Is Amway a Scam or not?

Amway, like many other Network Marketing or Multi Level Marketing companies, have received a lot of bad press over several years. Which makes one wonder is Amway a scam or not? Can you make money with Amway? Let’s have a look at Amway and also why I stopped Network Marketing and started Affiliate Marketing.

Amway Review

  • Name: Amway (short for American Way) Amway logo
  • Founders: Richard de Vos and Jay van Andel
  • Website URL: www.amway.com and www.amwayglobal.com
  • Price: Variable starting at $62 and upsells
  • Overall Rank: 20 / 100

Product Overview

Amway is an American Multi Level Marketing Company that is based in Michigan. It was founded in 1959 and the products are sold in more than 100 countries. Their sister company is Alticor and the combined sales are in excess of $10 billion. They believe “you are in business for yourself, but never by yourself”. Amway product

The Amway business model is based on individuals that sell their products and earn commission on each sale. It is a combination of direct selling and Multi Level Marketing. Their product range includes beauty, nutrition, personal care and home products.

There are two ways in which you can enjoy Amway products:

  1. as a customer by buying their products,
  2. or as a business owner where you sell their products.

Amway distributors are called Independent Business Owners (IBO). The company generally has a bad reputation amongst Independent Business Owners (IBO’s). The Biggest complaints are that it is difficult to make money, dishonest recruiting tactics and high prices.

Although Amway doesn’t fit into a traditional scam definition, they have been investigated in several countries and by the Federal Trade Commission (FTC) for being a suspected pyramid scheme. Wikipedia has the details of the cases.

Can You make Money with Amway?

There are three ways to earn money: Amway

  1. Selling Amway products with a retail markup and pocketing the margin. The retail margin which you can earn is the difference between the customer cost and the IBO cost. Although Amway has a suggested retail price, IBO’s can set their own prices.
  2. Based on your personal sales volume, personal sales bonuses can be earned.
  3. You can get bonuses from growing your business by building a team and down line who also sell Amway products. Start recruiting and earn points on the sales of the recruits in your down line. Points earn monthly bonuses. The more all your recruits sell, the more you can earn. Additional points mean additional cash bonuses and also incentive trips. Growth Incentives can be achieved if you reach key milestones in your business. Growth incentives are based on the product sales volume of your team and is earned monthly. One-time cash awards and business trips are incentives that can be earned, by reaching key building milestones.

Amway Training

Training on how to sell Amway’s products are available through Amway™ Education courses.

Amway claims they offer free education and training through Amway Education, but also offer additional training and motivational materials that can be purchased. Amway Education includes more than eighty virtual courses and activities.

These are available in five languages namely English, Spanish, French, Mandarin and Korean. Course topics include:

  • Making Money
  • Selling
  • Product Knowledge
  • Business Essentials

The risk to start is low and a 100% refund is offered within ninety days if you are not satisfied.

Teach your team – Amway Amplify is a series of podcasts which is designed to help boost your business. It contains inspirational messages to help your team to overcome setbacks, build their confidence and encourage them to take action.

Product price – how much will it cost you to join?

To sell Amway products, you have to register and sign up under an Independent Business Owner (IBO) There are different business kits for you to choose from:

  • IBO literature Kit at $ 62.00 is a step-by-step guide to starting your Amway business, including brochures, training programs and bonus programs.
  • IBO Product Kit at $83.99: in addition to everything found in the Literature Kit, you also get $ 150 worth of products to try.

Only sixty percent of IBO’s renew every year, which is a sign of the dismal earnings that they get that they don’t return. Annual IBO membership costs $60 per year. Click here to explore a far superior earning potential with Wealthy Affiliate.

Compensation Plan – how much can you earn?

The Amway compensation plan is based on performance and the Independent Business Owner (IBO) compensation plan offers monthly and annual bonuses.

You might also qualify for the Amway “Growth Incentive Program” (GI Program). This is a collection of discretionary programs that vary every year and is separate from the IBO Compensation Plan.

You can increase your potential income by sponsoring and mentoring others to join your team. Amway states that an IBO can earn higher bonuses if they focus on signing up more IBO’s, rather than focusing on product sales.

An IBO’s sales volume is determined by their point Value (PV) and their Business Value (BV). Each product or set of products have a PV. If you increase your sales volume, you can build a higher income. Business Volume (BV) is the dollar value of the products that are sold. Amway compensation

Your monthly performance and bonus bracket is determined by your total PV and BV. This is a list of total monthly PV and the bonus that you can get:

  • Monthly PV of 100 – 299 with BV of $284: 3% bonus
  • Monthly PV of 300 – 599 with BV of $852: 6% bonus
  • Monthly PV of 600 – 999 with BV of $1,704: 9% bonus
  • Monthly PV of 1,000 – 1,499 with BV of $2,840: 12% bonus
  • Monthly PV of 1,500 – 2,499 with BV of $4,260: 15% bonus
  • Monthly PV of 2,500 – 3,999 with BV of $7,100: 18% bonus
  • Monthly PV of 4,000 – 5,999 with BV of $11,360: 21% bonus
  • Monthly PV of 6,000 – 7,499 with BV of $17,040: 23% bonus
  • Monthly PV of 7,500 + with BV of $21,300: 25% bonus

You have to consistently sell products and build teams of successful other IBO’s to earn a sustainable income. Income varies greatly, depending on your efforts, as in any other business.

Amway Ranks and Achievement Levels:

There are numerous ranks and levels. Amway refers to the levels of achievement as pin levels or recognition levels. Amway ranks

  1. IBO is the start
  2. Silver Producer
  3. Gold Producer
  4. Platinum Producer
  5. Founders Platinum Producer
  6. Ruby
  7. Founders Ruby
  8. Sapphire
  9. Founders Sapphire
  10. Emerald
  11. Founders Emerald
  12. Diamond
  13. Founders Diamond
  14. Executive Diamond
  15. Founder Executive Diamond
  16. Double Diamond
  17. Founders Double diamond
  18. Triple Diamond
  19. Founders Triple Diamond
  20. Crown Producer
  21. Founders Crown
  22. Crown Ammasador
  23. Founders Crown Ambassador

To qualify for Diamond Levels and above, you must be an Emerald Bonus recipient.

The requirements to qualify for each level, is very complicated and this is where you can look at the different levels and what you need to achieve to qualify.

Immediate income can be attained if you buy $1,000 worth of inventory each month. If you then sell it for $3,000, your profit is $2,000.

Who is the product for?

Amway is ideal for somebody looking for a side hustle. Most people join to boost their primary income and they do not look at Amway as a career. Amway themselves also say that on their website.

To me that means that you musts not look at Amway if you want to make serious ongoing money. There are far better ways to earn a passive income and here you can read my best recommendation.

Things to Consider before joining Amway

  • Apart from the initial start-up costs, you will also be required to attend monthly and regional meetings, as well as conferences. Amway time and money costsThe costs for attending these compulsory events will be for your own account.
  • It takes a huge amount of money and time to build a successful direct sales business.
  • Monthly sales quotas need to be met.
  • MLM companies like Amway are often very misleading in making it appear to be very easy to make money, when in reality it is very difficult.
  • Products are fairly expensive, making it difficult to sell them at a competitive price.
  • You need to be good at recruiting to build a down line and earn residual income. You need a very large network to make it to the top. To join them you have to sign up under an IBO.

Seems like a Pyramid scheme as the focus is on recruiting, rather than selling their products. Was cleared in 1979 that they are not a pyramid scheme, but close to it.

The Good and the Bad – What I like about them and what I don’t like

What I like :

  • You can work flexible hours to your own schedule – but that is the case with most network marketing companies.
  • If you are not satisfied, you can get a full refund within 90 days.
  • Amway does have a support function where you can network and connect with other Amway distributors. 

What I don’t like: Amway possible pyramid scheme

  • Prospective recruits are presented with inflated earnings potential and deceptive marketing methods.
  • If you don’t sell anything, you will not earn.
  • You have to spend and invest more money to actually make any money.
  • It might take you a very long time to actually see a profit.
  • Amway has been accused of recruiting through brainwashing and using lies.
  • They use aggressive recruitment techniques and cult-like practices.
  • Training is through a series of seminars, recordings and books, most that you have to purchase from Amway.
  • You’re encouraged to sell to and recruit your family and friends and exploit them. There is therefore the potential to lose close friends because of the way the company works.
  • They make promises of spending a little money now for a better life later.

Final opinion of product

Amway has been investigated by various institutions in several countries for allegedly being a pyramid scheme. They donate very generously to the Republican Party in the USA, which is most probably why they have not yet been declared an illegal pyramid scheme.

Part of the negative history of Amway includes being accused of fraud and having to pay out more than $150 million in compensation. That in itself should be a massive red flag why to avoid them.

Only 1% of IBO’s actually make money. There are several stories of people spending several thousand dollars to attend seminars and buy tapes, without getting the returns.

Product at a glance: Is Amway a scam or not

  • Company Name: Amway
  • Founders: Richard de Vos and Jay van Adel
  • URL: www.amway.com and www.amwayglobal.com
  • Price: Starts at $62 and several more upsells
  • Scam rank: 20 / 100

Verdict

So is Amway a scam or not? I would avoid Amway like the plague, like any other company that hides behind a product, but is actually a pyramid scheme in disguise. The mere fact that Amway is on an ongoing basis being sued, should steer you away from them.

Can you make money with Amway? With difficulty and effort that is not worth it. As I mentioned above, only 1% of IBO’s actually make money. My number one recommendation for you, would be to become an Affiliate and join Wealthy Affiliates. This is where you can read my review about them.

If you have any questions or suggestion, please leave them below and I will get back to you.

14 thoughts on “Is Amway a Scam or not?”

  1. I am not a big fan of MLM business models because I had a terrible experience at one point. Regardless, Amway seems like a legitimate company. So many features checks out, like their product line, sales training and refund policy. My problem with MLM models is their success to failure rate. I believe the energy expended to work out a network marketing campaign would be better rewarded elsewhere. 

    Thanks for sharing.

    Reply
    • I agree with you Rhain. I also had a bad experience with a network marketing company, Usborne Books at Home, who I was involved with for nearly 10 years. The only way you can earn more, is by recruiting. With more emphasis being placed on recruiting than sales, it makes them a pyramid scheme, hiding behind a product. 

      Reply
  2. Hey, I enjoy while reading your review on Amway. I found Amway is not scam but very few people become successful in direct selling business. In my views it is really very hard to make money from such sites like Amway. We have to meet one to one. We only earn commission if we sell the products. Now I know only 1% of IBO’s actually make money.

    Reply
    • My experience with Network Marketing is that you can only make money if you are recruiting and building a team. And that is also the case with Amway, if you don’t recruit, you earn almost nothing.

      Reply
  3. Thank you so much for giving us such a wonderful article and I came to know of you through a very nice website that I can do affiliate marketing with. I’ve been doing affiliate marketing for a long time and I’ve already done affiliate marketing on Amazon and I learned about a new site through your article and I was overwhelmed when I searched on Google. So I have decided that I will do affiliate marketing from here and I hope that after reading your article, many will want to do affiliate marketing from here and they will share their experience with you very soon.

    Reply
  4.  I’m glad I found this review. It has really answered all the questions I had about Amway. I think it’s a kind of scam. I remember when I first started my search to earn online, paid surveys was the option I was first made aware of. I must admit though, I had my doubts about this particular survey site. But now, I have more clarity. Definitely, I will share this article on my social media account because everyone should get an idea about Amway. And everyone should be careful. Thanks.

    Reply
    • Amway, like most network marketing companies, is not upfront with their information about how can you make money with Amway. And whether Amway is a scam or not, it is very difficult to make money with them.

      Reply
  5. Thank you so much for sharing such an excellent article among us. our article was interesting and informative. I have got a lot of information about Amway. I joined this Amway company 1 year ago through my friend and I have been working in the company for one year and I have been successful here. Through this company, I have succeeded in selling products today and I have been able to change my life, I have benefited. The product quality of the company is very good. I think other people like me will benefit from working through this company and they can change their lives. I have bookmarked your website so that I can come back to later. Amway is the best network company in the world. Thank you again for sharing such a beautiful post with us and I wish you good health. 

    Reply
    • My sister has been part of the Amway distribution network for more than 10 years, and she still hasn’t made money. She keeps on trying to convince her family to join and we all know that it is almost impossible to make money with Amway.

      Reply
  6. I’ve been to in several Amway’s presentations in my life. As an MLM company, it takes a lot of effort for you to succeed and that success uses not to be sustainable in time. The main issue with this type of companies is that the profit distribution is too much, and whatever gets paid to the distribution structure (Which they don’t like to be called, as they are intended to take off intermediaries to improve the system) goes against either the quality of the final price of the product.

    Only 1% of multi-level marketers are sustainable successful. 

    I’ve taken a look yo your Wealthy Affiliate review and that seems to be a much better and sustainable way to generate profit for me.

    Thanks for a great review!

    Reply
    • At the end of the day the question is can you make money with Amway? I think it is very difficult, if not impossible. Amway is not open in their information to new recruits, which makes me ask the question is Amway a scam or not.

      Reply
  7. Thank you for your post. It is useful for me. I started my online business for a while now and am actively looking for money-making opportunities. A friend recommended me Amway some while again, but I never take time to do the research.

    Here comes your review on Amway, which has all info about the company. Your review is honest and straightforward. I particularly like your description on Final opinion of product. There are so many legal issues with company, which are red flag for any one who have interests in the company.

    It is amazing statistic that only 1% of IBO make money, meaning that 99% of the participates are going to lose money. The answer is clear and loud: don’t touch such business.

    Reply
    • It is very difficult to make money with the multi level marketing business model and Amway is another example that it is only the top few that will actually make money. It is not worth pursuing. 

      Reply

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