‘You can see we’re getting the screens fixed,’ the Realtor says, pointing to the men working beyond the glass. She has piercing blue eyes. Processed blonde hair. She has French-tipped nails, diamond rings on all fingers, and a gold-and-diamond necklace. She wears a white semi sheer shirt, black-and-white-printed leisure pants, black eyeliner and heavy mascara. ‘We’re just putting some finishing touches on the place.’
Each year, Rich DeVos attends The Gathering, a below-theradar conference of hard-right Christian organizations and their biggest funders. Featured speakers have included the president and CEO of Alliance Defending Freedom, the president of Focus on the Family, and the head of the Family Research Council. The philanthropists in attendance are representatives of some of America’s wealthiest dynasties and family foundations, and of the National Christian Foundation, America’s largest provider of donor-advised funds given to Christian causes. Donors who meet at The Gathering dispense upwards of $1 billion a year in grants.
A “Direct Distributor” is one whose group does 7,500 PV or more in monthly sales (which is almost $25,000 a month in U.S. currency, a far more daunting figure which the artificial PV currency helps to disguise). Direct Distributors are entitled to order directly from Amway without going through their upline sponsor, as the lower ranks must do. Once you are a Direct Distributor, your group is no longer nested in your sponsor’s. From then on your sponsor gets only a straight 4 percent cut (the “Leadership Bonus”) of your group’s sales. You accrue more bonuses by lining up DDs under your direct sponsorship: six DDs make you a Diamond, twelve a Double Diamond, twenty a Crown Ambassador.
The lack of government prosecutions, along with sophisticated PR spin and misleading income data have given MLM schemes an aura of legitimacy, heightening their ability to fool consumers and the media as well. Gradually, though, the truth about how MLMs have escaped regulation is coming to light. The answer is plain and simple: MLMs bought influence in Washington and in some state legislatures with campaign contributions and high pressure lobbying.
Amway is an $8.6 billion direct selling business based in Ada, Michigan, USA. Top-selling brands for Amway are Nutrilite™ vitamin, mineral and dietary supplements, Artistry™ skincare and color cosmetics, eSpring™ water treatment systems and XS™ energy drinks – all sold exclusively by Amway Business Owners. Global sales in 2016 made Amway the No. 1 direct selling business in the world, according to the 2017 Direct Selling News Global 100. The company’s annual sales figure includes revenue from direct selling operations and other business holdings.
On its face, the debate over right-to-work is about an arcane bit of labor law—whether workers under a contract that was collectively negotiated by a union should have to pay dues to that union, regardless of whether they’re members. But that debate is a proxy for a larger battle that is less about employment law than political jockeying: Unions tends to align with Democrats, and as a result, if it becomes more difficult for unions to collect dues, they’ll be weakened and less able to advocate for the political causes of their choosing.
MLMs, which thrive in rural communities like Owosso, on military bases, and in countless Facebook groups, aren’t often targeted in mainstream reporting; when they are, Marie says, “It’s from the viewpoint of an old white guy activist investor on Wall Street. That doesn’t tell me anything.” Though she hopes The Dream might shine a light for some people on what a raw deal MLMs can be, Marie also sees endless juicy stories. “It’s entertaining and weird, this weird world that you see in your Facebook feed, and on anti-MLM Reddit channels where everyone’s gossiping about their cousins. I wanted to like, go inside and be in that industry. . . . I want to know why my cousin Stephanie is doing this every day on Instagram, and is she making any money or not? Or what are her friends saying?”
It was a single-story, with four bedrooms, three and a half baths, a roundabout drive, and a screened-in pool. ‘You’ll see the gates,’ I’d say to my friends when giving them directions to my new house, feeling endowed with importance, despite the fact that these were not real gates – they were only for show. ‘They’re metal arches that say ‘Carlton Estates,’’ I’d say. These words tasted like gold. Carlton was a surname hyphenated invisibly after my own. I lived in Carlton Estates: that was surely worth something.
My uplines’ despair made me reluctant to add to their failure. But I had stayed in too long already. Having run out of other things to buy, I had resorted to subjecting my cat to Amway pet food. And I began to sense that when Josh and Sherri looked at me, they—in their last-ditch hopes—saw Diamonds. Before I disappeared from their lives, however, I accompanied them to one last Rally.
The problem for Amway distributors (or any other genuine MLM company) entering the game late is that it is difficult for them to sponsor new distributors. It is also difficult for them to sell Amway products given that there are so many distributors already operating in the market and they have selling relationships in place. Also, products sold by MLM companies typically tend to be more expensive than similar products being sold in the open market, making it more difficult to get customers willing to buy.
The company’s biggest market for their nutrition, beauty, and home products is China; and they have strong sales throughout Asia; the U.S. accounts for a mere 10 percent of their business. The company has located a majority of its manufacturing facilities in three cities in the U.S. And Amway has invested $335 million in manufacturing upgrades over the past four years, a majority of which was spent here in the U.S.
The Amway Board of Coaches is made up of 65 head coaches at Bowl Subdivision schools. All are members of the American Football Coaches Association. The board for the 2018 season: Blake Anderson, Arkansas State; Major Applewhite, Houston; Dino Babers, Syracuse; Mike Bloomgren, Rice; John Bonamego, Central Michigan; Terry Bowden, Akron; Jeff Brohm, Purdue; Neal Brown, Troy; Troy Calhoun, Air Force; Rod Carey, Northern Illinois; Bill Clark, Alabama-Birmingham; Dave Clawson, Wake Forest; Geoff Collins, Temple; David Cutcliffe, Duke; Mark Dantonio, Michigan State; Bob Davie, New Mexico; Butch Davis, Florida International; Dana Dimel, Texas-El Paso; DJ Durkin, Maryland; Herm Edwards, Arizona State; Luke Fickell, Cincinnati; Jimbo Fisher, Texas A&amp;amp;amp;amp;amp;amp;M; P.J. Fleck, Minnesota; James Franklin, Penn State; Willie Fritz, Tulane; Scott Frost, Nebraska; Justin Fuente, Virginia Tech; Turner Gill, Liberty; Mike Gundy, Oklahoma State; Bryan Harsin, Boise State; Clay Helton, Southern California; Tom Herman, Texas; Dana Holgorsen, West Virginia; Mike Jinks, Bowling Green; Kliff Kingsbury, Texas Tech; Brad Lambert, Charlotte; Mike Leach, Washington State; Lance Leipold, Buffalo; Tim Lester, Western Michigan; Seth Littrell, North Texas; Rocky Long, San Diego State; Chad Lunsford, Georgia Southern; Mike MacIntyre, Colorado; Gus Malzahn, Auburn; Doug Martin, New Mexico State; Urban Meyer, Ohio State; Jeff Monken, Army; Dan Mullen, Florida; Pat Narduzzi, Pittsburgh; Ken Niumatalolo, Navy; Jay Norvell, Nevada; Barry Odom, Missouri; Ed Orgeron, LSU; Gary Patterson, TCU; Chris Petersen, Washington; Bobby Petrino, Louisville; Nick Saban, Alabama; Scott Satterfield, Appalachian State; Kirby Smart, Georgia; Rick Stockstill, Middle Tennessee; Charlie Strong, South Florida; Dabo Swinney, Clemson; Jeff Tedford, Fresno State; Kyle Whittingham, Utah; Everett Withers, Texas State.
In the canonical 6-4-2 pyramid, the “Direct Distributor” on top receives a 25 percent “Performance Bonus” on the entire group’s spending. The Performance Bonuses that go to his six “legs” (12 percent of their sub-groups’ spending) are deducted from his own, leaving him with a 13 percent profit. In turn, they payout 6 percent bonuses to their four “legs,” who payout 3 percent bonuses to their two. Those bottom forty-eight distributors, in other words, get back 3 percent of everything they spend while the top distributor gets 13 percent of everything they spend. (The amount of all checks are calculated, incidentally, by Amway’s central computer and distributed by Amway; uplines don’t actually write checks to their downlines.) It would amount to the same thing if the distributors at the bottom were to receive the 25 percent rebate—and then pay fees directly to their uplines equal to 3 percent, 6 percent, and 13 percent of their purchases.
In 2014, Founders Crown Ambassadors Barry Chi and Holly Chen, who run the biggest Amway distributorship in the world based in Taiwan, were sued by nine Chinese immigrants in the Southern California region who claimed that, although Chi and Chen promised they could potentially make millions in commissions, Amway business owners make closer to $200 a month.
The next week, I decided. I would never learn the truth about Amway until I joined. I left a message on Josh’s Amvox voicemail telling him I had the $160 check ready. A week later, I left another message. By my third attempt, I got Josh himself (who had been intending to return my calls) and was finally able to arrange a time to separate me from my money. It wasn’t the last time I felt he and Jean weren’t exactly cut out for the rigors of The Business.
Inefficiencies were everywhere, since the supply chain rigidly followed the line of recruitment. Some of the items I ordered had to be sent by mail all the way from Seattle, since that was where Scott and Shelley Coon, our upline Direct Distributors, happened to live. Others could be shipped from a regional warehouse in Michigan—one of Amway’s attempts to make the system more workable—but still had to be ordered through the Coons. Some items—unavailable from the warehouse—could be sent directly to me via UPS, but my building didn’t have a front desk to receive them. Jean suggested I have them sent to her apartment to be picked up with the rest of my order.
Days after the 2012 election, Dick DeVos picked up the phone and rallied Republican lawmakers to pass right-to-work in lame duck while they still had the votes, reportedly promising financial support to those members who would find themselves facing tough reelections and suggesting he would back primary campaigns against those who didn’t step in line. “There’s one family who gets these people elected, and consequently, you can assume they can get them unelected, too,” says Gretchen Whitmer, who was the state Senate’s Democratic leader at the time.
According to this article, “The way that you’re actually going to make residual income is by sponsoring people into a downline. Yes, this means that you are going to need to get really good at recruiting your friends and family into the business to become an active distributor just like you.” This means that if you’re looking to make it to the top of the Amway hierarchy, you’re going to need to create a large network of IBOs underneath you, and earn a commission off of each sale they make. In other words, creating recurring monthly income occurs not necessarily by selling Amway products, but by recruiting others to sell them for you. And this simply can’t be avoided, because in order to begin selling Amway products, you’ll have to sign up under an existing IBO, who will make money off each of your sales.
A key aspect of the suit is the charge that Amway misleads consumers with false income claims and promises for its “business opportunity.” Pyramid Scheme Alert’s analysis of Amway payouts to distributors shows that more than 99% of all who sign up never earn a profit. When actual costs are factored, including the related “tools” business, some estimates put the loss rates at 99.9%. This 99% loss figure correlates with tax data gathered as early as the 1980s when the state of Wisconsin prosecuted Amway. It was also verified by data gained by federal regulators in England who sued to shut down Amway in that country just several years ago.
Ironically, the people who quit Amway and claim to be experts at it probably never even really understood the business. This is apparent by their complaints, the top complaint I hear being “Oh you have to buy a bunch of product every month…” So lets clear that misconception up. .. Think about a mall for a second…. Malls have stores in them right??? Lets say you OWN a mall. And lets say that I own Best Buy. I go to you and say “hey can I put a Best Buy in your mall?” You say “yeah, sure”… So because YOUR mall sells MY product does that mean that YOU work FOR ME? Of course not, it just means that I am a supplier of your business… Now,..lets use logic here...IF you owned the Mall...and you needed to buy a TV...where would you buy it from?.....Well if you're capable of thinking like a business owner, the answer is you would buy it from YOUR MALL..Because a business owner supports his own business, always. When you own a business you never support your competitors. So how does this tie into what Amway does.. Amway supplies you with a business that is really like an online mall. This mall is filled with stores that Amway networks with such as Nike, Best Buy, Nutrilite, Forever 21, Banana Republic, XS Energy Drinks,..(many more). So if you use your head hear and think about it, AMWAY is an excellent business model. It creates the most loyal consumers in the world. Because these consumers are also owners! They are owners of their own online mall, and within this mall are stores that THEY WERE ALREADY SHOPPING AT. And the stores within your mall don’t even have to advertise to you, because you’re already incentivized to shop through them…because you OWN a mall that sells their stuff!! So ,.. when you are an AMWAY Independent Business owner…no, there is no REQUIREMENT for you to spend a monthly quota on AMWAY products…..But you’re not very smart if you don’t spend money through your business ....because they are YOUR products…You OWN a business..and you’re not even supporting your own company…. The key is not to just haphazardly purchase Amway products…its to SHIFT your purchasing to stop buying from other stores and support your OWN store…NOT spend EXTRA. I can supply my own home with my Amway business,.. I used to buy Tide Detergent, now I buy Legacy of Clean because its MY product…I used to take GNC vitamins, Now I only buy Nutrilite because its MY product…I used to drink Red Bull…Now I drink XS because its MY product… And in addition, you do not have to be great at sales…You don’t need a lot of customers! This industry is not about getting 100 customers…its about getting 1 to a few customers …and YOU being YOUR OWN best customer. You teach someone smart how to do the same thing. Duplicate that a few times. And you’re retired. Not easy. But what sounds better to you (speaking to Generation Y and younger),…working for 30, 40, 50 years and never being able to retire because our generation WILL NOT be able to retire the same way our parents did… or building the Amway business for 2 – 3 years and never having to work again. Read “Business of the 21st Century” by Robert Kiyosaki” if you want to know more about the industry and why it’s the PREFERRED business model of our times.
The recently published book, No One Would Listen, by whistle blower, Harry Markopolos, dramatically describes how SEC regulators ignored his alerts and allowed the Bernard Madoff Ponzi scheme to grow to enormous proportions. Their failure to act caused harm to thousands more people, despite his written and detailed warnings, which he brought to the agency five separate times over an eight-year period of investigating the scam. Additionally, the news media such as the Wall Street Journal and Forbes magazine also failed to respond to his evidence which he offered them. Madoff was apparetnly treated as “too big to expose.”