Amway Scam Warning Opinion (Updated)
Disclaimer: These comments that you are about to read are my personal opinion and you should rely on your own research when deciding whether to pursue the Amway business opportunity. Any facts below are provided for reference only and any errors will be corrected.

The Amway business opportunity has proven after 50 years that year after year it produces billions for the company and little for the active Independent Business Owners that are doing the actual work. There has not been a financial revolution for Amway IBOs in the United States and now most of the income for Amway comes from outside the United States.

Amway Scam Background

One of the first MLM companies was Nutrilite which became a corporation in 1939.

They sold nutritional products which were promoted as effective in treating a variety of ailments, including cancer, heart disease, and depression.

The founders of Amway started in Nutrilite in 1949 as distributors (Jay Van Andel and Rich DeVos).

In 1959 Amway was founded.

At Nutrilite they learned the secret to the MLM scam. Make your distributors your customers, but make them think they are entrepreneurs.

Amway bought a controlling interest in Nutrilite in 1972 and took over complete ownership in 1994.

Amway Scam Story

Since 1959 Amway has been selling the dream of financial freedom.  Few of the people that have joined Amway have found that dream. Amway is based in the U.S., but they do about 90% of their business outside of the U.S.. People in the U.S. are very familiar with the selling tactics that have been used by Amway IBOs.  If you mention the Amway name to people, most will head to the door.  This has lead to many IBOs creating their own companies that have different names, but they still sell the Amway dream. Even Amway gave it a shot when they branded themselves Quixtar North America.

Today The average U.S. Amway IBO makes about $207 per month before expenses, according to the company. After expenses you are looking at the average person losing money. Amway has accepted a $56 million class-action settlement with former U.S. reps who say the company used deceptive practices and misled them about profits. Amway didn’t admit wrongdoing, but plan on focusing less on recruiting new salespeople and more on actually selling products.

Here is a current example of the Amway scam in action:

The meeting began, and the Amway Diamond Mike Carrol was our speaker. This guy was dressed well, came from a military background, had a nice wife, and had a HUGE following of people excited to be in his presence. I was getting really pumped up, and wanted to listen to everything he had to say…then he started to talk.

He talked for about an hour and a half about his life story, and how wonderful this business was for him. His talk was riddled with poor speech technique and very bad jokes. I became confused. I wanted to learn about how I could better myself, not hear about how he has a bunch of money, had his kids privately tutored, went on extravagant trips, and paid for everything in cash (important to mention that). Finally, he began to write on his white board, and explain how we were going to make money. His explanation was awful as he talked about buying from our store (Amway) instead of a grocery store, and then creating a team (drew circles on the board) that we would teach to repeat the process. He said, “It’s all about duplication!” I didn’t get it, and was extremely dissuaded after listening to him talk. In the last part of his speech he brought out a credit card (remember when I said the other part was important), he said, “Every time you guys use your Amway credit card and make a schwipee (because we were 3 years old and couldn’t pronounce swipe), I get paid.” This was a real WTF moment for me…he said he paid for everything in cash, and yet he has a credit card, and is suggesting everyone else get a credit card. Something wasn’t right.

After the meeting my friend asked me what I thought, and noticed I was not impressed. I tried to be polite and say “I don’t get it.”, but he jumped down on me and said, “That’s just the way Mike talks. You will get it when we go to the next meeting.”

At this point I probably should’ve cut my losses, but as a nice guy I obliged him with more time on this subject (I really did like the guy). – Source John Doe And The Amway Scam

It is still all about duplication for Amway.

Top Amway performers make most of their income from books, tapes, and appearances. – Source NBC Dateline report

In my opinion, it is time for people to wake up and stop supporting this money making scam. After decades, it has not brought a financial revolution to the people in the U.S..  Why should it produce any different results overseas?

Amway Scam Facts

There are 3 Million Amway IBOs – Source

48% of Amway IBOs Are Active. I hope you understand how bad a business opportunity Amway is when only 48% of the 3 million people that were sold this business opportunity are even willing to try and make sales.

For the 48% of IBOs that do remain active, they can expect on average to make $2,484 per year before expenses – Source Amway Business Reference Guide

The Failure Rate for Amway IBOs is 99%. – Source Study of Ten Major MLM’s and Amway/Quixtar

This is an incredible failure rate when you compare it to individuals starting their own businesses.

Only 36% of businesses fail after two years on average.

According to the U.S. Bureau of Labor Statistics the survival rate for a normal business is 54-61% after 4 years.

If you choose the lowest paying job in the U.S., you can expect to make a yearly income for part time work of $7,540.
(Amount reached by multiplying the federal minimum wage of $7.25 by 20 hours for 52 weeks)

Here is an example of how the Amway scam is presented to people:

Typical expenses for being an Amway IBO are over $300 per month. This is far more than the average monthly income of $207. – Source Facts About Amway

Top Amway performers make most of their income from books, tapes, and appearances. – Source NBC Dateline report

It’s important to get a complete picture of how the plan works: not just how much money distributors make, but also how much time and money they spend on the plan, how long it takes before they’re earning money, and how big a downline is needed to make money. One sign of a pyramid scheme is if distributors sell more product to other distributors than to the public — or if they make more money from recruiting than they do from selling. -Source Federal Trade Commission on Multi-Level Marketing

Other resources about the Amway scam:

The MLM Syndrome

Married to an Ambot

Amway – The Dream Or The Scheme?

Stop The Amway Tool Scam

Here is my original opinion about Amway: