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Knowing When To Quit

September 29, 2008

I just read this article on MSNBC.com about “knowing when to call it quits in business.” It follows the story of Sandy Tacchino of Fresno, Calif, whose Little Dreamers retail shop recently closed due to bankruptcy. She put everything into the business only to see it fail after just a few years in this weakening economy.

From stage, upline kingpins teach their downline IBOs that their Amway businesses are much better than brick and mortar retail stores or even franchises. There’s little upfront capital involved, and you don’t have employee headaches or other such problems. While this might be true on a superficial level, an Amway business is just like a traditional business in many respects.

For instance, you won’t get paid unless products are sold through your business and your organization. The buy from yourself and teach others to do the same model is not a long-term sustainable business model. Instead of kicking back and watching the profits roll in each month, you’ll be traveling around the country, constantly trying to replace those IBOs than are leaving the business month-after-month. Congratulations, you’ve just replaced one job with another! Having a downline organization is important, but so is selling products to non-IBOs, people outside of the system.

For those who think this is a foreign concept, I have something secret to tell you. Shhh, it’s called retailing!

The article continues by mentioning five warning signs for impending business failure. I’m going to focus on the three that have the most relevant. Have you experienced any of these in your Amway business?

  1. LACK OF SLEEP: How many hours per day, week, and month are you devoting to building your business? Has it affected other parts of your family and social life? Are you constantly driving back home at ungodly hours? Do you need to down countless cans of XS Energy just to stay awake? If so, you might be suffering from a lack of sleep caused by your business. If the results justify the lack of sleep, maybe that’s okay. But, if you’re not making much after spending 20 hours a week, then maybe it’s time for a change?
  2. CHRONIC CASH FLOW and PAYROLL PROBLEMS: Are you making any money after each month in the business after expenses? What are you doing with the extra money you’re making? If after six to twelve months you’re not making more than you’re putting in, I would say that the business might not be working.

Here’s a good quote from the article:

After sinking some $400,000 into her business (including $200,000 of her own money), Tacchino faced a classic dilemma for small business: How do you know if you should cut your losses and walk away or continue fighting to hold on to your stake and your dream? Tacchino believed her can-do, go-for-broke optimism would result in an American success story, not a failure.

You may not be losing that much money in your Amway business, but you may be facing a similar dilemma. When do you know when it’s time to quit? Sure, the Amway business works for other people, some whose stories might even be similar to your own. That doesn’t mean, however, that it’s going to work for you just like them! Take what skills you learned during your time as an IBO and use them in another venture. After all, they say variety is the spice of life! Amway is not the be all to end all your upline kingpins say from stage!

The moment of realization for me came after two and a half years in the business. Expenses far outweighed the meager income that I was generating. I could either try harder or I could quit. By choosing failure in the Amway business, I succeeded. Looking back after nearly a decade, I know that I made the right choice.

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22 Comments leave one →
  1. Gina permalink
    September 29, 2008 8:24 am

    BUT BUT BUT, many many many IBO’s have no clue what their cash flow is nor keep track of ALL their expenses. They have no idea if what they are investing weekly, monthly or yearly is valid and paying off in the end. As long as they keep seeing those checks come in every month from Quixtar they figure it means things are going well, even if in reality those checks aren’t even paying for a fraction of their actual expenses.

  2. September 29, 2008 10:27 am

    Amthrax,

    There is another choice besides keep doing what you are doing or quit: CHANGE.

    I have no problem with you quitting, but your quitting cost hundreds of thousands of other IBO’s a lot of money and time.

    If you had dug in your heels and insisted the LCK’s (Lying Cowardly “Kingpins”) change their ways, you may have less personal success but done a MUCH greater good for many others.

  3. September 29, 2008 10:37 am

    Here is her parting quote from the story:

    “One thing I have learned is that if I had failed and was sad about it, and not energized by the prospect of doing it again, I wasn’t cut out to be an entrepreneur, Tacchino said. “But the fact that I’ve walked through the process, I’ve been a business owner, been an entrepreneur and failed, and I’m excited about the possibility of doing it again — that tells me that I’m cut out to be my own boss, and I would do it again in a heartbeat.”

  4. September 29, 2008 10:38 am

    Somehow I don’t believe that me staying in would have changed the LCKs ways.

  5. September 29, 2008 10:51 am

    Tex – that is a good quote from the article. It doesn’t imply, however, that Tacchino is going to run the exact same business. She might apply what she learned from the first one to her next entrepreneurial venture.

  6. September 29, 2008 10:52 am

    BTW, Tex. I have a post dedicated just for you coming out tomorrow. 🙂

  7. Joecool permalink
    September 29, 2008 11:19 am

    Good post. The best option is to quit. Continuing to stay in, even while trying to shut down the LCKs, benefits the LCKs.

    UNLESS – you are not buying products, but then that’s about the same as quitting isn’t it?

  8. September 29, 2008 12:28 pm

    Amthrax said, “Somehow I don’t believe that me staying in would have changed the LCKs ways.” —- You’re probably right, but I have had experience standing up to “THE MAN” and getting results. Similar to the David and Goliath story. The analogy is I’m David, and you and the rest are the quitters.

  9. September 29, 2008 12:30 pm

    Amthrax, didn’t you READ my comment? Of course she will learn and do things differently, that’s what CHANGE is all about. The point is most people wouldn’t try again, but apparently she is willing to learn from her experience and CHANGE when she tries again.

  10. September 29, 2008 12:32 pm

    jc,

    The key isn’t to not buy products (upline makes pennies from products), but tools (upline makes many dollars from tools). Have you learned NOTHING?

  11. Joecool permalink
    September 30, 2008 9:56 am

    Tex you moron, why do anything to benefit the LCKs? Why not let their quixtar business shrink which in turn will impact their tool business. Do you not understand this simple concept?

  12. September 30, 2008 10:45 am

    jc you asshole, because I enjoy the high quality/conveniently obtained products, and so do my customers.

    Buying products and not tools is like emptying a canteen of all except a few drops of water and heading across a desert. The few drops are of very little value. MORON.

  13. Joecool permalink
    September 30, 2008 3:59 pm

    Tex, you turtle turd. How do you expect to stop the kingpins when you contribute to their coffers, even if it’s small amounts? That’s like saying you only gave a few dollars to a hitman. Retard

  14. September 30, 2008 7:58 pm

    jc,

    What are you talking about? The LCK’s are already dropping like flies.

    The LCK’s have no use for pennies to maintain their power, they need dollars, and lots of them.

    You’re a fool, and an uninformed one.

  15. Joecool permalink
    October 1, 2008 9:58 am

    Tex, the tool tard, how many people do you think are in britt’s or yager’s business? Thousands? I magine if each of those thousands just buy stuff they normally do, that’s a lot of volume.

    If you could actually utilize your amoeba sized brain, maybe you would realize this, and the fact that noone is going to produce tools for free.

  16. October 1, 2008 6:53 pm

    There are probably fewer people in Britt and Yager’s business than last year, at least in the U.S. We’ll find out when Amway reports their numbers in January.

    I never promoted free tools, you idiot.

  17. Joecool permalink
    October 2, 2008 9:53 am

    Tex, the mega moron, tools kingpins will not produice your beloved tools for a price capped profit.

  18. October 2, 2008 11:23 am

    jc/Eeyore, it’s ALREADY happened in the UK, Russia, India, etc.

  19. Joecool permalink
    October 2, 2008 1:18 pm

    Tex the mega moron, it’s not gonna happen in the US.

    The only reason Amway conceded (IMO) to all those conditions in other countries was to save face.

  20. October 2, 2008 1:40 pm

    jc/Eeyore,

    No, they did it to save their business in those countries.

    With enough pressure, they will do the same in the U.S.

  21. Joecool permalink
    October 2, 2008 4:22 pm

    Instead of another tex-planation, do the math.

    Since they sliced prices and they don’t have people teaching dedication to a system or a defacto PV quota, tell me what kind of money they’re making in these countries as compared to say the US where the AQMOs are still running free.

  22. October 22, 2008 3:19 pm

    What will the ABO’s do when they can keep their profit, instead of giving it to the LCK’s to feed their tool scam profit? Time will tell. But I think growth will eventually occur.

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