CHAPTER - II

2.1 INTRODUCTION

Amway-Global Leader in Direct Selling

Amway is a global leader in direct selling, with over three million Independent Business Owners
(IBOs) in over 80 countries and territories around the world. No other direct selling company can
compare with Amway’s longevity, stability, and global reach. For more than 55 years, Amway
Corporation has enabled people to have a business of their own. Originally known for direct
selling of our household cleaning products, such as SA8 Laundry Detergent and L.O.C. Liquid
Organic Concentrate, Amway business opportunity is now supported by an excellent portfolio of
hundreds of high-quality products and brands that can only be purchased through Amway IBOs.

Why People Choose the Amway Business Opportunity

People join this business for a variety of reasons. Some become IBOs simply to be able to
purchase products for their own personal use at a reduced cost. Others Join in order to direct sell
the products to others, earning a profit on each sale and additional financial benefits based on
their sales volume. Business builders not only sell products; they also sponsor others to join the
business. They are compensated for their own sales and well as the sales of those they sponsor,
receiving incentive bonuses that increase as their own sales force increases. All IBOs have the
identical opportunity to grow a successful business. Each business owner is compensated in
direct proportion to his or her efforts.

Statement of the problem

In this competitive world lot of MLM companies are there in the market and they have variety of
product lineup as well. Some of them are successful and few of them not doing well. Here we
have taken an attempt to study about a company AMWAY, which is really success full for more
than 5 decades on selling Health Care, Personal Care, Home Care, Color cosmetics directly to
the customers. Realising the difficulties in the process of marketing & selling every manufacturer
has spent lot of money on advertising, Showrooms, retail outlets and providing samples to
attract the target customers where as Amway doesn’t have such a facilities, but still they remain
at the top, though their products are priced very high. But the actual success is taking place at the
ground level where the IBO’s meeting the customers; IBO’s are really having tough time on
convincing the customers without samples. So the researcher has made an attempt to study the
entire sales & marketing process, satisfaction of their IBO’s and customers.

Scope of the Study

The success and failure of a product or a company is purely based on customer satisfaction.
There is a saying in business circle “A satisfied customer will bring 100 new customers for your
product whereas an angry customer will take 300 customers away from your product”. So
customer satisfaction is a key factor in any business, particularly in MLM Business. In this fast
growing world each and every company is keeping HR Persons to ensure that their employees
are always there in comfort zone whereas in Amway’s case their IBO’s are spread around the
globe. So it’s really difficult to satisfy the IBO”S. So the study has been undertaken to know the
marketing strategy, Products, customer and IBO Satisfaction of Amway & Amway Products. It’s
an attempt to prove the satisfaction status of the IBO’s as well as the customers.

Objectives of the Study

This study was undertaken with the following objectives
To study about Amway’s Successful business Strategy
To study about the customer satisfaction
To study about Amway Products
To study About Amway IBO satisfaction
To Identify the Problems faced by the customers and IBO’s during the sales process
To give suggestions for improving the sales volume of IBO’s with 99.9% customer satisfaction.

Period of the Study

As indicated in the methodology, the processing and analysis of data was carried out for six
months from Nov 2010 to April 2011.
Methodology
For collection of primary data, a well structured interview schedule was prepared based on the
objectives of the study. The data required for the study were gathered using questionnaires. Since
it is a two way transaction the researcher has randomly selected Amway IBO’s and Customer.
Based on the questionnaires simple percentages were worked out to study the customer as well
as IBO’s satisfaction.

Sampling Design
Simple random technique was used to select from Amway IBO’s and Customers living in
Vallioor. This 50 customers and IBO’s well structured interview schedule was fixed A well
structured and printed questionnaire

Data Processing
After completing the data collection, a thorough check was made. Then the researcher has used
computer to form tables. These tables have further analysis of data and interpretation.

Tools Used
Quantitative techniques such as percentage analysis have been used in this study. Five point
rating scale is used to collect qualitative data for further analysis. Chi-square test has also been
used in this study to test the hypothesis developed for the purpose of measuring the satisfaction
level of the IBO’s and Customers. Also other variables like age, income and educational
qualification of the customers.

Plan of analysis
The data are analysed by using appropriate. Statistical tools like percentage analysis and Chi-
square test.
The percentage analysis is used wherever required. The Chi-Square test is used to identify the
factors influencing the customers, IBO’s satisfaction in using Amway products in Vallioor.
Hypothesis
Based on the objectives of the study, the following null hypotheses were framed. There is no
significant relationship between the levels of customer satisfaction and the independent variables
namely
a) Age of the Customers
b) Education Qualification
c) Monthly Qualification

Geographical Coverage

This study covers the Amway IBO’s and customers in Vallioor. Vallioor is located in Tirunelveli
district. Vallioor is between Nagercoil and Tirunelveli. Sri Subramaniya Swamy Temple and
Fathima Church are important scared places in Vallioor.

2.2 THE HISTORY OF AMWAY

What does the word Amway mean? Amway is an abbreviation for "American Way"
and was coined in 1959 by company founders, Jay Van Andel and Richard DeVos. Short, unique
and easy to remember, Amway has been registered as a corporate name and trademark ever
since.

Jay Van Andel and Richard DeVos, founders of Amway

In the following decades, Amway Corporation successfully established itself as a leading

multilevel marketing business, built on strong values and founding principles that continue to
sustain our company today. The business is built on the simple integrity of helping people lead
better lives. We have long had a tradition of opportunity and success.

Today, Amway is a multibillion-dollar international business representing freedom and

opportunity to millions of people in more than 80 countries and territories around the world. We
offer over 3 million Business Owners the inspiration to grow those businesses, and we work hard
to provide new and better ways for them to achieve their life goals.

1950s

A Solid Foundation

Jay Van Andel and Rich DeVos began their business in the 1950s using direct selling to market
NUTRILITE Dietary Supplements. What they discovered more than 40 years ago still remains
true today that people and relationships are at the core of any successful business.

Always searching for new opportunities, in 1959 Rich, Jay and their associates looked for new
product ideas to expand their business. They realized they wanted products that everyone needs,
all of the time products whose features and benefits anyone could understand and communicate
easily.

"The products we want must be ones that just about anyone is familiar with and can sell. The
examples that come to mind are laundry and cleaning products." – Jay Van Andel
The result of their search was Amway's first product, which today is called L.O.C. Multi-Purpose
Cleaner. It was an instant sales success story, opening up a whole new world of opportunity.

With a strong belief in the power of initiative and free enterprise, Jay Van Andel and Rich
DeVos created the Amway Sales and Marketing Plan. They knew that anyone who was willing
to work hard could succeed using the same business methods. This simple idea quickly gained
popularity throughout the US, and then Canada, as more and more people discovered what a real
opportunity the Amway business offered.

1960s

The Early Years

As Amway's annual sales rapidly expanded, exceeding US$500,000 for the first time, the
company soon outgrew its basement office in Jay Van Andel's home. During this time, Amway
moved to a larger facility and began developing new products, including SA8™ Laundry
Detergent, which was launched in 1961.

These Home Care products became big sellers for distributors and led to incredible growth for
the company. Within a few short years, the company had more than 700 employees, over 200
exclusive products and more than 100,000 Distributors. Rich and Jay knew that the best way to
interest people in the Amway business was to bring the opportunity to them. So, in 1963, the
famous "Showcase Bus" began touring many cities throughout the US. Stocked with products
and literature, it helped distributors introduce Amway's growing product line and unique
opportunities to people all over the country.

In the 1960s, the achievement and enterprise of successful Distributors was recognized with the
introduction of Direct Distributor status. It became a model for reward and recognition programs
that continue to be developed in Amway markets around the world.

In the midst of all this success and growth, however, tragedy struck as Amway's aerosol factory
was completely destroyed by fire in 1969.
1970s

A Decade of Growth

After the fire, Jay Van Andel vowed to reconstruct the aerosol factory and to salvage the
business. The factory was rebuilt and sales reached an estimated retail figure of US$100 million.
The Amway product line was also greatly expanded with NUTRILITE™ Dietary Supplements
becoming a best-selling line, and the PERSONAL SHOPPERS™ catalogs continued this growth
and diversification.

By the mid '70s Amway trucks travelled more than 3.25 million miles (approx 5.23 million
kilometers) shipping products to millions of Distributors, At the same time, the company
expanded overseas, opening markets in eight countries on three continents. Amway launched its
second international affiliate half a world away in Australia, swiftly followed by the UK, Hong
Kong and Malaysia.

Amway Japan Limited (AJL), founded in Tokyo in 1979, quickly became one of Amway's
largest markets in terms of product sales. As challenging as it was to enter new markets―faced
with everything from different languages and laws to difficult distribution channels―Amway
continued to grow globally.

At home, in Ada, Michigan, the Amway World Headquarters complex grew rapidly to keep up
with the exploding business. Amway's manufacturing facility grew to more than a mile long, and
really became a self-contained city, with its own power generator, water treatment plant,
recycling facility, shuttle bus service and fire department.

1980s

The Billion-Dollar Decade

Estimated annual retail sales exceeded $1 billion for the first time. Pressed by the demands of
increased growth, Amway expanded its US headquarters in Ada, Michigan and built a new
cosmetic plant where ARTISTRY products are developed and manufactured. It also pioneered an
entirely new product category, water treatment systems, with very successful results. In fact,
Amway's water treatment product line, under the eSpring brand name, continues to hold a top
position in the marketplace today.

In the meantime, the Distributor incentive program was enhanced to provide more rewards to
those Distributors who put greater efforts into growing their Amway businesses.

Always concerned with the environment, Amway was recognized as a corporate environmental
leader and promoter of environmental education when it won the prestigious United Nations
Environmental Programme Achievement Award in 1989.

1990s

The Next Generation

Following in their fathers' footsteps, Steve Van Andel and Dick DeVos succeeded Jay and Rich
as Chairman and President of Amway. At the same time, a new generation of leaders also began
to emerge within Distributor families, building upon and continuing the successes of their
parents.

The 1990s saw continued expansion with estimated retail sales volumes reaching US$5 billion.
In California, Nutrilite's research into the links between diet and health was given a public face
with the inauguration of the Rehnborg Center for Nutrition and Wellness, which gained world
renown and was later renamed the Nutrilite Health Institute.

Amway's growing role in Asia led Amway Japan to sponsor the 1995 Nagano Winter Olympic
Games in Japan. Around the world, Amway's regional and country affiliates continued to support
their Distributors with the launch of e-commerce sites that extend the Amway opportunity into
cyberspace.

This remarkable decade culminated in the 40th anniversary of the organization in 1999.
2000s

New Horizons

In 2000, Amway prepared for a new century and a new exciting era. Almost 50 years after
Amway began, the DeVos and Van Andel families created a new structure to meet the challenges
of this new century. A parent company, Alticor, was established with subsidiaries Amway,
Quixtar and Access Business Group the latter to consolidate manufacturing and distribution for
the enterprise. At the helm of Alticor are Steve Van Andel (Chairman) and Doug DeVos
(President), jointly holding the Office of the Chief Executive. Today each area of the business,
including Amway, has the freedom to build on its strengths.

Amway continues to be a leading company in the multilevel marketing industry. Its fundamental
principle freedom, family, hope and reward hold as true today as they did in the very beginning.

2.3 AMWAY PRODUCTS

They are proud of their products, which generally fit into the health and beauty categories. Their
focus has been on developing products that outshine the competition so that they can give their
IBOs the competitive edge they need to build strong, thriving businesses.

ARTISTRY Cosmetics and Skin Care, Amway scientists and formulators have developed the
complete line of ARTISTRY cosmetics, now ranked as one of the top five prestige cosmetic
brandsintheworld

Along with the beautiful color products for eyes, cheeks, lips and nails, the ARTISTRY line of
skin care products offers entire skin care systems, customized for your own skin, as well as
superior formulations to repair your skin, protect it, and prevent additional damage.

NUTRILITE Nutritional Supplements, NUTRILITE is the world's leading brand of vitamin,

mineral and dietary supplements.(Based on 2006 sales). They are proud to be the only source of
NUTRILITE nutritional products, a respected name in supplementation around the world. Their
vitamin, mineral, and herbal supplements are made from plants grown on their own certified
organic farms in California, Washington, Mexico, and Brazil and manufactured under the
strictest of standards to ensure consistency, quality and safety.

Our best known multivitamin, DOUBLE X (TRIPLE X in Japan) Multivitamin/Multimineral

Supplement, provides the nutrients that might be missing from your diet. And, we combine
natural phytonutrients, the beneficial nutrients found in plants, to create specific supplements
targeted to address your individual needs, as well. We grow most of our raw materials on our
own farms, and we only use raw materials grown on other farms if those farms adhere to our
own strict standards.

Amway Personal & Health Care Products

SATINIQUE and PROTIQUE hair care products, BODY SERIES and G&H soaps, lotions, and
body shampoo, the TOLSOM line of men's skin care products, and the GLISTER oral care
system manage your personal care from head to toe.

NUTRILITE Products

a)NUTRILITE DOUBLE X Vitamin/ Mineral/ Phytonutrient - 31-Day Supply/with Case

186 tablets

Product Features

 Provides your body with nutrients it needs for opt

 More natural plant concentrates than three mass-market multis combined: Advanced
Formula Centrum*, Pharmanex* Life Essentials*, and One-A-Day Maximum

 More plant concentrates than two premium multis, combined: USANA* Essentials and
Pharmanex LifePak* Anti-aging Formula

 You get the reassurance of NUTRILITE's cutting-edge research; plant concentrates from
natural sources, grown to the highest standards; and the nutritional insurance offered by a
great multi

 Kosher and halal certified

b)NUTRILITE Complex for Hair, Skin & Nails 60 tabs

 It's not easy to maintain beautiful skin, hair, and nails in today's world. Everything from
pollution to stress to UV rays adds to the challenge. NUTRILITE Complex for Hair, Skin &
Nails will help you look your best.

Product Features

 Vitamin C is needed for collagen synthesis, which is used to strengthen blood vessel
walls, form scar tissue, and help form a matrix for bone growth.

 Vitamin C also helps in the absorption of iron and is an antioxidant.

 Biotin is a coenzyme and is involved in several of the body's metabolic pathways

including energy metabolism. This product also contains protein, which is used for growth,
repair and maintenance of all body tissues.

 It also contains grape seed extract which is an antioxidant.

 Take 1 tablet daily, with meals.

c) Nutrilite Concentrated Fruits and Vegetables

Eight out of ten Americans are not getting the colorful assortment of fruits and vegetables they
need. Health experts tell us we need at least 5 to 9 servings of fruits and vegetables a day. But
who really eats this much? NUTRILITE Concentrated Fruits & Vegetables captures crucial
phytonutrients from natural fruits and vegetables - enough to equal the amount found in 10+
servings - in just 2 tablets.
Product Features

 Provides more than the five to nine daily servings of fruits and vegetables health
authorities say are needed to reduce risk for a variety of cancers

 Delivers antioxidants to help fight free radicals generated by smoke, pollution, and
exercise.

 Standardized antioxidant and phytonutrient levels are documented on every label

 No added artificial colors, flavors, or preservatives

 WADA compliant

Amway Home Care Products

If it is cleaner laundry, easier dishwashing, and immaculate household surfaces you seek, the
SA8, DISH DROPS, L.O.C. and PURSUE brands will do the job quickly and thoroughly, with
stunning results.

The espring Water Purifier, the ATMOSPHERE Air Treatment System, and the

iCook cookware line round out our portfolio, providing cleaner air, cleaner water,

and healthier meals for families worldwide.

What is Amway? Amway is a well-established company with a solid record of stability

and growth that provides a Business Opportunity to individuals. That opportunity

is supported by a comprehensive line of superb products sold exclusively by

authorized Amway Independent Business Owners around the world.

a)Spring Products

Thespring Water Purifier is the first in-home system to combineultraviolet light technology with
a patented multistagecarbon-block filter to provide the quality drinking water your family
deserves. The spring Water Purifier destroys more than 99.99% of waterbourne disease-causing
bacteria and effectively removes more than 140 contaminants.Other systems treat water spring
purifies it.
B)SA8 GELZYME 1.33L VALUE PACK

SA8 Gelzyme with Natural Softener is a highly concentrated, enzyme-based liquid laundry
detergent with added Fabric Softener. It is a brand that is strong and powerful, yet sensitive and
gentle to clothes and skin. Its innovative Gelzyme Pretreat Technology makes it ideal for pre-
treating tough stains
Pretreat stained area with SA8 Gelzyme Pretreatment Gel (120ml SA8 Gelzyme in 40ml of water
in an Amway Turret Top Bottle)

For Hand Washing:

* Add 1ml of SA8 Gelzyme with Natural Softener per 1 litre of water
* Pre-soak soiled clothes in the solution for 30 mins
* Rinse properly
For Machine Washing (Heavy Washload):
* For large size machines (45-70 liters) -Add 20ml of SA8 Gelzyme with NS
* For medium size machines (30-45 liters)-Add 15ml of SA8 Gelzyme with NS

* For small machines

Benefits

• It cleans effectively even in cold water

• It is specially formulated to remove body oils and oily cosmetic stains from precious delicate
wear.

• It works best on silks, chiffons, wool, lingerie and hand knitted woolens.

2.4 SALES STRATEGY

Since April 1995, Amway (China) Commodity Co., Ltd. in Guangzhou Economic
and Technological Development Zone has been opened, Amway Corporation, the development
in the Chinese market has been a full five years. In five years, Amway (China) as a direct
Marketing company, relying on its unique marketing Strategy and business philosophy,
combined with China's national conditions, out of a healthy and positive development. Amway
(China) Company in the 98-99 fiscal year sales of 6.7 billion, the company started out of a loss,
performance steadily rose, while the company product and image are also increasingly being of
consumers and accepted by society.
        According to a recent survey in Beijing, 58% of the respondents expressed awareness of
Amway, Shanghai, 64%, Guangzhou, compared with 79%; in respondents, the highest positive
Amway Corporation in Beijing, 89 %, 54% Shanghai, Guangzhou, 75%; in Amway products, the
respondents used, an average of 89% of Amway's products have a good impression. Amway's
marketing staff of the public right personal qualities and professional conduct is also a high
degree of acceptance, of which 63% in Beijing, Guangzhou, 53% Shanghai, 42%. As a Japan-
based direct sales of goods enterprises in a short span of five-year period to achieve the above
results, it is not easy. It also inspired me to their marketing strategy in the China market
research, Amway (China) on the Chinese market, what kind of marketing strategy used? The
marketing strategy is how to implement it? To solve the above three questions, this article
primarily through the following three aspects of analysis and hope that these conclusions on the
future development of China's enterprises have some for reference.
        First, the cornerstone: Product R & D
        Amway (China) Company sold products to the non-circulation daily chemical products
mainly because of its unique mode of operation, the company focus more on customers keep
returning, and only really produce quality products in order to retain customers, so Amway
(China) companies from one to enter the Chinese market as the company put the quality of the
product life. In 1995, Amway (China), the formal establishment of factories in less than a year's
time, the company's product will have passed the U.S. Laboratories Inc. (UL) and the British
Standards Institution (BSI) two international authoritative certification bodies rigorous
examination obtained ISO9002 international quality certification, becoming the mainland daily
chemical industry, the first company to receive two authoritative international quality certification
company. This shows that Amway (China), the company's product quality and management
level fully conform to international standards.
        Amway Corporation itself was the first U.S. four largest household cleaning and personal
care products manufacturer. Amway's Artistry Beauty skin care products since its inception in
1968, led the trend of the world, according to the global consumer market Research and
research authority Euromonitor1998 global retail sales survey, Artistry has leapt to the top five
of the facial skin-care products and cosmetics 1. Amway Corporation's world-famous brands of
another Nutrilite nutritional supplements are consistently adhered to grow plants on their own
raw materials, the use of advanced technology, making the effectiveness of a unique natural
plant concentrates, so that NUTRILITE nutritional supplements become the world's authority.
Supports behind this success is the strength of strong Amway Corporation, Amway operates in
97 global specialized laboratories, employing more than 700 professional researchers. In the
Amway (China), Guangzhou factory, a modern factory covers an area of 58,000 square meters,
Amway (China) in a total Investment of 100 million U.S. dollars, of which 80 million U.S. dollars
registered capital has been fully in place. In 1999 Amway Corporation has an additional
investment of 21 million U.S. dollars in China. It is precisely because of its high-quality products,
strong research and management capabilities for Amway to expand market in China has laid a
good foundation for us.
        2, the pillars: sales representatives Store
        Amway's 40 years in the global market, mainly to implement a direct marketing model into
China, a start is also implemented in the same marketing model. However, in 98 years in April
after the State Council ordered a ban on direct sales, Amway (China) Company actively
cooperate with the transformation of national policy, the same year in July to transform
successfully, Amway (China), a self-employed sales representatives to open shop and a way to
resume operations. The shop Business model combines traditional marketing and personal
selling, both consumer convenience store purchases go directly to Amway, but also for sales
representatives to provide a good career development, making the Amway (China) the
company's business to be leaps and bounds.
        Amway (China) Company transformed the new mode of operation eliminates the traditional
Japanese enterprise between the layers of agents and customers with large, medium and small
wholesalers many areas of a part directly from the store instead of; right product publicity and
promotion are also from the traditional corporate media advertising sales representative word of
mouth publicity move. The customer from product knowledge to understand the products,
purchase products, get the product in the entire chain of sales representatives played a key
role, we can say the law could set up an operation and the development of sales
representatives Compliance team is the lifeblood of corporate survival is also the backbone of
the success of Amway. Therefore, Amway (China) company in five years, as best they can for
the marketing team to provide the most favorable conditions for development and the most
powerful business support, and promoting sales representative team fast and healthy
development, Amway (China) all marketing and sales strategy revolves around sales
representative and proceed.
        1, steady advance, the market expansion strategy. Amway products because of the
concentration properties, sales representatives need to provide personalized services talks,
demonstrations, so the company introduced new products in the Chinese market and the city to
the establishment of trading networks, taking full account sales representatives and customer
acceptance, ability to take every step, proceed step by step marketing strategy. Amway is only
95 years in Guangdong and Fujian provinces opened in January, following 96 years, Amway
opened in Shanghai in East China was officially opened regional offices and set up Point
business. In the same year in July, Amway in Hangzhou, Nanjing, also have the opening of
Amway (China) is only in a stable pre-market basis, would consider opening up new markets, so
far Amway's business across the country in 25 provinces and municipalities in China have been
at the national establish a trading network in 33 cities. Amway (China) has also taken the
asymptotic product launch strategy, taking into account the training of sales representatives and
market acceptance, the current Amway (China) launch 1-2 new products each month. The first
listed only five kinds of Amway products, and they are all household cleaning products, personal
care products was introduced, and in 99 years, began to promote Artistry skin care products
and a variety of cosmetic Nutrilite vitamin and mineral food supplements, Amway has been in
the Chinese market has sold four major categories more than 70 kinds of products.
        2, comply with the market price adjustment strategies. With the raw materials import tariffs
and consumption of individual products, gradually reduce the tax rate, coupled with expansion
of Amway's plant after the full use of high-speed production equipment to increase productivity,
last year more than half of Amway's products lowered prices three Zhisi Cheng. To consider the
concentration characteristics of Amway products, adjusted product prices in the market was
highly competitive, affordable products will help by expanding the market, but also conducive to
sales representatives of the business promotion. Prices have gone down sales rise, not fall,
indicating a price adjustment effective implementation of the strategy.
        3, standardized comprehensive personnel training system. As the sales representatives
throughout the country in large numbers, in order to timely and effective operational guidance
for sales representatives, Amway (China) Company presented the monthly sales
representatives in a 'Amway Wonder' monthly sales representatives in order to learn about the
latest company developments, product information. Amway (China) Company will set up outlets
in the city at least once a month Amway Business Conference, business training for sales
representatives or product introduction, to help sales representatives work. Amway (China) in
order to more easily communicate with sales representatives, communication, set up in 99
years, Amway (China) website which provides comprehensive and timely reports to the
company's sales representative and customer trends, product information.
        Amway (China), the rapid development of business one of the most important factor is the
sales representative and Amway (China) Company is the close cooperation between the
partnership, instead of traditional enterprises such as the nature of the company and employees
a simple relationship. Amway Corporation is an important business philosophy: To those who
are willing to work hard to provide practical, hard work and job opportunities. It is precisely
because both sides of this unique partnership, to fully mobilize the enthusiasm of the sales
representatives. Sales Representative will make the greatest possible to improve their
performance, to create their own marketing network, this is the traditional enterprise can not be
compared. Similarly, Amway (China) Company will be given according to the performance of
sales representatives should be entitled to compensation and incentives, the two sides
produced a win-win situation through cooperation.
        3, Environment: Community Business Communication
        In particular, is a multinational direct marketing such a sensitive word of the company, the
company's image is very important. 98 years before the State Department to prohibit pyramid
schemes, illegal pyramid schemes large number of enterprises have emerged, giving Amway
(China) the company's business development has brought a lot of inconvenience, in this case,
Amway (China) Company itself apart from other illegal pyramid scheme companies a important
concepts is to make their integration into the community and become an integral part of social
life. Amway (China) heavily involved in financing China's social welfare services. Since opening
in 1995, Amway (China) companies to participate in the activities sponsored by donors up to
100 items, the amount of more than 12 million yuan donation. It is precisely because Amway
(China) Company actively engaged in women and children's moral education, Culture and
education, environmental protection, poverty relief, social construction, recreational and other
social welfare activities, as well as its compliance management, standardized development
approach, making Amway in China, an excellent reputation and image.
        Amway In addition to making themselves into the local socio-cultural, but also take the
initiative to communicate with local government officials, and exchange visits between Chinese
government officials, enhance friendship, to establish good social relations, Amway (China) the
company's development to create the best environment.

2.5 IBO EARNINGS

Amway is notorious for being deceitful and misrepresenting their figures and true earning
potential for customers (IBOs). The Federal Trade Commission ordered Amway to stop retail
price fixing and allocating customers among distributors and prohibited the company from
misrepresenting the amount of profit, earnings or sales its distributors are likely to achieve with
the business. Amway is required to accompany any such statements (if they do not, please notify
the FTC or other such governing body) with the real averages per IBO / distributor, and should
be easily available on their internet website.
They have been fined for breaching these terms before.
The fact is over 99% of people lose money in all MLM schemes.

Even by only supplying the average earnings, this is deceiving, as 1 high earner can raise the
average of many other people making a loss. Given the resemblance to a pyramid type structure
of the Network 21 and Amway business, it is a fact that ONLY mostly the people at the top make
any money.

The nature of multilevel marketing schemes is that those towards the top of the pyramid (whose
income is derived substantially from the sales efforts of several or perhaps many levels of IBOs
below them) sell motivational courses and literature to people like you for their own profit (this
is how they make the big bucks), directed at people in the lower levels of the pyramid, in the
guise of support aimed at encouraging them to recruit more members and thus to extend further
the base of the pyramid. Such material is known as Business Support Material (or "BSM"),
which is what Network 21 provides, others call it the "tool scam".

Also the official earnings statistics figures they supply often also only state "active" members,
further skewing the figures in their favour. If you were losing money in a business, how long
would you continue to stay an active paying member? You would not, that would be stupid...but
then again, you are talking about weird Amway people, where the make believe is possible. The
fact is the number of non-active members is massive, people leave Amway all the time for good
reason; because they are losing money.
Unfortunately the official figures given do not show the huge amount of people who are not
considered active, or those who leave. If they did, the average earnings would be much worse
than those publicly known, as shown below.

So now we know the "average" earnings is definitely not what most people earn, quite the
opposite.

On top of this, the companies have been examined in court for their deceiving behaviour, and
independent studies have been conducted. One by the Consumer Awareness Institute (based on
Amway's own reports) stating that 99.99% of Amway IBOs lose money, also dont forget about
all your expenses, let alone all that wasted time. That is, only 1 in 10,000 people in Amway make
a single cent or dollar of money!

Now for an example. Consider how many people you see at the front of the stage at a Network
Twentyone seminar conference who claim to be making 60,000 a month!
If you use the above figure of 1 in ten thousand make a profit, this means the average earnings
are more like $6, as the average earnings are split over everyone.
For one person to earn a lot of money, many more make zero, or many people lose money.

Either way 9,999 people will lose money for just 1 to make more than 1 cent! Think about that.

If someone representing their company, or trying to seduce you to join claims how much money
you can possibly earn, don't be fooled and suckered in by their wild claims, use your brain to
clearly think about how they might be playing with the statistics. Instead invest in something
where everyone makes money, not where everyone loses money.