Amway Watch News Feeds

Monday, September 13, 2004

Team of Destiny � Tools Discount Schedule 2002

Team of Destiny � Tools Discount Schedule 2002

Shock! Horror! If you buy 1000 of something then you get a unit price cheaper than someone who buys 1 of something!

It always amazes me that people find this surprising. This is *exactly* the way virtually ALL product related businesses work, whether they be Amway, Coca-Cola, or Team Of Destiny. (disclaimer: i'm not associated with ToD)

So, if you have a business where you require 1000 tapes for training your organisation, your buy price is $3.00 a tape. If you buy one tape, then your price is $6.00 a tape. Seems pretty reasonable to me. How else would it work????

Scott Larsen says -

In the case of TOD tapes, 50% of the price is paid as a commission. If it costs $0.50 to reproduce a tape, then $2.50 is still unaccounted.

In the case of the monthly TOD seminars just 32% is paid out. $17 per ticket is unaccounted. Forty-six percent of the major function tickets are paid out, 54% of the ticket price is unaccounted.

Unaccounted for? For the tapes, how about postage, staff costs, office costs, insurance costs, legal fees, etc etc etc, just like any other business. For seminars, how about all of these plus venue costs, speaker fees, speaker expenses, sound and light engineers, staffing, translators, etc etc etc.

Then of course, perhaps there's some "profit" left over? The IBO Organisation I work with spent over US$1 million dollars in the Phillipines before the amway market even opened there! The money has to come from somewhere. Any individual event (or tape for that matter) cannot be taken on it's own. Tapes remain unsold in stock, so are an expense, events need to be planned and paid for in advance. So many other things as well.

A standard "example" of product distribution is that if something costs $1 to make it will typically sell for around $10. In this case we have tapes costing say 50c to duplicate, plus of course recording and office expenses, and selling for $6, ie much the same as with anything else.

It's a business - get used to it.

Monday, July 26, 2004

The Facts About Quixtar

The Facts About Quixtar

Ahh, the usual confusions about the FTC's 1979 ruling!!! How many people have actually read it? Sometimes I wonder if Scott has.

1. Sales-based compensation.,1607,7-164-17343_18163-44709--,00.html>Click here to read what the MIchigan Attorney General website actually says. You'll note that the site does have the quote Scott uses. The site also says -

"Avoid any program that focuses more on recruitment of new people rather than the sale of real products or services to end-user consumers."

This is where there is a deal of confusion throughout the modern networking market place. "end-user" is not the same as "retail client". Unfortunately even the Attorney General's seem to get confused about this. If one actually reads the original 1979 FTC ruling (
its here) you'll see the court talks abnout sales to consumers

Respondents have avoided the abuses of pyramid schemes by .... requiring that products be sold to consumers

Guess what??? IBO's are consumers too!!!

As for the 70% rule, this is where Scott really show's he hasn't got a clue how this business works .... the 70% applies to both wholesale and retail sales. That is, everything "sold" to downline counts in the 70% as well. These days the logistics are handled directly by Amway/Quixtar, but it's all still part of an IBO's sales ... just they are wholesale sales

2. No "headhunting fee."

Same misunderstanding Scott! If there are no sales then an IBO cañt make a profit. Wholesale sales are still sales!

3. No purchase requirements

Oh good grief. Of course IBO's are encouraged to buy stuff! Duh! Would you buy anything from someone who doesñt use it themselves? Frankly I think anyone who trys to sell something they wouldn't use themselves is being unethical.

As for the IBO training materials ... well yeah, going to lectures and buying books for college is optional too. Heck, I know. In my undergraduate degree I didn't take up that option and barely graduated. Later I was lucky enough to be invited for a postgraduate degree and I made a difference choice - I bought books, went to seminars, studied! Guess what? That time I was near the top of the class.

Still, learning the material was optional

4. Buyback rights

Amway has always given me or my downline a 100% refund when requested. As for BSM, my upline has personally guaranteed to refund 100% of any BSM upon request. I offer the same guarantee to my group.

More on the FTC case

As mentioned, Scott doesn't seem to understand the case at all. The only thing here of any validity is the 10 customer rule. Problem is, how to define a customer? If someone elects to register as an IBO to get the cheaper prices, are they a customer? Personally I think yes, if I have to call someone up weekly or monthly and tell them about new offers, and encourage them to buy, ie market to them, then I consider them customers. My profit is in the volume rebate I get on their purchases. All I can say is that Network 21 teaches people to have 10 customers because it makes business sense. it's not even an Amway rule in the countries in which I operate.

To summarise Scott's misunderstanding, he says -

"the FTC found at that time that Amway had and enforced rules that encouraged retail sales, including the 70% rule."

no no no no no!!! It's all about sales to consumers and wholesale sales to downline not just retail sales! The FTC was quite rightly concerned about people buying stuff just to qualify at different levels and ending up with a garage full of soap powder. That's what the rules are designed to stop!

Monday, July 19, 2004

a2k price comparison

Not sure where this came from, but it's simple to do yourself - and

Note that Amway Australia has a price guarantee - if you find the same product cheaper at a competitor then they'll match or better the price. This price comparison claims virtually everything was cheaper at Woolworths online. When I was last in Australia I challenged a2k on some canned Tuna - they dropped the price. Has nobody challenged them if this spreadsheet is correct?

I just checked a handful of products (July 2004). Coca Cola 600ml and Aurora Instant Coffee, in both cases a2k at retail was cheaper. Madura English Breakfast Tea, as the time I checked was on special at Woolworths, their regular price was more expensive, their special slightly cheaper.

The really big misleading prices are when the spreadsheet creator doesn't compare "like with like". For example he compares Woolworth 1.25l Pepsi with a2k 600ml Pepsi and comes up with Woolworths as being 177% cheaper!!! Why not compare 600ml pricing at both places - if you do then a2k comes out cheaper, even at retail!

A real issue with price comparisons comes when trying to compare different brands. I read somewhere on the Amquix site where someone was comparing store bought Vitamin C with Nutrilite C Complex and noting how much cheaper the store bought one is. This is kind of like comparing the price of a Lada with a Ferrari and saying Ferrari's are a rip off! Not even close to competitve products :-) 

And comparing Energizer batteries with "Acme" brand? Good grief.
Mind you, nice to see they apparently did reasonably correct comparisons on cleaning products, and the AMway stuff kicks butt :-)

Do comparisons yourself at retail pricing and see for yourself, a2k and homeshop both allow guests to browse.

Thursday, July 15, 2004

World Games Inc.

World Games Inc.

I keep coming across WGI, aka World Games Inc, when I'm out talking to people, so I thought I'd check it out.
Well ...... not to good I'm afraid. So far I've found 8 Canadians charged with promoting a Pyramid (see this warning from the Mounties ), a Swedish woman convicted (Read this thread ), and the Australian founder, Greg Kennedy, currently in court with the Australian Competition and Consumer Commission (

Now, WGI seems to have two basic problems. First of all, in MANY countries, it's illegal to promote gambling without the appropriate government licence. Building a WGI network involves doing precisely that.

Second, it apepars that to make money in the business side of WGI, as apart from the lottery and virtual stockmarket side, it requires you to introduce other people to the network. ie, you are paid for recruiting new members. In most jurisdictions this is consider a sign of an illegal pyramid selling scheme. There should be a real product or service available to end-users with no membership fee available. Of course, doing this with WGI would result in you falling foul of the first problem all over again!

Wednesday, July 14, 2004

Bill Britt and Phyliss Frankel

Bill Britt and Phyliss Frankel

Well from what I've read and seen I'm not a huge fan of Bill Britt ... but good grief Scott .... isn't this all just a bit "tabloid"???

Sunday, July 04, 2004



Really only 3 comments to make on this page -

1. The document was prepared on behalf of Proctor & Gamble .. the world's biggest producer of competitor products to Amway

2. P&G lost the court case they used this information in.

3. In 7 years of experience with Amway (note: not in any of the "families" for which examples are given), I have never experienced any of the things he claims, for example -

"The "upline" assume virtual "parental" control, and distributors are urged to "counsel" on all aspects of their life, including topics such as which car to buy or how to handle marital problems"

Indeed, Jim Dornan, head of Network 21, has explicitly said we should not be engaged in things such as giving marital advice! Leave that to the experts! When I personally was having some marital problems (not related to the business) and I brought it up with my upline and the first thing they said was "Have you seen a marriage counseller?"

Thursday, July 01, 2004



Wohhhaaa... some scary stuff in this memo! I would point out that it is more than 20 years old. Having said that, I've little doubt much of it is still true, at least in parts. Let's however compare what it says Britt/Yager does compared to what I've always been taught in Network 21 (incidentally, N21 was formed some 6 years after this memo).

A. Relationships

well, obviously relationships are important in any business, and obviously in a networking business your upline relationships are very important. Remember though, this is to each IBOs advantage. As a new IBO, one of the first questions you get is "yeah? so how much do YOU make?". To be able to introduce your propects to successful people you know personally is very useful. It's also of course useful to have the knowledge and experience of your upline available to teach you and your business.

A.1 This section has quite a few areas of difference with N21. For example -

"distributors are taught that they are to do all that has been requested of them by their line of sponsorship"

no no no no no!!! We are taught to think like an OWNER. It's YOUR business!! Get advice, then MAKE YOUR OWN DECISION.

"There is no room for individuality or creativity. They are taught consistently that there is no need for creativity, since the line of sponsorship has the answers for them"

complete opposite - be creative! Come up with new ideas and approaches! We are constantly having new approaches and techniques and tools moive through our LOS and system. Some of the ideas have come from brand new IBOs! Obviously though, if you have a great idea, run it past your upline. If they've been around a while they may already have tried it and seen if it works or not, or other pitfalls. That just makes sense.

"In fact, after a Direct becomes a Diamond, he is still not free to act on his wishes. In the area of finances, a new Diamond in the Puryear organization recently confided that in order for him to buy a house, it was necessary for him to receive the approval of Ron Puryear and Bill Britt"

This is just a horrifying comment to me. I've heard Jim Dornan, founder and owner of Network 21, explicitly say that you need to be careful in your advice to downline. Chances are you are not a professional counseller, or account, or for that matter real estate agent :-), so don't give advice in these types of areas! If people have, say, marriage difficulties, encourage them to get professional help! Upline is there to advise on the business - anything else borders on dangerous!

2. Relationships with other lines of sponsorships

"They may read no other material except that provided by their line of sponsorship"

In Network 21 we are encouraged to read as much as possible, not just the "recommended books". Obviously we are encouraged to read "worthwhilė material" and not just romance novels, but definitely completely different to this reported approach.

"They may listen to no tape or receive any other information from any source, other than their line of sponsorship"

again, we are encouraged to get more education. Go to personal development seminars, listen to other personal development and business tapes.

"It excludes from the sources of information any reference to any other line of sponsorship or any achiever in Amway"

well, my very first seminar and the guest speaker was a guy by the name of Louie Carrillo. He explicitly mentioned how he was not a part of the Network 21 organisation. That's happened numerous times since with other speakers. Funnily enough, at later times some of these speakers have moved their organisations across to Network 21. I wonder why :-)

3. Relationship with the corporation.

"the line of sponsorship does not allow communication between the distributor and the corporation"

Right from the beginning if I had a question directly related to the business side of things rather than the networking side, I was encouraged to not waste my uplines time getting them to find the answer, but to contact the corporation directly! We are encouraged to attend Amway provided events. The corporation itself has had a speaker at every major Network 21 seminar I've been to for some years.

B. Motivation

1 and 2. Tapes and books and Functions

In Network 21 there's a pretty basic formula followed just as it is in any business. The more tapes and books you buy, then the cheaper you get them per unit. It always surprises me that people find this strange! As a businessperson outside Amway, this seems normal to me! In any case though, there are checks and balances in place to ensure that the prime focus is on moving Amway product, not tools.

3. Accessories

This is new to me! Never seen it in N21

4. Counseling

In Network 21 this is just business planning and advice - makes sense!

5. Moving Up

"If a Diamond sponsors a Diamond, that second Diamond should not go Double Diamond until the first does"

Oh good grief, how insecure are these people? My upline has consistently said how great it would be if I had a bigger business than them! Heck, the bigger my business the more money they make! One of my upline Emeralds has dozens of Diamonds and above in his business. He even has at least two Crown Ambassadors!

I can barely even comprehend the thinking behind these comments!


Amazing if true, and I have no reason to believe it is not. We are encouraged right from the beginning in Network 21 to think like an owner; To get information and make our own decisions. If you are just a slave to your upline, what's the difference with having a boss? It's YOUR business, TAKE RESPONSIBILITY!!!!

Giblin v Network21

Giblin v Network21

I have heard, but not confirmed, that what happenned here was that thoe owners of the copyright for Giblin's book (his son?) had at on stage mistakenly put the wrong date of original publication on their website, and someone from N21 thus incorrectly thought it was out of copyright. No doubt that N21 screwed up here, but I can see how it happenned. In any case, they rightly paid the outstanding royalties.

Eric Scheibeler's Story

Eric Scheibeler's Story

So, someone sues the company who "pays" him, and they put his pay in escrow and we are supposed to be surprised? Good grief, get in the real world.

And this guy says the most he ever made as an Emerald was $30000/yr? Well, first of all, I can show you how you qualify for an Emerald pin and make a lot less than that, like less than $5000/yr!! The aim of a quixtar/amway business should be to develop a profitable business. I can guarantee that Amway/Quixtar paid the Scheibeler's exactly what the business plan said it would pay them for the business they create. Any IBOs reading this, know the business plan and work for a profitable and stable business, not just a pin.

Now, the thing that stuns me most about the Scheibeler's story is that he says that the most they made was $30000 in a year, yet he also states he quit his job??? I remember not long after I began in the business my upline Emerald stated that you shouldn't consider leaving your job until you are earning at least three times as much from Amway as from your job. Mr Scheibeler was either a very poor insurance underwriter, or, I hesitate to say, not very smart!