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From: topher@cyb-eng.UUCP (Topher Eliot)
Newsgroups: net.consumers
Subject: AMWAY experience and opinions
Message-ID: <709@cyb-eng.UUCP>
Date: Thu, 12-Sep-85 19:59:08 EDT
Article-I.D.: cyb-eng.709
Posted: Thu Sep 12 19:59:08 1985
Date-Received: Sun, 15-Sep-85 10:03:02 EDT
References: <772@gitpyr.UUCP>
Distribution: net
Organization: Cyb Systems, Austin, TX
Lines: 69

I once got conned into going to an organizational meeting (and I do mean
conned, I got asked out for "an evening with a bunch of friends", driven to
a city 75 miles away, and never TOLD what was going on until I figured it
out, but that's another long story).  I hold no animosity towards the Amway
organization for the unfortunate behavior of this particular nitwit.  I did
get the opportunity to see how their system worked.

Consider this:  if all other things were equal, would you prefer to
purchase the kinds of things that Amway sells by ordering them from a
neighbor or friend and waiting for them to arrive (ok, some big-time Away
salespeople actually stock some stuff, so all you have to do is catch them
while they're at home, and MAYBE they'll have what you want), or by picking
them up at the supermarket?  I prefer the supermarket.  How many people do
you know that would prefer the ordering method?  I can tell you how many I
know -- exactly zero.  Which means to me that whenever an Amway product is
sold, it involves somebody buying it because Joe or Sally here sort of
pressures them into doing so, through whatever means.  Reason number one
for disliking Amway.

Consider how much markup the guy on the bottom of the pyramid (let's not be
shy, that's what it is) makes on a given sale.  Is that enough to satisfy
you?  Would you be content just selling to your neighbors (or yourself, but
I am not convinced that even their "wholesale" prices are particularly
competitive).  Probably not.  Which means you want to build a pyramid to
get rich.  The way they have it set up, a tall skinny pyramid with few
items being sold at the bottom doesn't get you much money.  You have to
arrange it so that the combination of all the people under you (including
yourself) sells considerably more than any given one of the people under
you (not including yourself).  You get rich from the difference.  This
leads to bushy trees.  In other words, the way you get rich is by leaning
on (convincing, fast talking, describe it as you will) other people to be
in your pyramid -- people who will in turn lean on others to buy this
stuff, and/or be in their pyramid.

The bottom line is that there are a few guys at the top getting fabulously
wealthy (I don't say this lightly, Amway just bought a chain of luxury
resorts), making all their money because they've figured out how to run the
only pyramid scheme that is considered legal (because people do, after all,
sell the stuff, and money is only made from selling products, and YOU do
not make money JUST from signing up other people), and the net result is
lots and lots and lots of people being pressured into buying stuff in a
way they would prefer not to.

Funny how in that meeting they never mention how many people sign up and
then later drop out or peter off into just selling to themselves and maybe
one other person.  I think that a lot do, because those are the people who
realize that leaning on others to buy this stuff in this inconvenient
fashion and/or hunting around for people to be in your pyramid is unpleasant
and (I think) unfriendly.  The brass-plated ones stay in, and (just maybe)
get rich.  How do you see yourself?

On the subject of whiteboard technique, one exercise they run through (wish
I could remember it's name) is proving that "they're not a pyramid scheme,
you have to SELL THE STUFF to make money."  They show that if you get one
hot-shot salesperson directly under you (and no or little other sales), you
will not benefit particularly from the salesperson's sales.  That's true if
you get ONE.  But if you get MORE than one, you benefit from their sales.
The more, the better.  So it is to your benefit to sign up people who will
sell, or convince others to sell.  You do not get rich by selling, but by
convincing others to sign up.  This fits my definition of a pyramid
scheme (and yes, as I recall, you do pay some money to join up).

If I knew you had signed up, I would decline any social invitation you
issued to me (i.e. for a party or dinner), knowing that you might then lean
on me to sign up.  I've had enough of that, thank you.

Cheers,
Topher Eliot                Cyb Systems, Austin, TX               (512) 458-3224
      {gatech,harvard,ihnp4,nbires,seismo,ucb-vax}!ut-sally!cyb-eng!topher


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