Amway is an American Multilevel marketing company founded in 1959 by Jay Van Andel and Richard Devos. It sells healthcare, homecare, beauty care products, and many more. Amway aims to help people start their own business with a low startup cost, providing access to exclusive products and a 100% satisfaction guarantee.
Amway-A Short Introduction
Amway is the world’s largest direct selling company that reported $8.8 billion in sales in 2018. They sell health care, personal care, home care, and many more products across 100 countries through Amway Independent Business Owners(IBOs).
Amway is not only a direct selling company but also embraces the manufacturing and R&D of new products across America. It has invested $335 million in the past seven years on this and owns one million square feet of land with plants in Michigan, California, and Washington. It has also secured more than 800 patents.
Amway has a huge number of products that range from health supplements and Beauty products to laundry detergents.
Among all other MLM companies out there, Amway has one of the highest products on the planet. Further, when I checked the prices, the products are quite expensive. The company claims it’s because of the quality and research that goes into manufacturing these products.
Amway product categories include:
- Nutrition – Vitamins & supplements, weight management, sports nutrition, and energy drinks.
- Beauty – Skincare, makeup, and more.
- Bath & Body – Haircare, body care, and oral care.
- At Home – surface care, Laundry, dish detergent, cookware, and more.
- Fragrances – Several selections from Personal Accents.
- B2B Products – cleaning, Commercial-size agricultural, and laundry products.
3 Ways to Make Money with Amway
- Retail Margin – The IBO can buy the products at the ‘Special IBO’ price and sell at their determined price. The difference is called the Retail Margin which is held back by the IBO.
- Bonuses – Each product sold will incur performance points. The IBO’s points and the consecutive downline IBO’s points within the team are accumulated to earn Bonuses.
- Incentives – On reaching the monthly or Annual targets, the IBO’s are rewarded with incentive programs like trips or cash rewards, etc.
How to Become an Amway IBO?
You can become an Amway Independent Business owner by choosing one of the following plans.
- IBO Literature Kit costing $62.
Includes a detailed guide to start your own business with Amway, brochures, and training programs, as well as information about the company’s bonus programs.
- IBO Product Kit costing $83.99.
Includes everything found in the Welcome Kit, in addition to $150 worth of full-size products that you can try.
Each time an IBO purchases a product from Amway, he earns a few points called Point Value(PV). For eg, if IBO purchases $100 worth products, he would get 1 PV which on accumulation would result in a commission of a certain percentage.
How Amway Compensation Plan Works?
Initially, you need to get registered with Amway as a brand-new Independent Business Owner(IBO). Here you need to sell more and products to get a relatively good commission.
Amway Business Plan
Amway has two revenue streams, direct selling, and multi-level marketing. The company follows the compensation plan, which is the oldest type of MLM compensation plans. There is a header which says “We Are Our Own Bosses” which seems to be quite appealing.
The plan consists of different levels of career paths. The first stage is becoming an independent IBO, who attains the further following levels.
- Silver Producer
- Gold Producer
- Platinum Producer
- Founders Platinum
- Founders Ruby
- Founders Sapphire
- Founders Emerald
- Founders Diamond
- Founders Executive Diamond
- Double Diamond
- Founders Double Diamond
- Triple Diamond
- Founders Triple Diamond
- Founders Crown
- Crown Ambassador
- Founders Crown Ambassador
For instance: If an IBO purchases $1,000 worth of products each month and sells it for $3,000, then your immediate income for the month is $2,000.
If you are an IBO, each month you purchase a product for yourself, that becomes your PV (Personal Volume). When you introduce a new IBO it adds to your PV and rewards increase accordingly as this is the root on which the growth of turnover is achieved.
As the volume increases, the bonuses also increase until the IBO reaches the next level like Diamond or Emerald. As the commission also increases starting from 3% and goes higher till 21%.
Recently, India has become the third-largest market for Amway over the last 10 years. This is because of the direct selling major embarks on a new omnichannel strategy which is applicable later this year. As per the survey, China tops Amway’s global market with annual revenue of USD 2.5 billion. India ranks in the seventh position below Korea, the US, Japan, Thailand, and Taiwan.
Amway Money-back Guarantee
The budding entrepreneurs who wish to join with Amway have to buy a $62 kit inclusive of all the required materials. The kit comes with the following:
- A step-by-step guide to help distributors understand the business, products, training resources, and details on bonus programs
- Marketing support
- Direct sales tips
However, Amway provides a flexible 100% money-back guarantee for the first 90 days.
Amway Pros and Cons
- Amway is one of the oldest and largest network marketing companies which does approx $9 billion annual sales.
- A wide range of products which are well made and are top-selling.
- The business plan is very attractive with good profit-sharing policies. The mentors are also said to be very supportive.
- The pyramid scheme is a little disappointing
- The product’s costs are very high.
- New people cannot earn quickly, they need to invest more time and money to start their earnings
Amway announced its partnership with FMCG conglomerate ITC Ltd on May 28, 2020, in the wake of increased customer interest in the health and nutrition space. It started with the launch of the B Natural + range of nutritional juice developed by ITC and will be distributed on Amway’s strong direct selling network in India.
The recent launches include the products designed to address the people under the age of 35. They include
- Nutrilite, launched in Korea, Japan, China, and the U.S, addressing the top concerns of young customers such as sleep, stress, focus, vision, and immunity.
- Artistry studio, a limited collection of on-trend make-up and specialty bath and body products inspired by cities from around the world. The brand has launched three collections featuring New York City, Paris, and Bangkok, with the next launch awaiting in Tokyo.
- CBD cream and CBD cooling spray, just launched in the U.S., and the first similar CBD products slated to launch in the other markets in 2020.
Amway is no doubt a great company with a wide range of products that are used in everyday life. The Amway sales and marketing plan are at low risk and the business opportunity is open to everyone. The compensation plans are also attractive but require more time and money to be invested in.
Many people refer it to as a pyramid scheme and also consider it as a scam. But it is very hard to conclude it as a scam.
- Why is that we don’t hear more about Amway products?
Amway products are exclusively sold through Business owners only on the website, no distributorship or retail sales are provided.
- Why do I Have to pay to be an active member of Amway?
Amway Claims to collect annual Registration fees to maintain the expenses of the resources of the company to run the business effectively.
- Why Just not But Products? Why do Join Amway Business?
Amway Business gives users an opportunity to earn extra when a product is sold under the reference of someone. People have the opportunity to have an alternative profession.
- What is the difference between MLM Marketing and Pyramid Scheme?
MLM Marketing is something that rewards reference commission on product selling where’s the Pyramid Schemes tricks to reward money on referrals.