While Amway/quixtar plan is very clear and says exactly how much you will get paid at each level, what your upline will never tell you are the hidden costs.
When you first hear the plan at the open meeting, you will hear things like "You just redirect your buying power. Take $250 you are spending outside in wal-mart, costco, grocery stores, and buy from your own store. You have no employees, no overheads, no running costs. You shop and refer others to shop. You make $2700/month." Also they tell you,"In the next 6 to 12 months, working anywhere from 8 to 12 hours per week, you can reach platinum and make $2700/month." (Read my other post on how much platinums really make.)
Here is the truth.
If you have to get REALLY committed and become someone who is going to be the NEXT PLATINUM on the team, then here are your actual additional expenses for your business:
(1) If you have only one car and you are a couple, then you will think about a second car, so that your wife can do retail. While this looks appealing and gives you both more mobility, if your wife is already not selling products then it will put a big hole in your pocket.
(2) Most likely you will be driving around your town in evenings and weekends and may "prospect" in different stores in different locations. It will easily put 10 to 30 miles per weekday.
(3) If you have a group that is 6 to 8 hours away from where you live, you need to drive there on weekends... to show your commitment, you will start driving on Friday night and reach there Saturday morning super exhausted.
(4) If you get a group in a place like California and you are sitting in New Jersey, then you will need to fly there sooner or later...
(5) Based on the experiences of one of my downline IBOs: if you are sitting in California and your uplines are all in New Jersey, then you need to fly to many leadership events in NJ. These will be for very insignificant pins, like 600 PV or 1000 PV or eagle, where you don't even make as much money as it takes for your travel and leadership event ticket. Sometimes you need to attend a big function that is on the other side of the country!
(6) You do 150 PV as single IBO and 300 PV as couple - that is a CORE requirement. If you are not selling at least 50% of this (most IBOs don't even sell 50 PV, forget about selling 50%) then you will be spending $450 as single and $900 as couple per month, not the $250 they show. If you do a careful analysis you will see that to get one PV you will be spending close to $3. Quixtar/amway says this in their documents, but your upline and the education system will not.
(7) Shipping costs have increased... for an order I placed last month for $300, I had to pay close to $30 for the shipping.
(8) Standing order is minimum wage. Lot of nice CDs will come on leadership standing order. You will slowly get onto it. Put $7.50 plus tax per week.
(9) If you show more commitment, then you will get on WWDB standing order. So add another $7.50 plus tax per week. And, oh! you need to buy extra story CDs, Power Wave, lit packs, DVDs, PNAsheets, etc.,
(10) You will need to change oil in your cars more frequently, if you drive a lot of miles. In my upline's case, he was driving 35000 miles per year on an average. His work is 5 miles from his home, so he could not have put more than 3000 miles for his work!
(11) Gas price - you will easily be spending $100 to $200/month for running around your town, doing your "4 basics" and meetings.
(12) Laundry: you need to be crisp and sharp all the time because you don't know when you will meet your next diamond, right? Also you may need to invest in some nice clothes. And oh, you need a suit, tie, and nice shoes. Your spouse may need a couple of nice dresses too! This may be good for you, but these costs are all HIDDEN.
(13) If you have one or two downlines coming around, then be ready to buy more products for doing grand openings in their home.
(14) Samples - you will give lot of samples to prospects! my experience was less than 10% of the people actually place an order. About 50% of them never try your products. And, oh do not forget the catalogs - they do not get you any PV, but you need to buy them to give to others!
(15) Factor open meeting attendance charge. Typically $4 per person or $5 per person. If you are doing with spouse, then double.
(16) Function expenses: ticket costs $95 to $105. You need to stay in hotel for 2 nights. If you prefer privacy, then you spend close to $200 in hotel, $200 in tickets and another $50 for food, coffee, etc., Most likely the function will be a long drive - bus drive means $55 to $100 per person and if you drive your own car, then factor the miles.
(17) Meetings after the meetings, night owls: if you go to Dennys, Diners, or anywhere after your meetings, then you cannot simply sit and not order something. If you do, you will be scolded indirectly at the next open meeting at the training. So you will spend a few bucks there - at 12 midnight putting on more calories in your system.
(18) Communikate: about $35/month.
(19) New addition: web space, BWW TV - another $25/month.
(20) If you do not want bww.com email address (because your prospect can figure out you are an amway IBO) and prefer your own domain name email address, then you pay another $50 per year.
(21) S.A.M. - this costs about $600 plus shipping. the skin analyzer magnifier machine... if you are not selling Artistry products, till now, YOU WILL GET THE MOTIVATION after you buy a S.A.M. machine!
(22) WORST: if you are a fake platinum or gold or silver, still you need to go to GO DIAMOND... the big event for the real leaders and the real men and women - so factor flight charges, ticket charges, hotel charges, food expenses, rental car expenses and since it may be in an exotic location like Florida - you may be tempted to visit the theme parks and spend more money. In my opinion, the big leaders who conduct these functions, should really allow only people who made at least $20,000 the previous fiscal year to attend these events. But you see, half the people won't come to GO DIAMOND anymore then and whoever is profiting from these events will not make the money.
In my experience, I have seen people spend anywhere from $2000 to $2500 per month just to maintain a small 5 to 10 people business, which makes $300 to $400/month. Only 5% or less of the IBOs at the meetings actually qualify eagle within the first one year, even though you are supposed to reach this level within the first 3 months. Many who qualify eagle do not re-qualify the following months. Are people so dumb that they cannot build this fast or is the system really not working?
So am I telling you should get out? No, go ahead and build it properly by selling products and building a huge team and actually making a profit after all these expenses. Then come back and comment here.
Till then,
run around in malls trying to smile and ask someone "Are you from such and such place/country/university?" "You look familiar. Have we met before?" etc.,
feel sick at the functions, BBS and the open meetings,
fight at your home,
miss your children,
tell many different lies and lie to your parents and others telling how much money you are making with your business,
have many sleepless nights,
have close to zero savings account,
do not talk to your relatives who are negative,
do not take any vacations,
do not do anything for fun without feeling guilty,
have wet palms every time you go to any store,
< add anything else that makes you feel sick >
Great post. You see as per the famousa saying that goes within the business "COMMON SENSE IS NOT COMMON". So the facts are right there in front of the IBO's- their expenses for the business..oh sorry "investement" and their income from the business, but u c, in this business FACTS DON'T COUNT...so IBO's continue to loose money and stay in the business, for everything else(like belonging to upline's inner circle, for the associations, for the fear of being called a looser if they left the business, etc etc) except make money.
ReplyDeleteKeep it going. The truth behind the supposedly low investment business should be exposed
Hi, pity that it's shown clearly the immaturity in the knowledge you and the co-commentor has made. You certainly have to read a book 'magic of thinking big'. ABC of this business is nothing but associations, books and CDs. If you want to become rich by dreaming at home wanting to become rich, be a guest to yourself. I still strongly recommend you to rethink where you left out. You need to understand three basics of this business - time compounding, duplication and delayed gratification. Leaving the business almost on the verge of doubling is what you have lost out on. Please re-think on these grounds. I am just a person who has done research on multi-level marketing and am commenting based on my research and recommendations.. All the best regards.
ReplyDeleteAnon on 10/12/11. It clearly is obvious that you have not been in the MLM business for too long. Try practising delayed gratification for 6-7 years without making a whole lot of money out of this. Then will see what your response is.
ReplyDeleteThis person is like people who write on public wash-room. People read it but has no creditability.
ReplyDeleteDude come on. You dont need to be a celebrity to express your thoughts. The author has given a very nice analysis of the all the expenses. Math is Math. So do it for yourself.
ReplyDeleteWhen you started to develope this opportunity why? What was biggest dream? What was your motivation? Thats what you hold onto...
ReplyDeleteI held on to motivation, did everything my upline emerald said, and still lost money. I kept my IBO number and order products each month, but quit the meetings, quit the tapes and quit the money bleeding.
ReplyDeleteI know by now that I am crossing by this post while searching for other information, it's been close to 2 years, so where are you know? if you had decide to get people on your team and just tell them to do exactly what you said at the end of this post, where do you think you would be by now? Personally, I don't know, I don't think any body knows, but one simple look it tells me this, you where not spending much anymore, building a team of IBOs doing what your doing may put you at BETTER position than having NO BODY but yes it is my very OWN opinion.
ReplyDeleteI really hope you doing well