[Direct sellers operate at a loss, and the Amway model is questioned] The Amway model

The Amway model is again questioned. Recently, many direct sellers who have worked as Amway have reported to the Investor News reporter that they have lost a lot of money because of Amway in recent years, ranging from tens of thousands to hundreds of thousands. Some family members of Amway direct sellers even reported that their families were in crisis because of Amway direct sales.

Regarding the above-mentioned facts reported by Amway direct sellers, a reporter from "Investors News" has called the number of Amway China's public relations staff and the number of Amway China headquarters many times in recent days, but none of them got through.

Public information shows that Amway is one of the world's leading direct selling companies founded in the United States in 1959. In 1995, Amway (China) Company was officially established. According to data disclosed on the official website of Amway China, in 2010 Amway China's market sales are nearly 22 billion yuan, making it the world's largest market.

Losing money to do Amway

At the beginning of this year, Lin Shuhui, an individual business owner in Fujian, started to be dragged into doing Amway business, and it has been out of control ever since. Lin Shuhui invested more than 100,000 yuan to purchase products and develop them offline, and often went to Fujian, Xiamen, Guangzhou, Fuzhou and other places to attend lectures.

"After doing Amway, she no longer has the heart to run a beauty shop. She drinks tea and chats with her upline all day long, focusing all her attention on Amway, and the beauty shop doesn't care about it." On August 8, Lin's lover Niu Gang told the Investor News: "The whole village knows that her whole person has changed. Her parents and relatives are against her doing Amway, but she just can't listen."

Niu Gang and Lin Shuhui quarreled several times because of Amway. In a fit of anger, Lin Shuhui took the Amway products and ran away from home. Today, Niu Gang has a four-year-old son at his knees. During the period when Lin Shuhui left, she had no contact with the child.

“She used to open a beauty shop by herself and earn seven to eight thousand yuan a month. Since she started making Amway products, she has lost sight of the money and asked me to spend hundreds of thousands of yuan. She spent all her hard-earned money on Amway," Niu Gang said helplessly: "Today is the 41st day, and there is still no news from Mr. Chen in Shanghai. Experienced a similar experience. Mr. Chen was originally engaged in the hotel industry. In early 2008, he was encouraged by a netizen to start a business and started Amway direct sales. However, he did not expect that not only was he delayed for three years, but he also lost more than 500,000 yuan.

Mr. Chen uses the salary he earns from work to constantly buy and stock up goods to boost performance, hoping to get more bonuses. The result is that a lot of money is invested, but the income is not much.

After persisting for 3 years and 9 months, Mr. Chen finally made up his mind to quit. "I found that this is a serial scam with a very clever disguise. It allows you to always see hope, but you will never get it. It is attractive to see it, and new people keep joining." Mr. Chen said.

Xiao Fei, a well-known anti-Amway person on the Internet, revealed to the Investor News that doing Amway has caused heavy losses, including a large number of direct sellers who have lost their jobs and broken up their families. Xiaofei worked at Amway for 7 years and reached the diamond level, which is considered mid- to senior-level in Amway, but he still didn't make much money.

The model is questioned again

Fan Weiyun, a senior industry insider with many years of experience in the Amway industry, believes that there are three main reasons why Amway direct sellers do not make money: First, China’s laws and regulations make The operating costs of Amway China have increased; the second reason is the performance inventory; the third reason is the backwardness of Amway's reward mechanism.

In 2005, China’s Direct Selling Law was promulgated, which stipulated that direct selling companies must open physical stores. This has invisibly increased Amway's operating costs in China, and public relations and advertising expenses have remained high. "Especially stores and advertising should have given away profits to direct sales personnel, but now they don't, so the bonus allocation rate for Amway employees is low." Fan Weiyun said. According to the official website of Amway China, as of July this year, Amway has 282 stores in 31 provinces in China.

In fact, Amway abroad is different from domestic Amway.

"Amway is living well in the United States and Canada, but their direct sellers are definitely not as rampant as in China, and they will not sell dreams as commodities. More importantly, Amway in the United States requires products that cannot be sold offline to be put online Unconditional recycling means returning goods without any reason, thus eliminating some evil practices of hoarding goods. In the United States, if you don’t want to attend an Amway rally, if you call the police for the second time, you can accuse the other party of harassment,” said one person who did not want to disclose. The named industry insider said that he had participated in the research and investigation work before the introduction of China’s direct selling law.

In short, Amway needs to comply with two regulations abroad: One is the customer return mechanism: consumers (including direct sellers, of course) purchase any Amway product within 90 days. , can be returned without any reason. Any direct seller who joins can choose to withdraw within one year.

In fact, Amway implemented the above two policies in China before 1998, but it encountered malicious returns. Subsequently, Amway changed the return period to 30 days. At least half of the products must be opened, and half of the products must be refunded. Nutritional products cannot be returned.

“In fact, these two exit mechanisms are also stipulated in the Business Ethics Agreement of the World Direct Selling Association, and many countries strictly abide by these two provisions. If these two provisions were in place, the domestic direct selling industry would not be so chaotic. . It is precisely because of the lack of this protection mechanism that dealers and direct sellers will impulsively stock up or place large orders after being encouraged. "Fan Weiyun also called for these two items to be included in the direct selling law.

Another thing that cannot be ignored is the change of CEO of Amway China. In early 2011, the president of Amway Greater China who took over from Zheng Lijinfen was Yan Zhirong. "After Yan Zhirong came to power, he paid special attention to performance. Amway's performance may be greatly improved in the early stage, but he does not pay attention to the interests of direct sellers." An industry insider who did not want to be named told the Investor News reporter.

“If we only focus on performance without paying attention to the actual living conditions of direct sellers, and do not solve and deal with the complaints of existing marketers, then this kind of resentment and contradiction will become bigger and bigger, and even In the end, it will hinder Amway's development and even cause a sharp decline in performance," the above-mentioned person said with concern.