Amway - New Versus Old">

The "NEW" Amway Versus The "Old" Amway

Over and over again, I have heard that the justification for the curiosity approach and hiding the Amway name until the last possible moment has been because people have preconceived ideas about the "old" Amway and don't know anything about the "New Amway".

How long must we listen to this lame excuse?

On this page, I am going to look at the Amway sales and Marketing plan from back in the mid 80's and then take a look at AMO systems back then and now.

The Business Reference Manual that I got in the sales kit that I bought in 1991 (yes I still have it) contained the same information that was published in the SA-4400 that was effective Jan, 1987.

Let's first compare "The Plan" from 10 years ago to the one today.

The You-Me-6-4-2 is still the same. It's still based on you doing 100 point volume and 200 business volume, which is just like the current SA-4400. The performance bonus percentages and the levels where they are earned have not been changed. It still shows you earning a $6 performance bonus for doing a 100 and earning $2138 at the direct level. It hasn't changed!

While the PV/BV ratio has not changed much, the cost/retail ratio to these numbers have. From personal experience, I can tell you that back in 92 (or possibly 93) the point value for the vast majority of Amway products decreased and the business volume values slightly increased. This resulted in the average 3% check going from $6 to $8, but you had to spend, excuse me, sell an extra $20-$30 a month just to do your 100 points.

Amway has certainly expanded the product line they offer. But I encourage you to do some price comparisons on the items in the Personal Shoppers Catalog and the consumables offered. A price survey that I did, which you'll find on a later page, and three other independent surveys of different products, show that you will pay about 40-50% at suggested retail and about 30% more at distributor cost than identical items in local stores. You can find these other survey's at Sidney Schwartz's Amway Untold Story site. You will find a link to his web-site on my links page.

Ten years ago anybody could call Amway's 800 number and order products from the Personal Shoppers Catalog, just like today. Back then anybody who lived over 25 miles from their sponsor and anybody over 1,500 points could become a warehouse ordering distributor and order Amway's core-line products directly. It has always been at the discretion of the Direct Distributor to allow this to happen. It is not, as some people have told me, some new innovation that Amway has created.

Ten years ago Direct Distributors were not charged the 4% of distributor cost for shipping. They are still not charged for shipping today. Amway does charge the shipping fee for non-DD warehouse ordering distributors.

Ten years ago, Direct Distributors were pocketing that 4% shipping charge, just like many of them are doing now. Fortunately, I have heard from several distributors who have stated that they are implementing direct ordering for distributors in many organizations. But it really is hard for some directs to give up that extra $600-$800 a month they were getting from the shipping charges. All they have to do for that extra income was have all of their downline come to their house to pick up the products.

10 customer sales were required to earn a performance bonus check back then. Today you need to make 10 customer sales or sell 50 PV to any number of customers. I have heard from several ex-distributors and current distributors who have verified that this requirement is widely ignored. Most of the current distributors that I have heard from feel that Amway's business rules concerning this matter are not important and therefore just ignores them.

Back then you needed to maintain the proper volumes for three months out of the year to qualify as a direct. In the distributor survey conducted by Amway during May 84 - April 85, 38% of all distributors were considered active and about 2% of them qualified at the direct level. This information comes from that Reference Manual I got when I bought my kit.

In the late 80's Amway doubled the qualification period for Direct to six months out of the fiscal year. Look what happened to the percentages ... in the survey conducted April 89 - March 90, 46% of all distributors were considered active...and yet only 1% of them qualified at the direct level. This information comes from the SA-4400 effective Jan 93. This tells me that most DD's were barely meeting the qualifications back then.

The percentages have re-bounded since then. The last survey was conducted April 94 - Mar 95. In this survey, 41% of all distributors were considered active and 2% of them qualified as directs.

I have no idea what the number of distributors in the North American market were back then or now. Getting a tooth pulled without anaesthesia is easier than getting this information from Amway. But let's just consider the percentages. Ten years ago .76% of all distributors qualified as a direct distributors. Today .8% of all distributors are qualified directs. Quite an improvement, eh?

There have been new bonuses added and some have increased, but only for the higher pin levels. Those at the bottom of the distribution force have not benefited from these bonuses.

Amway has expanded into many new foreign markets and that has certainly been a major factor in their increase in sales over the past several years. Certainly from a corporate standpoint, this has been very profitable.

It's also been very profitable for direct distributors and above. Unless you can afford to fly to that foreign market and actually start an Amway business in that country, your contacts will work with a foreign sponsor. They will derive all the income from their volume until they hit the direct distributor level. Then the foreign sponsor will get 2% of their volume as a leadership bonus and the other 2% comes to the U.S. Only a direct distributor can receive a leadership bonus. So if you are excited about the possibilities of a large international business, remember, that the only way you'll profit from this is to be in that 8/10 of 1% who qualify as a direct.

So what's changed? It's the Amway Motivation Organizations. Back in the late 60's and early 70's, many distributors realized the importance of having a training and support system. So a system of opens, seminars, rallies and weekend functions was created. Information started being shared by books and cassette tapes and it has now expanded into CD's and video tapes. Every organization's techniques may be a little different, they may use different facts and statistics (many times false and misleading), they may use different tactics, but they all have one thing in common -- a "system".

It didn't take the higher pins long to realize that a substantial amount of money could be made off these systems. So much that Double Diamond Brig Hart estimates that 70% of Dexter Yager's $40 million a year income comes from the sale of BSM's. It's so lucrative that Double Diamond Brig Hart could get ripped off an estimated $50 million by "unethical and deceitful" tactics by his upline and downline and still live a luxurious lifestyle.

Maybe these books, tapes and functions do help some people, maybe they do "increase PV". Just never forget that in many cases over 50% of the income of a diamond or above comes from the sale of these BSM's.

So when you hear some advice that you should buy a book, buy a tape, or attend a function, ask your yourself "What is the agenda of the person presenting this advice?" or "How much of a profit motive is involved with this advice?"

The secret to success in Amway has always been the books, tapes, and functions that are sold to distributors and it's the "selling" of these secrets that has made many distributors so successful.

This hasn't changed in years!

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