Tuesday, September 23, 2008

Amway Partner Stores Revealed: More Deception From The Bait and Switch Masters


One selling point Amway recruiters for the Business Cult use to help convince skeptical prospects to join "The Business Cult" is the Partner Store spiel. You will be lead to believe that by joining Amway Global as a distributor you will enjoy fringe benefits much like a person joining a buying club might. I will not go into a long description to debunk the really bad deal many buying clubs present, but much of the downsides to these Amway partner stores reveal the not so great of a deal these partner stores really represent.

Perceptive has provided the following information and the following narrative on how these Amway partner stores are from a very informative comment left on this blog in answer to my question to him about how these partner stores work. Perceptive felt that this would be a good subject of a post and I agree.

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Amway Partner Stores Revealed ... by perceptive
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QIAC : “ Are you trying to represent that Amway product prices for goods bought from secondary retailers are competitively priced? These partner stores have a Amway price on these goods do they not?”

Perceptive: This is a confusion that a fair number of NON-Amway people have.

Here's the real story:

These 'Partner Stores' have the SAME PRICE for Ambots, as well as regular NON-Ambot folk who go directly to their store/website.

So, Circuit City--which is a 'Partner Store--has the same prices on its website for both groups.

Except.

The Ambots log into the Circuity City website THROUGH THEIR QUIX/AMWAY website. So, the Ambots/Quixbots get a small - VERY VERY SMALL - percentage rebate from Amway. The 'rebate' is NOT comparable to what you would get from buying Amway MANUFACTURED products - average of 25%.

Here's why. Circuit City already has a pretty low profit-margin DICTATED by competition with OTHER retailers. They can't give away a whole bunch of their profit margin back to Amway. BUT. They do know that Ambots/Quixbots, being Ambots/Quixbots will RELIGIOUSLY Buy From Their Own Business irrespective of the cost, so they have got a CAPTIVE MARKET in IBOs. That justifies giving a small percentage back to Amway to get a base of customers - RETARDS who won't do ANY price-comparisons and blindly buy from that site.

It basically becomes a "marginal-cost" question for Circuit City - if your marginal-cost for gaining an additional sale - the small percentage paid back to Amway - is virtually ZERO - it makes sense to pay that marginal-cost to get that sale.

Let's assume CCity has a Net Profit Margin of 8% on it sales. Even if it gives away 1% of that back to Amway, it is getting a WHOLE NEW BLINDLY LOYAL CUSTOMER BASE for virtually free. All they had to do was to reduce their profit margin from 8% to 7%! No additional advertising or any other marketing costs needed!

Think about it -

WITHOUT this arrangement with Amway, these Ambots/Quixbots would NOT be inclined to purchase Circuit City's products - UNLESS - Circuit City offered better value compared to other retailers. Once Amway is on board, however, PRICE IS NO LONGER AN ISSUE FOR AMBOTS/QUIXBOTS!

The Ambot's argument is this - "Look, if you - a, Non-ambot - bought anything from Circuit City it would cost you X Dollars. But me - an Ambot - also pays X Dollars for the same item, but I also get a rebate check back for Y Dollars, so my actual total cost is only X-Y Dollars. Less than your non-Ambot cost of X Dollars."

EXCEPT.

What the Ambot doesn't realize is that the NON-Ambot does NOT restrict his choice of retailer to Circuit City. So He/she is free to check out Best-Buy, Amazon.com, Wal-Mart, Sam's Club and a whole host of other retailers to possibly get a better price for the same item - even AFTER factoring in the Amway Rebate, i.e. Less than X-Y Dollars.

Case in point. Porkchopjim, in trying to make the same point I am making here, made a bet with Tex that he could find the same product cheaper elsewhere, EVEN AFTER TEX FACTORED IN HIS AMWAY REBATE. PCJ looked up a Camera on the Internet and within 30 seconds found a retailer selling it for less - rebate be damned.

Just like in your wife's daughter's case.

You searched on the Internet and found other retailers selling the same laptops for half the price. Did she get a 50% rebate from Amway on that laptop? I'll bet a THOUSAND DOLLARS, no.

And here's one VERY IMPORTANT POINT that retarded Ambots/Quixbots don't pay attention to.

IF – Circuit City's Net Profit Margin is 8% and it gives back 1% rebate to Amway for purchases made by Ambots/Quixbots....

then that 1% rebate paid back by Circuit City to the Amway Corporation, is split up among MULTIPLE AMBOTS upline all the way up to Platinum.

If you are a newbie IBO at the 3% bracket, and you bought a camera form Circuit City, the REBATE you get on your purchase is actually 3% of the 1% of the purchase price. What does that come out to?

A WHOPPING 0.03%!

FRIGGIN 3/100ths of 1%.


What do the COLLECTIVE UPLINE of that hapless newbie IBO get on this purchase? 25% less 3% - of the 1%. i.e. 22% of 1%.

0.22% - About a quarter of 1%.

And depending on the number of people in between that IBO and his upline platinum, that amount is really spread thin between a bunch of people.

What are the odds that a newbie Ambot could actually find a price for the same item at another retailer that is LESS than their Ambot Price, EVEN AFTER FACTORING in the MINISCULE rebate?

Here's the best part.

The THIEVES who own the Amway Corporation, the Devos's and the VanAndels' know this but, it is a good recruitment tool to keep Ambots in, so they use it unashamedly.

....Perceptive - the Quixtar-Amway-Infiltrator
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QIAC: Thank you perceptive for your much appreciated contribution. After some reflection on these partner stores, I believe they possibly do provide the Amway distributor with a very, very small savings over the same product purchased directly through the same partner store, but in my opinion, the initial outlay to sign up to be an Amway distributor (which has to be renewed on a yearly basis) more than offsets any potential savings. This is the same type of situation that makes most buying clubs an equally a bad deal. The up front cost to enjoy savings that may sound promising at first many times are just not there.

I actually fell prey to a buying club proposition some years ago. Actually after my wife and I signed up (in conjunction with a credit card that I had at the time) we were charged in the neighborhood of around $50 to be a member for a year. At that time I had been buying a lot of electronics. To my dismay, nearly every product that I was in the market for I found at substantial savings over the buying club price elsewhere. I just don't know about other people, but I am a firm believer in saving money where I can. There is nothing wrong with frugality. At the end of the year that I was in the club, I never purchased even one item from the them. Again, I have to question my reasoning for even allowing myself to be sweet talked into joining.
Like in any recruitment offer, the promise is made to sound so much better than what the actual circumstance of the deal is. Perceptive points out the reality of the small return one actually receives, and couple this with the limitation of choice and freedom to find a better value elsewhere?

It is not hard to understand how much bang Amway and the recruiter get from the rather deceptive selling point these partner stores in reality are! I might add that many buying clubs have come under increased legal scrutiny in recent years and some have had to shut down and reimburse participants in court ordered settlements. Amway ties their quasi-buying club partner stores to the distributor's “Independent Business Owner” status which makes many a person not fully realize how these partner stores really work or even realize that they are not the wonderful deal they in turn misrepresent them to be to others. Once a person believes Amway's dribble about 100 percent product loyalty, they are set up in typical "mark" fashion to be taken advantage of by Amway which baits them with dreams of riches and switches them to what most people in Amway experience, failure, which the distributor has already been conditioned to blame on himself. Thanks to perceptive: Now I know and NOW YOU KNOW.

UPDATE: Tex made some objections to the assumptions Perceptive is using in this post, which sparked another debate over at QuixtarCultIntervention. Perceptive addressed Tex's comments in detail on there, and has promised to update this post along the same lines. Please check back for the update.

NOTE: Persons wanting to comment might want click over to Quixtar Cult Intervention, sister Mother Ship of Amway Global Cult Intervention.

1 comment:

quixtarisacult said...

Thought I'd take a moment to thank you perceptive for taking the clothes off of these partner stores so folks can see all the warts.

I know that the partner store deal sometimes is the deal closer for many of these people showing the plan. If you save one person from the cult, then the small amount of time posting will be completely worth it. Go Dude.