We were educated that the Amway opportunity was fair by our upline, which was a complete fabrication. That everything was played on an equal playing field. On the surface, this appears to be correct because "everyone starts at zero." Everyone starts at nothing, and while this is true, the compensation model is unfair and, in my opinion, should be revised to ensure that lower level IBOs earn more money. It would almost certainly help with IBO retention, and it is possible that some higher level executives would not have to work as hard to continually replacing employees who quit. If more independent business owners were prosperous, it stands to reason that more independent business owners would choose to stay in the business rather than quit.
If you are a new Amway Independent Business Owner, you may be unfamiliar with the company's compensation structure. Amway awards bonuses that account for around 30% of their total revenue. As a result, if you shift 100 PV in items, or around $300 in sales, Amway will give out approximately $100 in bonuses. You, as a new 100 PV IBO, would receive approximately $10, and your uplines, some of whom are unaware of your existence, would split the remaining $90 in incentives among themselves. Performing the work and receiving payment is not a straightforward process. Of course, an IBO is not required to share any retail sales earnings with his or her upline, but the Amway bonus may be paid out to a large number of people who may or may not have contributed to the volume generation at all.
There's something important to think about. In what other profession would you get compensated at such a low rate (just 3 percent)? I can only think of real estate, but your sales are likely to be in the hundreds of thousands of dollars when it comes to real estate. In almost any other sales-related career, you will receive a far larger percentage of the sale than 3 percent. It is true that your bonus or commission can be bigger if you move more volume, but you will also likely receive more money because you are now taking advantage of others who are completing 100 PV and only getting $10 in return.
And even after taking into account the unfair compensation, you still have to consider the cost of the necessary instruments. The majority of uplines advertise tools (cds, voicemail, and functions) as being essential to an IBO's success in the business. Some uplines are more aggressive in their use of the instruments than others. However, because the cost of tools is typically greater than an IBO's incentive, the purchase of tools will frequently be the principal source of financial losses for IBOs. In the United States, it is highly usual for monthly tool purchases to exceed $200 per month on average, and only a very small percentage of IBOs will ever reach a level in the Amway reward plan that allows them to earn enough to just break even. In addition, it appears that the tools are not functional. There is no unbiased evidence to imply that tools are associated with IBO success in any way, shape, or form.
Because of Amway's reputation as well as the unjust compensation plan, IBO retention is extremely low. Approximately half of all IBOs fail to endure even one year, and only a very small percentage of those who do survive will be able to last more than another year or two after that. As a result, IBOs begin to realise that building a downline is practically impossible, and as a result, generating greater volume is nearly impossible, even for persons with exceptional abilities. If you are a new IBO or a potential, I encourage you to sit down and truly look at the numbers, taking into consideration the cost of tools and other expenses. It is possible to make a dollar in numerous ways. In my professional view, the Amway opportunity is not the best method to accomplish this.
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