Friday, April 13, 2012

Amway platinum's income

A common question a prospect has when looking at the Amway IBO business plan is how much does an Amway platinum really make. The brochure given to them says the income for

Q12's & above is about $55,000/yr

so the prospect thinks that is what a platinum makes and all the platinums paraded at the end of the open meeting business plan actually makes.

If you look at the 6-4-2 plan, it shows a platinum makes about $2,700/month. They also say in the plan that if you maintain that for 12 months, you get additional bonus of $20,000 and your income will be over $50,000/yr. Those numbers are correct, provided you have that exact 6-4-2 business.

But here is the truth:

It is a highly impractical example and it is 100% sure that you will not go platinum with a 6-4-2 business.

To really understand the plan, you need to do some math. The way your bonus is calculated is through differential, not your total PV. What this means is that if you have lot of width (personally registered IBO's) and the volume coming from each leg is roughly the same, like the 1300 PV shown in the 6-4-2 plan, then you will make money.

But now (especially with the philosophy/technique of tap-rooting) your upline will take all your contacts and put them in one leg for you, one below another, and build depth. Yes, it helps build stability to your business that way, but the security and the money is only for your upline initially (provided he has other legs). You are, of course, still "learning". Your upline will try to find someone who will build another leg by himself. It may be you, or someone below you. Let us say, you are really fortunate and your upline built 1 solid leg for you (which in itself is highly unlikely). Now you have 1 leg with 4000 PV and let's say, you did 150 PV yourself. Do you know how much money you will make?

Your maximum total will be around:

4150 PV * 3 BV/PV * 21% = $2,614.50

(21% is the PV bracket for 4000 PV to anything below 6000 PV)

Is that the money you make? NO. That is the money paid to your entire group.

Your downline went 4000 PV, so he and the group below him will make a total of

4000 PV * 3 PV/BV * 21% = $2,520

So your check from Amway will be for

$2,614.50 - $2,520 = $94.50.

Great income, eh?

The lesson is - you should not be in the same PV bracket as any of your downlines. If you are, then you won't make much money.

Do you know how many legs majority of the Amway platinums have?

ONE OR TWO, NOT SIX

So how much money will they make?

With two legs, the maximum you can make is when both your legs do equal PV. Let us say, they both are 4,000 PV and your total is 8,000+ PV and you crossed 7500 PV that month. Now you are in 25% bracket and both your legs are in 21% bracket.

The money you will make is (assuming you do 150 PV yourself):

(8150 PV * 3 BV/PV * 25%) - (2 legs * 4000 PV * 3 BV/PV * 21%) = $1072.5

Not bad money, but 99% you won't go platinum this way. You will have one 6000 PV leg (23%) and you will scramble for some PV to go 7500, so you will end up stocking up 1500 PV worth of products and lose about $1000+. Or your downline will go 7500 PV and you won't have anything on the side and you will be a "pushed silver" i.e. someone who went 7500 (called 'silver' when you go 7500 PV first month) without doing any work.

They you will realize you need to build a 2nd leg to make money. Only when you build a strong 2nd leg you will see some money. That is a LOT of hard work, so don't believe it if they say money will come easy to you. When you have two strong legs and build a third leg, you will see some good money coming in. Of course, there are people (0.0001% of 'active' IBOs) who have built 6 & more legs, but just know the facts before you "go for it".

4 comments:

  1. It should be noted also, that a Q12 platinum is the exception and not the rule. Even at Q12, a fully dedicated platinum on the system would spend so much on tools that a minimum wage job would probably net more income.

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  2. I know these blogs are from a long time ago, and you may not even read this... but thank you. My significant other has been sucked into Amway... and I feel like I can't breathe anymore. Upline complete forces us to eat, breathe, and sleep on AMWAY and it's the only thing my SO can talk about anymore. I feel like I could scream... so seriously. I appreciate your time and dedication to your blog, and will be showing it to my SO as soon as he gets home from his AMWAY meeting :)

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  3. inally, an illustration which has brought out the reality of the rebate you get. Inspite of having an accounting degree i was lazy to do the math and the way it was presented was convincing, but later came to realise that IBO's who have gone platinum are also struggling to make ends meet but keep pursuing this in the hope that their negative finance is not for long and it is only a matter of time before they break higher pins(a less than 1% chance as i have come to find out). The indoctrination of looking at positives, as in a fairy tale gives them a false sense of security, only later to regret at their plight unless they go the full mile being at the brink of being completely broke.

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  4. Many thanks for the exciting blog posting! I really enjoyed reading it, you are a brilliant writer. I actually added your blog to my favorites and will look forward for more updates. Great Job, Keep it up

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