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$700 on Products, $200 of which are shown here

August 5, 2008

This BusinessWeek article on Amway flew under my radar last week. Amway: Shining Up a Tarnished Name doesn’t share any new information about Amway Global, but what I found interesting was the IBO they interviewed. Cathy Cross is described as a part-time seller who:

has spent $700 on products and marketing materials this year, just less than what she’s earned in sales and bonuses (She doesn’t expect to take home profits until 2011).

Amway seller Cross, at home with products, has spent $700 so far this year

I hope that Amway provided the products she proudly displays in the photo accompanying the article (shown here on the right), because — by my reckoning — there’s at least $200 of products there, and it’s already August, 2008! Those bottles of Perfect Water and XS do add up in dollars, and I don’t even want to think about the price of that Artistry skin care kit in the background! Good thing I don’t see a few containers of Double X, or I’ll be asking to see her receipts!

All kidding aside, say she’s earned $800 in sales and bonuses this year. I’d expect that’s because she’s been retailing products to friends, family, and strangers. This is a good thing, and something that IBOs should do more of if they want to take home profits at the end of the month instead of incurring mounting losses due to System expenses.

Readers of this blog will know that I’m critical of the Alticor Corporation (parent of Amway and Quixtar), which has done very little over the past several decades to curb the excesses and greed of a few individuals at the top of certain Lines of Sponsorship (LOS). Though they appear to be taking steps to clean up their tarnished name, I feel Alticor needs to take more dramatic steps before they actually start seeing results:

  1. Get rid of the Alticor name: I know Quixtar is by the way of the dodo next year, but what about the Alticor name?
  2. Lower product prices: Products need to be more affordable for retail customers.
  3. Focus on retail: If you have more affordable products, the emphasis has to switch from self-consumption to retail. That’s how the rest of the world works, folks. Buy from cheap, sell for a little higher. Repeat.
  4. Stronger accreditation program: Many LOS seem to be doing the same thing they’ve always done in the past. Unless Amway Global takes aim at the kingpins, the things many System critics point at will continue to happen.
  5. More direct communication with IBOs: Amway has outsourced teaching and training to the Amway Motivational Organizations (AMO) and it needs to take some of it back.

I’ve been reading some old articles on Amway and Quixtar recently. It would be very illuminating to interview those people quoted in articles five, ten, or fifteen years ago to see if they are still in the business and continue to maintain the same stance.

I know I’m singing a few different tune than I was ten years ago!

3 Comments leave one →
  1. August 5, 2008 12:13 pm

    At least iteamusa.com publicly promotes retailing and making your profit from product volume, not the tool scam.

    1. The Alticor name isn’t a problem.
    2. Some prices do need to be lowered, or drop the product.
    3. Retailing would be easier with lower prices, but there are plenty of products that can be retailed NOW. Also, we don’t need to turn into retailing “animals”, that misses the point of owning a business rather than being a salesperson with a job.
    4. Valid point. Accreditation needs to clamp down on the tool scam.
    5. They already are.

  2. Joecool permalink
    August 6, 2008 3:44 pm

    “has spent $700 on products and marketing materials this year, just less than what she’s earned in sales and bonuses (She doesn’t expect to take home profits until 2011).”

    Where did she get this idea? AQMOs?

  3. August 7, 2008 10:19 am

    You should ask her.

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