 401 contaminants, which include pharmaceuticals, pesticides, and herbicides, among other contaminants. eSpring is also certified for more than 145 potential contaminants, according to the company, in addition to the 15 listed above. These contaminants include lead and mercury, among others.
A wireless power induction technology developed by Fulton Innovation, eSpring was the first commercial product to make use of the technology. It was announced in December 2006 that Amway subsidiary Fulton Innovations would introduce eCoupled technology in other consumer electronic products at the 2007 Consumer Electronics Show, which took place in January 2007. Visteon, Herman Miller, Motorola, and Mobility Electronics are among the companies that have licenced this technology. Fulton was a founding member of the Wireless Power Consortium, which was responsible for the development of the Qi wireless charging standard (inductive power standard).
Consumer Reports ranked eSpring fifth out of 27 water filter brands in a comparison of water filters published in 2007. In a Consumer Reports comparison of countertop models in 2012, eSpring received 94 points (out of a possible 100 points) – the highest score among countertop models and the third highest score among 18 brands.
In Malaysia, eSpring was recognised as a Reader's Digest Trusted Brands Award winner in the category of water purifiers in 2013. After winning the award for the sixth consecutive year in 2014, Amway was named Asia Pacific Water Filtration Company of the Year by Frost & Sullivan in 2015. An Amway-commissioned study of global sales conducted by marketing research firm Verify Markets found that eSpring was the world's most popular brand of kitchen water treatment systems and home water treatment systems in 2014.
XS
Announcing the acquisition of XS Energy, a California-based brand of energy drinks and snacks, Amway made the announcement on January 14, 2015. Since 2003, the XS Energy brand has been distributed by Amway as a consumer product. Currently, it is distributed in 38 countries and generates annual sales of $150 million, according to data from January 2015.
Globally, according to Euromonitor International, the XS Energy brand was the first exclusively sugar-free energy drink brand to be introduced into the market.
The same goes for delivery.
Ditto Delivery is Alticor's automatic, monthly replenishment programme that fills orders based on the needs of customers who have predetermined their requirements. Ditto Delivery accounted for 30 percent of Quixtar's North American sales as of May 2001, according to the company.
Model of the company
Amway combines direct selling with a multi-level marketing strategy to create a successful business. Amway distributors, also known as "independent business owners" (IBOs), have the ability to market products directly to potential customers, as well as sponsor and mentor others who wish to become IBOs themselves. The retail markup on any products they personally sell, as well as a performance bonus based on the sales volume generated by them and their downline (IBOs they have sponsored), are all sources of income for IBOs. People may also register as IBOs in order to purchase products at a discounted price. It was noted by Harvard Business School that Amway founders Van Andel and DeVos "attained their success through the use of an elaborate pyramid-like distribution system in which independent distributors of Amway products received a percentage of the merchandise they sold as well as a percentage of the merchandise they sold to other independent distributors of Amway products." Amway has been described as "one of the world's most profitable direct selling companies."
Sponsorships from commercial enterprises
Alticor Corporation was awarded the naming rights to the Orlando Magic's home basketball arena in Orlando, Florida, in December of 2006. The DeVos family is the majority owner of the Orlando Magic. The Amway Arena replaced the TD Waterhouse Centre, which had previously been known as the TD Waterhouse Centre. The Amway Center, which replaced it, opened its doors in 2010, and the older arena was demolished the following year.
Amway Global signed a three-year deal with the San Jose Earthquakes Major League Soccer team in 2009 to become the team's jersey sponsor. The deal was announced in 2009.
Amway Global signed a multi-year agreement with the Los Angeles Sol of Women's Professional Soccer in March 2009 to become the team's official presenting sponsor. The agreement, however, would only last a year, as the Sol went out of business in 2010.
In 2011, Amway agreed to a three-year agreement to serve as the presenting sponsor of the Detroit Red Wings of the National Hockey League.
Since 2012, Amway has served as the title sponsor of the Canadian Championship, a soccer tournament held every year in Canada.
Politics and culture are intertwined.
Contributions to political campaigns
During the 1990s, the Amway organization was a major contributor to the Republican Party (GOP) and to the election campaigns of a number of Republican candidates for governor and senator. In 1994, Republican congresswoman and Amway distributor Sue Myrick (North Carolina) raised $669,525 through the efforts of Amway and its sales force. According to two reports in Mother Jones magazine, Amway distributor Dexter Yager "used the company's extensive voice-mail system to rally hundreds of Amway distributors into giving a total of $295,500 to Sue Myrick's political campaign in 1994." The magazine reported that Myrick had been a regular on the Amway circuit, speaking at hundreds of rallies and selling $5 and $10 audiotapes, according to a campaign staffer who was quoted in the magazine. Despite having lost the 1994 election, Myrick maintained "close ties to Amway and Yager," and in the 1997–98 election cycle, he received $100,000 in contributions from Amway sources, "most notably through fundraisers at the homes of large distributors."
In October 1994, Amway made the largest corporate contribution ever recorded to a political party for a single election, donating $2.5 million to the Republican National Committee (RNC). At the time, Amway was the largest corporate political donor in the United States, outpacing all other corporations combined. During the 2004 election cycle, the organisation made a total of $4 million in contributions to Progress for America, a conservative 527 organisation.
During a $3 million fundraiser for the Republican Party in July 1996, Amway co-founder Richard DeVos was honoured, and a week later, it was reported that Amway had attempted to donate $1.3 million to pay for Republican "infomercials" and telecasts of the GOP convention on Pat Robertson's Family Channel, but had backed out after Democrats criticised the donation as a ploy to avoid campaign-finance restrictions.
Richard DeVos and his wife, Helen, made a $1 million donation to the Republican National Committee in April 1997, which at the time was the second-largest soft-money donation in history, trailing only Amway's $2.5 million gift to the RNC in 1994. During the final hours of a hotly contested compromise tax bill in July 1997, Senate Majority Leader Trent Lott and House Speaker Newt Gingrich slipped a last-minute provision into the bill that granted Amway and four other companies a tax break on their Asian branches totaling $19 million.
Reporter Molly Ivins wrote in an August 1997 column for the Fort Worth Star-Telegram newspaper that Amway had "its own caucus in Congress...Five Republican House members who are also Amway distributors are Reps. Sue Myrick of North Carolina, Jon Christensen of Nebraska, Dick Chrysler of Michigan, Richard Pombo of California, and John Ensign of Nevada. Their informal caucus meets several times a year."
According to a Businessweek investigation of campaign contributions conducted in 1998, Amway, along with its founding families and some of its top distributors, had donated at least $7 million to Republican causes in the decade preceding the election. Candidates for political office who received campaign funding from Amway in 1998 included Representatives Bill Redmond (R–New Mexico), Heather Wilson (R–New Mexico), and Jon Christensen (R–Nebraska).
According to a report published by the Center for Public Integrity, members of the Van Andel and DeVos families were the second, third, and fifth largest donors to the Republican Party during the 2004 election cycle.
From 1996 to 2000, and again from 2003 to 2005, Amway founder Richard DeVos' son Dick DeVos served as Finance Chairman of the Republican National Committee, and his wife Betsy DeVos served as chair of the Michigan Republican Party. Dick DeVos is a former president of Amway.
Dick DeVos ran against incumbent Governor Jennifer Granholm in the 2006 gubernatorial election in Michigan, which was held in May 2005. Granholm defeated DeVos in the popular vote, garnering 56 percent of the vote to DeVos' 42 percent.
In August 2012, gay rights activist Fred Karger launched a campaign to boycott Amway in response to a contribution made by Amway President Doug DeVos' private foundation to the National Organization for Marriage, a political organisation that opposes the legalisation of same-sex marriage in the United States.
On February 7, 2017, the Senate confirmed Betsy DeVos to be the 11th Secretary of Education, making her the first woman to hold the position.
Religion
Mother Jones magazine described the Amway distributor force as being "heavily influenced by the company's dual themes of Christian morality and free enterprise" and operating "like a private political army." Several sources have commented on the promotion of Christian conservative ideology within the Amway organisation.
Stephen Butterfield, who worked for a time in the Yager group within Amway, wrote in The Cult of Free Enterprise that "[Amway] sells a marketing and motivational system, a cause, a way of life, in a fervid emotional atmosphere of rallies and political religious revivalism."a City Paper correspondent Maryam Henein stated that "the language used in motivational tools for Amway frequently echoes language used in religious revivalism."
In a piece for Businessweek, correspondents Bill Vlasic and Beth Regan described the founding families of Amway as "dedicated conservatives, devout Christians, and enormously influential in the Republican Party," noting that "Rich DeVos charged up the troops with a message of Christian beliefs and rock-ribbed conservatism."
High-ranking Amway executives, including Richard DeVos and Dexter Yager, were owners and board members of Gospel Films, a producer of movies and books geared toward conservative Christians. They were also co-owners (along with Salem Communications) of Gospel Communications International, a right-wing Christian nonprofit that advocated for the rights of women and children. On 60 Minutes in 1983, Yager admitted that he promotes Christianity through his Amway group, but stated that this may not be the case in other Amway group [requires quotation to confirm.].
Former Amway CEO and co-founder Richard DeVos, according to Rolling Stone's Bob Moser, has ties to the Dominionist political movement in the United States, according to the publication. According to Moser, DeVos was a supporter of the late D. Eisenhower. James Kennedy has donated more than $5 million to the Coral Ridge Ministries, which is run by Kennedy. DeVos was also a founding member and two-time president of the Council for National Policy, a conservative Christian organisation with a right-wing political agenda.
David G. Bromley, a sociology professor, describes Amway as a "quasi-religious corporation" with sectarian characteristics. Despite the fact that some critics have referred to organisations such as Amway as "cults" and speculated that they engage in "mind control," Patralekha Bhattacharya and Krishna Kumar Mehta of the consulting firm Thinkalytics, LLC, believe that there are other explanations that could account for the behaviour of distributors. It is possible that distributors will continue to participate despite receiving a low economic return as a result of social satisfaction compensating for the loss of economic satisfaction.
A business organisation that promotes trade and commerce.
Jay Van Andel, co-founder of Amway, and later his son Steve Van Andel, were both elected by the board of directors of the United States Chamber of Commerce to serve as chairman of the private American lobbying organisation. Jay Van Andel was elected in 1980, and Steve Van Andel was elected in 2001.
A programme for accreditation
As a response to concerns about business support materials (BSM), including books, tapes, and meetings, Amway (then Quixtar in North America) established the Professional Development Accreditation Program in 2006. In 2010, this was replaced by the Accreditation Plus programme, which ensures that all BSM content is consistent with Amway's quality assurance standards, which approved providers must adhere to. That is specifically stated in the quality assurance standards.
Improperly advocating for political causes or other issues of a personal nature in the Amway Business environment is strictly prohibited. Presenters may not use the stage as a platform to promote religious and/or personal social beliefs, and they may not use the stage to deliver a message or focus that includes spiritual references.
Unless it is specifically related to the operation of an Amway Business, it is not permitted to express support for or opposition to specific candidates, political parties, and/or issues in general.
Allegations of a pyramid scheme
Amway has been described as a "legal pyramid scheme" by Robert Carroll of the Skeptic's Dictionary, who also claims that the company uses the quasi-religious devotion of its affiliates to conceal poor performance rates by distributors.
The Federal Trade Commission is conducting an investigation.
The main article is titled In re Amway Corp.
In a 1979 ruling, the Federal Trade Commission determined that Amway did not meet the definition of a pyramid scheme because (a) distributors were not compensated for recruiting others, (b) distributors were not required to purchase a large stock of unsold inventory, (c) distributors were required to maintain retail sales (at least 10 per month), and (d) the company and all distributors were required to adhere to the Amway Code of Conduct and Ethics.
It was found guilty of price-fixing and making exaggerated income claims by the Federal Trade Commission, which ordered Amway to cease and desist from allocating customers among distributors and to refrain from misrepresenting the amount of profit, earnings, or sales that its distributors are likely to achieve with the business. As an example, the court ordered Amway to include the actual averages per distributor with any such statements, noting that more than half of the distributors do not make any money, with the average distributor earning less than $100 per month. A 1986 advertising campaign was found to have violated the order, resulting in a $100,000 fine.
Independent consumer watchdog agencies have found that between 990 and 999 out of every 1000 people who join multilevel marketing companies that use Amway-style compensation plans actually lose money. Several sources state that the Federal Trade Commission requires Amway to label its products with the message that 54 percent of Amway recruits make nothing and the remainder earn on average $65 a month, according to The Skeptic's Dictionary.
Amway India is a multinational corporation.
After receiving a public complaint, the Andhra Pradesh and Telangana state police (CID) conducted raids and seizures against Amway distributors in the state, and filed a petition against them, alleging that the company had violated the Prize Chits and Money Circulation Schemes (Banning) Act. They also closed down all corporate offices associated with the Amway organisation, including the offices of so-called "Amway distributors." Amway is primarily concerned with making money through the recruitment of people to become distributors, rather than the sale of products. In 2008, the state government of Andhra Pradesh enacted a ban on Amway media advertisements.
Following complaints, the Kerala Police sealed the offices of Amway in Kozhikode, Kannur, Kochi, Kottayam, Thrissur, Kollam, and Thiruvananthapuram on August 6, 2011, according to the Kerala Police. Following a crackdown on money-laundering activities, the Kerala Police's Economic Offences Wing conducted searches at Amway offices in Kozhikode, Thrissur, and Kannur in November 2012 as part of its ongoing money-laundering investigation. The firm's warehouses in these cities were also closed down. Also seized were products with a total value of 21.4 million rupees (approximately US$400,000 at the time). P. M. Rajkumar, an Amway area manager who was arrested after searches were conducted, was later remanded in judicial custody for a period of 14 days.
On May 27, 2013, officials from the Kerala Police's Crime Branch apprehended William S. Pinckney, the Managing Director and CEO of Amway India Enterprises, as well as two other directors of the company, all of whom were from Kozhikode. The three were taken into custody on suspicion of running a pyramid scheme. They were released on bail the following day, and the company continued to operate normally. The freeze on Amway offices in Kerala was lifted on June 8, 2013, by the Kozhikode High Court. Pinckney was arrested by the Andhra Pradesh police on May 26, 2014, on the basis of a consumer complaint alleging that Amway was engaging in unethical money circulation practises. He was later apprehended in connection with other criminal cases filed against him in the state, which were based on allegations of financial irregularities by the company. Pinckney was imprisoned for two months before being released on bail after pleading guilty.
Amway India's William Scot Pinckney and Prithvai Raj Bijlani were charged with violating Section 420 of the Indian Penal Code as well as the Prize Chits and Money Circulation Scheme (Banning) Act in 2017. The charges were filed in 2017 by a Chandigarh court on their behalf. This was based on a cheating case filed by eight complainants in 2002, which resulted in the Economic Offences Wing filing a chargesheet against the defendants in 2012. Despite their efforts, the two Amway executives were unsuccessful in their attempt to have the charges against them revised.
Settlement of a class action lawsuit in the United States
A class action lawsuit against Amway was filed in Federal District Court in California in 2007, and the company announced on November 3, 2010, that it had agreed to pay $56 million ($34 million in cash and $22 million in products) to settle the case. The class action lawsuit, which was filed against Quixtar and several of its top-level distributors, claimed that the defendants engaged in fraud and racketeering, as well as that they operated an illegal pyramid scheme.
Amway acknowledged that it had made changes to its business operations as a result of the lawsuit, while emphasising that the settlement does not constitute an admission of wrongdoing or liability on the part of the company. A decision on the settlement is contingent on approval by the court, which was expected in early 2011. Including the changes Amway made to its business model, the settlement has an economic value of $100 million, which is included in the settlement.
In Canada, you can file a class action lawsuit.
A class action lawsuit filed in Canada in 2009 was dismissed by the Federal Court and upheld on appeal by the Federal Court of Appeal, with Amway awarded costs and the plaintiffs ordered to arbitrate their claims.
Lobbying for the deregulation of the market
An amendment to the US House of Representatives' omnibus Financial Services and General Government Appropriations bill for fiscal year 2018 proposed by US Representative John Moolenaar would have limited the ability of the Federal Trade Commission to investigate whether multilevel marketing companies are pyramid schemes. The DeVoses supported the amendment. As a result of this amendment, no funds would have been available for enforcement actions against pyramid operations by the Treasury Department or Justice Department or Small Business Administration or Securities and Exchange Commission or the Federal Trade Commission during the current fiscal year. Furthermore, provisions from H.R. 3409, the so-called "Anti-Pyramid Scheme Promotion Act of 2016," which would blur the lines between legitimate MLM activity and pyramid schemes established under the original 1979 FTC case by deeming sales made to people within the company as sales to a "ultimate user," thus erasing the key distinction made in the ruling between sales to actual consumers of a product and sales to people within the company, were adopted. Several consumer advocacy organisations, including Consumer Action, the Consumer Federation of America, the Consumer Reports magazine publisher Consumers Union, Consumer Watchdog, the National Consumers League, and the United States Public Interest Research Group (US PIRG), as well as Truth in Advertising (TINA.org) in its original form, were vocal in their opposition to the amendment, which was passed by the House of Representatives.
Other legal actions are being pursued.
In the case of Canadian tax fraud
Several criminal charges were brought against Amway co-founders Richard M. DeVos and Jay Van Andel, as well as Amway's executive vice president for corporate services, William J. Mr. Discher Jr., during an indictment in Canada in 1982. Among the charges were allegations that they had underreported the value of goods brought into the country and had defrauded the Canadian government of more than $28 million between 1965 and 1980.
The charges against Amway and its Canadian subsidiary were dropped in 1983 after Amway and its Canadian subsidiary pleaded guilty to charges of criminal customs fraud. The companies agreed to pay a fine of $25 million CAD, which was at the time the largest fine ever imposed in Canada. In 1989, the company paid a total of $45 million CAD to settle the outstanding customs duties. Despite believing they were innocent of the charges, DeVos wrote in a 1994 article that the guilty plea had been entered for "technical reasons," and that he believed the case had been motivated by "political considerations."
The RIAA has filed a lawsuit.
A lawsuit against Amway and several distributors was filed in 1996 by the Recording Industry Association of America (RIAA) as part of its anti-piracy efforts. The RIAA claimed that copyrighted music was being used on "highly profitable" training videotapes. A $9 million settlement was reached outside of court after Amway denied any wrongdoing and blamed the case on a misunderstanding among distributors. [146] Earlier this year, the Court ruled in a related lawsuit brought by the videotape distributors that Mahaleel Lee Luster, who had been contracted to produce them, had violated copyright without the knowledge of three of the five distributors involved.
Amway United Kingdom
The United Kingdom and Ireland's Department of Trade and Industry closed Amway's operations in 2007 after a year-long investigation. The Department of Trade and Industry sought to have Amway banned on the grounds that the company had engaged in deceptive marketing, presented inflated earnings estimates, and lured distributors into purchasing bogus "motivation and training" tools.
Government claims against Amway's operations were dismissed by a UK judge in 2008, stating that major reforms implemented the previous year (including the prohibition of non-Amway-approved motivational events and materials) had corrected company flaws that favoured the sale of training materials over products and falsely represented earnings. The judge, on the other hand, expressed his belief that Amway had tolerated "misrepresentations" of its business by independent sellers in the past and had failed to take decisive action against the misrepresentations at the time.
Welcome to the Real World (Poland)
Following the release of the Polish film Welcome to Life (Polish: Witajcie w zyciu) in 1997, Amway Poland and Network TwentyOne filed separate lawsuits against the film's producers for defamation and copyright violations. The director, Henryk Dederko, as well as the producer were later found not guilty of the charge of disseminating false information. The film, which had been banned for 12 years, was one of the most highly anticipated films at the 2009 Warsaw Film Festival, where it was dubbed a "scary movie about brainwashing" by the festival's promoters. It was claimed to depict hard-sell "pep rallies," and to include statements from distributors claiming that meetings had a similar tone to meetings of the Communist Party in Poland before the Communist Party lost power in that country. In addition, methods of recruitment that were confusingly similar to those used by a sect were described. The film, which was a hit on the local video black market, was temporarily banned while the lawsuit was being heard.
Amway's civil lawsuit against Network 21 was dismissed by the Warsaw Regional Court in 2004 after a regional court ruled in favour of the company in 2001. The case was ultimately won by Amway on appeal, and the producers were ordered to pay a fine to a children's charity as well as publish a public apology. Although the film was still prohibited as of 2009, this was due to a pending lawsuit brought by "private individuals" who were mocked in the film.
Ultimately, the court determined that the film could be screened, but that the producers must remove "false information," such as a screen that stated that 30% of company income is generated by sales of training materials, and that the vast majority of its profits are shared only by a small fraction of top distributors, from the final cut of the film. Because this is not the only court case in which the film has been challenged, it is still prohibited on other grounds.
Dr. Phil and the Shape Up programme
An investigation by the Federal Trade Commission into the "Shape Up" line of supplements by TV personality Phil McGraw (a.k.a. Dr. Phil) resulted in him pulling his supplements off the market in March 2004. (FTC). The supplements were created by CSA Nutraceuticals, which is a subsidiary of Alticor's Access Business Group, which produces nutritional supplements. The Federal Trade Commission later dropped its investigation, but a class-action lawsuit against McGraw was filed in October 2005 by several people who had used the supplements and claimed that the supplements, which cost $120 per month, did not help them lose weight. Shape Up users who were dissatisfied with the product were awarded a $10.5 million settlement in September 2006, in which Alticor agreed to pay $4.5 million in cash and $6 million in Nutrilite products to satisfy their complaints.
Procter & Gamble Corporation
The (old) Procter & Gamble service mark was in fact a Satanic symbol, according to some Amway distributors, and the CEO of P&G is himself a practising Satanist, according to other distributors. (In some versions of the storey, it is also claimed that the CEO of Procter & Gamble made donations to the Church of Satan in the form of "satanic tithes."Procter & Gamble claimed that several Amway distributors were responsible for a resurgence of the storey in the 1990s and filed defamation and slander lawsuits against several independent Amway distributors as well as the company. To spread the rumour among their downline distributors in April 1995, the distributors used Amway's Amvox voice messaging service, which was provided by the company. Amway and its distributors were found not guilty of all allegations against them by 2003, following more than a decade of litigation in a number of different states. In October 2005, a Utah appeals court overturned a portion of the lower court's decision dismissing the case against the four Amway distributors, and remanded the case back to the lower court for further consideration. On March 20, 2007, a U.S. District Court jury in Salt Lake City found in favor of Procter & Gamble in the lawsuit against the four former Amway distributors and awarded the company $19.25 million. The case was officially settled on November 24, 2008, according to court records. "It's hard to believe they'd continue to pursue it this long, especially after all the retractions we've issued," said distributor Randy Haugen, a 53-year-old businessman from Ogden, Utah, who maintained that P&G was never able to demonstrate that the rumors were detrimental to the company. "we are taken aback. We're all in this together."
Vietnam has a history of regulatory violations.
In January 2017, the Ministry of Industry and Trade of Vietnam determined that Amway Vietnam had violated federal regulations by engaging in unauthorized multi-level marketing activities without permission.
There are also other issues to consider.
Cultism
Some Amway distributor groups have been accused of employing "cult-like" tactics to recruit new distributors and to keep them involved and committed to the organization. Some allegations include resemblance to a Big Brother organization with a paranoid attitude toward insiders who are critical of the organization, seminars and rallies that look and feel like religious revival meetings, and a high level of participation by distributors despite their low-income levels. An examination of the tax records for the years 1979–1980 in the state of Wisconsin revealed that the Direct Distributors reported an average net loss of $918 per year.
NBC's Dateline NBC
An undercover investigation into the business practices of Quixtar was featured on Dateline NBC in 2004. The report was critical of the company and aired on Dateline NBC. There is a lot of hype around Quixtar, but many of the "high-level distributors singing the praises of Quixtar" are actually "making the majority of their money by selling motivational books, tapes, and seminars; not Quixtar's cosmetics, soaps, and electronics," according to the report.
"In fact, approximately twenty high-level distributors are members of an exclusive club; a club that the hundreds of thousands of other distributors are unable to join because of their position. In recent years, only a select group of individuals, including Bill Britt, have been able to run extremely profitable businesses selling all of the books, tapes, and seminars that the rank and file distributors can't sell themselves but that they are repeatedly told they must purchase in order to be successful."
According to the program, a Quixtar recruiter who was featured in the report made misleading and inconsistent statements about Quixtar earnings during a recruitment meeting, and he also had an outstanding arrest warrant for cocaine possession from the mid-90s, according to the report.
When the Dateline report aired, Quixtar responded by publishing a "Dateline Quixtar Response" on its official website. Quixtar responded with the following statement:
"We discovered that two Dateline producers had registered as IBOs and had been conducting undercover research for the story for several months, including the use of a hidden camera to videotape meetings and conversations with IBOs. Although the producers did not explicitly state that they were working for Dateline, they pretended to be interested in starting a business powered by Quixtar."
In addition, the website stated that:
According to the report, "Dateline's story on Quixtar was boiled down to the complaints of three former Independent Business Owners (IBOs), one of whom happens to be a competitor, and ignored the hundreds of thousands of IBOs powered by Quixtar who are achieving their goals."
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