Tuesday, 9 February 2010

It is easy/quick money in the Amway business model: AP High Court

Trivedi innocently says that there is no compulsion to recruit people or purchase products in the Amway business model. And he also says that the High Court judgement did not say that Amway business model is illegal.
Let us look at the 28th and 29th para of the AP High Court judgement which goes like this...
28. As is evident......... Supposing the sponsor member at the top does not introduce any member and if he merely sells the products given to him, he gets an income of Rs. 12,420. If he sponsors only six people and they in turn do not sponsor any member, then he will get an additional income of Rs. 23, 760. If those six members who he sponsored again sponsor four members each, he will get a further income of Rs. 1,14,480 and if the 24 members sponsor three members each, and he will get a further sum of Rs. 6,83,300. Thus the money which the member at the top of the line gets depends upon the members whom he enrolls or the members enrolled by him enroll.
29. In Para 21 of the counter affidavit of respondent No 6, the example of Raja Naren is cited and the petitioner (Amway India) did not dispute the averment relating to the income he earned in a year. The said instance is illustrative of a person earning fabulous income without doing anything after he accomplishes his task of enrolling the required number of persons as members into the scheme.
30. From the aforementioned discussion, it is proved that the scheme provides for easy/quick money to its distributors.
Is it not sufficient inducement for any mortal to go for enrollment when such huge amount is offered as commission?

12 comments:

dtytrivedi said...

"28. As is evident......... Supposing the sponsor member at the top does not introduce any member and if he merely sells the products given to him, he gets an income of Rs. 12,420. If he sponsors only six people and they in turn do not sponsor any member, then he will get an additional income of Rs. 23, 760. If those six members who he sponsored again sponsor four members each, he will get a further income of Rs. 1,14,480 and if the 24 members sponsor three members each, and he will get a further sum of Rs. 6,83,300. Thus the money which the member at the top of the line gets depends upon the members whom he enrolls or the members enrolled by him enroll."

Now this could be moment where i can prove my point.

I am open and incase if any one don't get my point let me know.

go this link for downloading the file for reference

http://evilshare.com/25bzuejz00ck/Case_against_amway_in_India.doc.html

Here is my point.

The judgement was made strictly on the basis that a distributor is doing on 6-4-3 basis. there is no compulsion

refer to para 26 where there is word called "assumptions" that if a distributor does 100 pv in first case, then in second if, he recruits 6 other people and they are doing 100 pv as well. the point which is missed is 'assumptions' and 'if'.

Because there is no compulsion regarding purchase of amway products, purchasing specific quantity of amway products and recruitment, it would be difficult for amway to explain that how a distributor will benfit by doing business with amway.

So, They have created 6-4-3 model for the sake of understanding that how this model works if a person does business in this way.

i am not following it, my mother is not following it infact i am the only 'active downline' of her who is doing business. Rest of others are more or less are customers.

now in next post i will prove that how these calculations shown are taken in a wrong way.

dtytrivedi said...

calculations done are absolutely right but they are taken in wrong way.

for e.g.
" Supposing the sponsor member at the top does not introduce any member and if he merely sells the products given to him, he gets an income of Rs. 12,420."

refer again to page 10 and 11. In page 10 in the end, there is table drawn where in first row, refer 2n and 3rd column which states

"assumptions" and "You Sell products 100 PV"

Which it means that if do 100 pv in 12 months which means i do business of 4500, and i get 135 Rs commission, and i also get 20% retail profit (if all 100 pv i sell it at 20% profit as a part of personal sales) which makes Rs 900. total i earn in a month is Rs 1035 and Rs 12420.

Now i judgement didn't took into consideration many things which makes this flawed business plan.

1. Its and example, it did not said that one has to do 100 pv. Refer again to para 26 page 10 in ending word " assumptions"

2. taking above into account it also assumed that a distributor buys 100 pv and sells it at 20% profit.

What will happen if buy product worth 100 pv and 50% or 100%of it i used it for self consumption.

What will be the scenario if did no retail in that month?

What will be the scenario if purchased product more than 100 pv

What will be the scenario if sell more than 100?.

3. Similarly other findings like

A)If he sponsors only six people and they in turn do not sponsor any member, then he will get an additional income of Rs. 23, 760

B) If those six members who he sponsored again sponsor four members each, he will get a further income of Rs. 1,14,480. And

C)if the 24 members sponsor three members each, and he will get a further sum of Rs. 6,83,300

Are made on the basis of assumptions that if the business is carried out in 6-4-3 way and every one are doing 100 pv.

Its just an example

What if i am not doing 100 pv?

What if i am not sponsoring people?
(infact we joined amway since last 3-4 yrs for the sake of self consumption through getting 20% discount through distributorship)

A distributor who achieved level of 21% does not mean that he will get fixed income of Rs 56,925.

based upon business structure a distributor can earn as low as Rs 18,945. if he is generating business of 10300 through one downline (in example of 6-4-3 he generates business of 10300 pv through 6 downlines).

To concluded there is no fixed income of a pin holder, even diamond pin holder income varies according business structure and volume generated through it.

Tex said...

Shyam,

Do you know the difference between a compulsion and an incentive? LOL

Shyam Sundar said...

You both conveniently miss the point. Is it not sufficient inducement for any mortal to chase for more people to enroll into the scheme when such huge amount is offered? This is the crux of the point of the pyramid structure. That is why it is mathematically impossible. That is why it is illegal money circulation scheme. One is compelled by the incentives, Clueless Tex.
Anyway Trivedi, who is your ghost writer this time.

Tex said...

ibofb is right, you're a Communist. We have nothing to discuss.

dtytrivedi said...

Dear shyam

I have question for you. To your point

"Is it not sufficient inducement for any mortal to chase for more people to enroll into the scheme when such huge amount is offered? "

i tell u he can earn more without enrolling people.

if he sells product worth 10300 pv then he will get straight forwardly get Rs 98,235

refer para 26, u will also see that in enrolling people, commision gets distributed.

So If he sells product by his own then he will earn Ra 98,235 (adding Rs 900 retail profit).

But this goes totally against judgement made in AP high court. The court only thinks that a distributor cannot sell more than 100 pv.

The answer to that is simple there is no limitation and no compulsion in purchasing and selling amway products.

dtytrivedi said...

dear shyam i suggest you to come outside the 6-4-3 frame.

u think enrolling people will increase the chances of earning.

but thats partially correct.Infact its structure and volume that increase the chance of earning.

taking 6-4-3 example for making u understand what i am saying.

In that example as u know that total 102 people are enrolled in that and they are doing 100 pv per month.

now, if a person enrols 102 people in stage 2 (i.e. instead of 6 if a person enrols 102 persons) and if all are doing 100 pv then. he will be earning a lot more.

here is the calculation.
This is done on the basis of 1pv = Rs 45

total volume generated including the first person will be

103*100pv, which mean 10300pv.

now 10300 pv *45 = Rs463,500 (1 pv = 45 BV or Rs)

total commision generated will be

(Rs463,500 *)= 97,335

And total commision given to others will be Rs135*102 = Rs 13,770.

(As 102 people joined in first stage doing 100 pv.) so all are qualified 3%, so Rs 4500 * 3% which makes Rs 135 and it will be given to 102 people who joined.)

and total commison earned by the first person will be Rs 83,565
(97,335-13,770).

so here is my conclusion:

Income of a person in amway sales and marketing depends upon
1. Width (how many person are enrolled in first stage). the more income, the more will be width of the income.

2. depth (how many people are enrolled in people who are enrolled in first stage).Depth will ensure the consistency of the income.

go to:
http://evilshare.com/25bzuejz00ck/Case_against_amway_in_India.doc.html

refer 10th and 11th page where u will see diagram and on the basis of that u will understand how i made changes structure and calculation.


3. Volume: If no volume is generated through self consumption or retailing or both then no income will be generated no matter how many people are enrolled.


And according to latest information which i have is that now a person has to give only Rs 995 for becoming a distributor.

And main important thing is that IF A DISTRIBUTOR RECRUITS A PERSON IN THE BUSINESS, THAT INVESTMENT MONEY OF Rs 995 DOES NOT COUNT IN THE BUSINESS VOLUME OF THAT PERSON.

So Personal Business volume will be only counted through purchase of products for self-consumption or through retailing or both.

公車 said...

與其爭取不可能得到的東西,不如善自珍惜運用自己所擁有的........................................

Tex said...

You can say that again!

Shyam Sundar said...

Tex accused me of being a communist and declared that there is nothing to discuss. Still he hangs around and supports a commentor who published in a language which I could not answer.
Why hang around Clueless Tex? LoL

Tex said...

Because it's fun to expose how STUPID you are!!! LOL

Legal Scan said...

Clueless Tex indulges in hurling abuses if he has nothing to say anything substantial. It seems he lost his case.