Let us move on further on the role of intermediaries of Amway as there is a stone-wall silence on the fraud of foreign direct investment (FDI) in India. Let us take it for granted that the Amway lied to the Andhra Pradesh High Court regarding the FDI in India. And as per the meaning of direct sales, Indian Federation of Direct Selling, which is an independent body, defined its own version of direct selling and the members of the Federation are only bound by it. Direct selling means only direct selling goods and services to the customers. There is no question of ignorance or arrogance.
Before citing the number of intermediaries in the Amway business model, let us look at the various incentives/commission/profit paid from the cost of Amway products to the intermediaries. Profit @ 20%, maximum peformance @ 21%, leadership commission @ 4%, Ruby commission @ 2%, monthly depth commission @ 1%, Emerald commission @ 0.25%, Diamond commission @ 0.25%, Diamond Plus commission @ 0.25%, Founder's Achievement award Rs. 6 lakh - Rs. 264 Lakh, Founder's Distinguished Service award Rs. 240 lakh - Rs. 960 lakh and All expenses paid-up trip to Peter Island at a substantial cost. In essence it can be safely said that out of the price paid by the end-consumer approximately 49.75 per cent goes towards incentives/commisisons mostly to the IBOs in the upline or top level and the inherent costs incurred by Amway in awarding Founder's Achievement award and Founder's Distinguished Service awards. Moreover, the expenses of paid-trips to Peter Island also included in it. Now it is irrefutably and conclusively proved that more than 50 per cent of the cost paid by the end-consumer for Amway products is spent to enrich the toplevel IBOs besides Amway. To be precise most of the expenditure incurred by the end-consumer of Amway goes into the hands of the top few IBOs and Amway. This is totally contrary and inconsistent with the philosophy of saving additional costs.
Now let us list out the titles/names of intermediaries--Silver Producer, Gold Producer, Platinum, Ruby, Founder's Platinum, Founder's Ruby, Sapphire, Founder's Sapphire, Emerald, Founder's Emerald, Diamond, Founder's Diam ond, Executive Diamond, Founder's Executive Diamond, Double Diamond, Founder's Double Diamond, Triple Diamond, Founder's Triple Diamond, Crown Diamond, Founder's Crown, Crown Amabssador, Founder's Crown Amabassador. In all there are 22 intermediaries who line thier pockets with the price paid by the end-consumer.
More in the coming episode.
Before citing the number of intermediaries in the Amway business model, let us look at the various incentives/commission/profit paid from the cost of Amway products to the intermediaries. Profit @ 20%, maximum peformance @ 21%, leadership commission @ 4%, Ruby commission @ 2%, monthly depth commission @ 1%, Emerald commission @ 0.25%, Diamond commission @ 0.25%, Diamond Plus commission @ 0.25%, Founder's Achievement award Rs. 6 lakh - Rs. 264 Lakh, Founder's Distinguished Service award Rs. 240 lakh - Rs. 960 lakh and All expenses paid-up trip to Peter Island at a substantial cost. In essence it can be safely said that out of the price paid by the end-consumer approximately 49.75 per cent goes towards incentives/commisisons mostly to the IBOs in the upline or top level and the inherent costs incurred by Amway in awarding Founder's Achievement award and Founder's Distinguished Service awards. Moreover, the expenses of paid-trips to Peter Island also included in it. Now it is irrefutably and conclusively proved that more than 50 per cent of the cost paid by the end-consumer for Amway products is spent to enrich the toplevel IBOs besides Amway. To be precise most of the expenditure incurred by the end-consumer of Amway goes into the hands of the top few IBOs and Amway. This is totally contrary and inconsistent with the philosophy of saving additional costs.
Now let us list out the titles/names of intermediaries--Silver Producer, Gold Producer, Platinum, Ruby, Founder's Platinum, Founder's Ruby, Sapphire, Founder's Sapphire, Emerald, Founder's Emerald, Diamond, Founder's Diam ond, Executive Diamond, Founder's Executive Diamond, Double Diamond, Founder's Double Diamond, Triple Diamond, Founder's Triple Diamond, Crown Diamond, Founder's Crown, Crown Amabssador, Founder's Crown Amabassador. In all there are 22 intermediaries who line thier pockets with the price paid by the end-consumer.
More in the coming episode.
1 comment:
Wow, you are again proving how little you know about the Amway business.
First of all, what gives YOU the absolute right to define what "direct selling" is? Direct Selling federations around the world, and direct selling companies around the world, define it as sales outside a fixed retail location. The question of arrogance lies at your doorstep, not only in deciding that a 100yr old industry is wrong in defining what it is, but in also "taking it for granted" that Amway lied to the High Court! What extreme hubris you display!
Now, for where you are wrong. First the "titles" you refer to at the end are not "intemediaries". They are simply recognitions of sales volumes obtained or for training others to reach those sales volumes. Volume and profit does not "pass through" these "intemediaries" as you seem to believe.
A "platinum" used to be known as a "direct distributor". Why? Because they deal directly with Amway. There are no "intemediaries" between Amway and the Platinum.
The 21% bonus scale and Ruby bonus is simply volume based discounts, no different to any other business. Do you have a problem with people who buy in large volumes getting products cheaper?
Emerald and Diamond bonuses are not commissions at all. They are profit sharing arrangements based on the companies overall profit.
Similarly,, the Founders Bonuses are incentive awards from company profit.
You state "approx 49.75%" goes towards these incentives/commissions. That is possible an underestimate, but not by a lot. If we assume you are correct, that means 20%-45% goes to the person directly responsible for the sale. What is left out of that 45% is profit based on volume discounts, for the distributors up to and including Platinum.
less than 5% goes to "toplevel" IBOs
You state "This is totally contrary and inconsistent with the philosophy of saving additional costs."?
What philisophy are you talking about here? Your philosophy? Grow your own food and cotton and make your own clothes my friend! Get rid of all those pesky middlemen!
The volume discounts (25% of the 49.75%) are in principle no different to volume discounts that exist in traditional distribution chains. Do you believe it is wrong for people who buy large quantities of products to pay a cheaper per unit price than people who buy small quantities?
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