Hey there sea changers, and welcome back to my series of MLM reviews. Today we are going to to look at one of the most famous of them all with my Amway MLM Review. To be honest, this is a program than I can’t believe I haven’t covered before now as it is probably the first network marketing exposure I had in my life. I mean it was watching my parents avoid friends of theirs who were ‘into Amway’ but nonetheless, it was still the first time I was introduced to anything such as this.
So, what is the Amway MLM all about? Let’s have a look and see…
What is MLM?
Multi-level marketing (MLM) programs are the traditional mainstay of the ‘party plan’ world of products such as Tupperware, Mary Kay and of course, Amway. And in spite of its history, MLM has grown rapidly in recent times – mainly due to the fact that much of the sales and marketing is now being managed online – with many new companies in many different niches getting in on the action.
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The ‘multi level’ aspects of MLM come from its hierarchical nature in which you make commissions based not only on those that you sell to, but also the sales of those whom you ‘sign’ into membership arrangements as well.
In short, the process works as follows:
- You join the program, either via referral from another person (known as your up line) or directly through their website.
- You promote the products of the company via parties, workshops or online.
- As you make sales, you offer incentives to your customers to sign up as a member of the program (there are different names for this but they all mean the same thing).
- That new member is then placed ‘underneath’ you in a hierarchical arrangement (known as your down line).
- You, and a number of levels of your up line, then gain extra commissions for everything they sell as well.
- If they manage to refer their customers into memberships, they also become a member of your down line allowing you to make up line commissions as well.
The number of levels of your up and down lines will vary depending on the program you have joined. Commission rates will also change as your down line grows or contracts and many will also offer other incentives such as total company sales percentages and/or access to membership prizes as your own business grows.
Who is Amway?
Amway was founded by Jay Van Andel and Rich DeVos in 1959 and in the years since have grown to become the “world’s largest direct selling company” and a fixture within the top 10 selling MLM programs. They run factories in three US States to manufacture and distribute nutrition, beauty, personal care and home products to over 100 countries worldwide.
Amway is based in Ada, Michigan in the United States.
What do they sell?
As above, Amway offers a massive range of nutrition, beauty, personal care and home products including:
- Vitamins & Supplements
- Weight Management
- Sports Nutrition
- Energy Drinks
- Skin Care
- Artistry™ Beauty App
- Bath & Body Care
- Hair Care
- Oral Care
- Air Treatment
- Disinfectant Cleaners
- Surface Cleaners
- Water Treatment
Due to their size, they are also well-known for their exclusive brands including:
- n* by Nutrilite
- Artistry Skin Nutrition
- Artistry Studio
- Amway Home
MLM Program outline
The Amway MLM program calls their members ‘Independent Business Owners’ (IBOs) who are part of a somewhat traditional, if not a little confusing, compensation plan. Here are the basics as I have found them…
Base Commission rate: Up to 30%
Down line commission rates: 3 – 21% based on total sales of downline
Minimum monthly spend to qualify for commissions
To qualify for downline commissions, IBOs are required to meet monthly PV targets of at least 100 per month to earn the base 3% commissions. This can be made of personal or customer sales.
Payment terms: Monthly.
Application required?: Yes, Application form on website.
Purchase requirements to join: Yes
From what I can see in the FAQ section, there looks to be a joining fee of around USD$100 that “covers the cost of resources Amway provides to help our Independent Business Owners effectively run their businesses” including ongoing education, training, product marketing materials, customer service and mobile business management tools.
Marketing materials provided: As per starter kit above.
Within most MLM programs, rankings and commissions are determined by the total personal volume (PV) generated by the IBO and their down line (measured in BV) within a calendar month with points assigned to each product. These point allocations can range from 50 to 100% of the retail price of each product (before tax and shipping) and vary from item to item and currency of sale.
In the case of the Amway Global MLM program, I was unable to locate any information as to how PV is calculated directly within their compensation plan in terms of BV, they do provide the following:
All Amway Products are assigned two numbers: Point Value (PV) and Business Volume (BV). Point Value is a numerical quantity assigned to each product. Business Volume is a monetary amount assigned to each product.
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How can I get paid?
Ok, so from what I can garner from the compensation plan, there are 5 ways in which IBOs can make money when they promote and sell Amway products. As above, the compensation plan is a little confusing however as it all washes out, they are fairly straight forward as follows (that said, please do not hesitate to comment below if my information is inaccurate):
1. Retail Margin
These are the base commissions earned by the general day to day retail sales that IBOs can generate via parties, popups, social media or however else they can sell Amway products. The Retail Margin is based on the difference between the IBO purchase price and the retail price and averages around 30%.
2. Performance Bonus
Performance Bonus is Amway’s basic version of traditional downline commissions in that payments are made based on a monthly accumulation of PV and BV points. These commissions are paid as follows:
The Leadership Bonus is paid to IBOs who can meet the following:
- Register one group that qualifies at the 25% Performance Bonus level and generate an additional Award Volume of at least 2,500 PV in the same month, or
- Register 2 or more groups that qualify at the 25% Performance Bonus level for the month.
4. Monthly Depth Bonus
The Monthly Depth Bonus is a generational bonus arrangement in that it is computed from the top down, starting with second level qualified IBOs and extending downline until reaching the first level that owes a Monthly Depth Bonus to another IBO. The base amount of the Monthly Depth Bonus from a single Group is 1% of the BV of all qualified downline IBOs. To qualify, IBOs must meet the following:
- Register 3 or more groups that qualify at the 25% Performance bonus level for the month, and
- At least one of those IBOs registers one or more that qualify at the 25% Performance Bonus level for the month.
5. Annual Bonuses
Each year, Amway sets aside money to fund three annual bonuses: the Emerald, Diamond and Diamond Plus Bonuses. Each fund receives an amount equal to one-fourth of 1% (.0025) of the total company BV. In addition, the Emerald and Diamond funds include one-fourth of 1% (.0025) of qualified international volume.
Amway, as with most MLM programs, uses ranking structures on which to base commission payments and other bonuses upon. Rankings for the Amway MLM program are not listed in tabular form so as an example I have included the requirements for the lowest and highest ranks within the program :
Again, as is common with almost all MLM programs, rank progression is determined by both the number of members within the IBO’s downline, and the total sales made by those members per month. Ranks can rise and fall based on the ability (or dis-ability) to reach the required member and sales targets.
What is good about it?
So, after a good look around the site and looking at all the options I could find, I do like the following:
- Good commissions for base sales.
- Well known brand.
What is no so good about it?
There are also some things to be aware of including:
- There are some joining costs.
- Sales targets are required for most commissions.
- Compensation plan is a little confusing and does take some reading.
How much can you make?
Amare Global provides an income disclosure statement on its website as follows:
As we can see from the above and as with most MLM programs, the percentage of members making the upper rank levels – and hence earning a living – is very low (usually less than 1%).
My final thoughts
Look, MLM is not an easy platform to make money in and there is not much that I have seen here to put this program above the many others I have seen. It is definitely in the old school range of things and I will say that I did notice in my research that the compensation plans do look to differ from country to country. The U.S version that I used also lacks some of the bonus options of many of the more modern programs.
Once you have joined, there are not the usual financial pressures of needing to make minimum personal purchases in order to qualify for base retail commissions as long as you can make them within your down line. The downside here however is that you cannot earn downline commissions without meeting sales targets meaning you may also need to bump up your personal purchase quota if customer sales alone are not enough for you to maintain rank.
I guess the only other thing to consider here is that as it is one of the ‘originals’, Amway does tend to draw more negative connotations than most other programs however if you are passionate about the products, then you can be assured that you are working within a tried and true network marketing program.
So there you have it, my honest review and appraisal of the Amway MLM program. I hope it has been of assistance but as usual, if you have any questions or experience with this program please do not hesitate to reach out by commenting below – especially if any of my information is inaccurate.
Are there any other programs you have been looking at but want to know more about? If so, please comment below and I will do my best to get some details for you.
Do you want further assistance with any of the above or need help to build your own nutrition, beauty, personal care or home products based website?
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Until next time
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