Amway MLM Review – Is It a Scam or Legit Multi-Level Marketing Company?

Is Amway a Scam or Legit?

Amway is a legitimate MLM company, founded in Ada, Michigan by Jay Van Andel and Richard DeVos in 1959.

It promotes various products, including cleaning, to customers in numerous countries worldwide. Notably, Amway reported sales of over $8 Billion in 2020.

In 1979, the Federal Trade Commission (FTC) stated that Amway is not a scam due to its sale of physical items and compensation based on recruitment. United States legislation typically prohibits pyramid schemes that lack product distribution.

However, this does not guarantee complete legitimacy.

In 2010, a class-action lawsuit resulted in a $150 million settlement against Quixtar, the new name for Amway. The plaintiffs claimed that Amway primarily profits from selling motivation and training products rather than tangible goods.

Moreover, the company was found to be non-compliant with the 1979 FTC ruling, facing allegations of wire and mail fraud, as well as racketeering.

While Amway requires recruitment for substantial earnings, it has managed to operate within the confines of the law, at least in the United States.

To sum up, considering the available information, it is clear that Amway is a legitimate MLM company that individuals worldwide can join to represent and earn an income.

Keep reading my Amway MLM review to gain more insights into the company, its products, compensation plan, pros and cons and more!

What is Amway?

Amway is a well-established company that offers a wide range of products, including cosmetics, supplements, water purifiers, and more. Perhaps you have even purchased some of their products.

Amway has faced a lot of criticism recently, making it difficult for those considering joining. Interestingly, a significant portion of this criticism comes from individuals involved in the business or similar ventures.

Amway is one of the most disputed MLMs, often labelled as a pyramid scheme and even a scam. The truth behind these claims is open to interpretation and debate, which I will delve into further in my Amway review.

The brand’s reputation has largely suffered due to its past run-ins with the FTC. However, it’s important to note that most major MLM companies face some degree of scrutiny from the FTC due to their inherent nature.

To discover more about this business opportunity, watch the video below…

Amway, founded in 1959 by Rich Devos and Jay Van Andel, has been a successful business for over 50 years.

With branches in over 100 countries, it is the highest-grossing network marketing company globally.

Operating under the principles of freedom, family, hope, and reward, Amway promotes a positive message for living life.

However, if you’re wondering how the company works and whether it’s a scam or a pyramid scheme, I encourage you to read my Amway review for more insights.

Related: Is Cutco a Scam or Legit?

Who Founded Amway?

Amway was founded in 1959 by Jay Van Andel and co-founder Richard DeVos. Van Andel and DeVos connected while attending the Grand Rapids Christian Institution, where they discovered a shared passion for business and sales.

Before Amway’s establishment, Jay Van Andel and Richard DeVos had been business partners in various ventures, most of which failed.

One such endeavour was Nutrilite, which differed from other businesses at the time by offering both sales commissions and incentives for recruiting suppliers.

Initially focused on nutritional supplements, Nutrilite later expanded its product line to include cleansing products like Fluid Organic Cleanser.

After several unsuccessful attempts, Van Andel and DeVos finally discovered a successful business model and decided to start their own multi-level marketing company, which they named Amway, short for American Way.

The company quickly gained global popularity but faced a tarnished reputation in the United States, as it became associated with pyramid schemes.

To combat this negative perception, the company was rebranded as Alticor in 1999, and the sales divisions were changed to Quixtar Brand.

Today, Amway is known as the leading multi-level marketing company worldwide, seemingly offering a feasible path to wealth.

If you’re interested in learning more about Amway, including how it operates, how you can earn money with it, and whether it is a scam, pyramid scheme, or legitimate MLM, continue reading my Amway review.

Is Amway a Pyramid Scheme?

As mentioned earlier in my review, Amway is not a pyramid scheme. It is important to note that they have faced challenges in this aspect. However, from an objective standpoint, it is a legitimate business operation.

Amway is a direct marketing firm that utilizes the network marketing (multi-level marketing) business model. It markets its products to consumers through its extensive network of Amway Distributors and Independent Entrepreneurs.

In other words, Amway leverages the network marketing approach to reach and engage with customers.

What Is Pyramid Scheme?

A pyramid scheme is a fraudulent system for making money by recruiting an ever-increasing number of “investors”. The scheme works with the initial promoters recruiting investors, who then recruit more investors, and so on.

To learn more about pyramid schemes and whether Amway falls into this category, please watch the video below.

Amway offers a range of products, and employees have the opportunity to earn money by marketing these items. However, it is important to note that this does not make it a pyramid system.

If the sole means of generating income was through recruiting new members, then it would indeed qualify as a pyramid scheme.

Is Amway a Pyramid Scheme in Disguise?

Amway is not categorized as a pyramid scheme because it has been determined by certain individuals in politics that it doesn’t meet the criteria. Technically, Amway operates as a multi-level marketing (MLM) company.

They offer commissions based on your sales and the sales of those you recruit.

Basically, Amway sells real products that people can use, and bonuses are earned from team sales. Unlike pyramid schemes, there are no direct payments for recruiting others, so there is no shady activity.

In short, Amway is not a pyramid scheme.

In a pyramid scheme, you are required to recruit others to earn income from the company. However, in a multi-level marketing company like Amway, you can make money by selling physical products or recruiting new prospects.

It’s worth noting that Amway does not directly pay individuals for recruiting others.

However, experienced individuals in the MLM industry, especially those familiar with Amway, understand that the best way to earn significant income is by recruiting new distributors.

How Does Amway Work?

To join the market Amway, you are required to spend your cash. In addition to paying fees to be part of the “direct marketing association,” you will also be asked to purchase the products.

Not only should you be seen using their more expensive items, rather than their Target alternatives, but it’s also important to keep stock on hand to offer interested customers.

Distributors earn a small commission on all the items they sell, but there’s a limit to how much soap can be sold in a day. The real money comes from individuals who pay hundreds to become “independent business owners”, as Amway calls it.

As new members sign up under you and recruit more representatives, the money flows upwards.

The key to earning a substantial income is to have people working for you, and then have people working under them, and so on – this is why it’s called a multi-level marketing (MLM) or pyramid model.

While Amway is not technically an illegal pyramid scheme, it certainly follows a distinctive pyramid shape, which is remarkably similar to traditional pyramid schemes.

They refer to it as direct selling instead of MLM, and you can find more information in the video below…

Are Amway Products Any Good?

Amway is known for a wide range of products, including nutritional supplements, cleaners like “L.O.C.” (legacy of tidy), and their Creativity line with cosmetic and personal care items.

One standout product is the Espring, a tap water purifier that has received excellent reviews and an “outstanding” rating from customer reports.

It uses a combination of UV light and carbon block filter for effective purification. Another popular product is the XS power drink, which sells over $100 million annually through independent business owners.

With over 450 products, Amway offers a diverse selection and maintains high-quality standards.

Why Are Amway Products Expensive?

Amway claims that its products are priced higher due to their transcendent nature. They assert that these items are exceptionally focused and developed to be more effective and safer than other products, thus providing greater value for your money.

Amway products, despite the company’s claims, have not performed well in consumer testing.

In fact, extensive testing by Consumer Information has shown that their recipe detergents and other cleaners do not work as effectively as traditional brands.

Furthermore, these products are often inferior to those available at much lower prices in local big box stores.

So, why are Amway products so expensive? The answer lies in the company’s desire to maximize profits.

In contrast to the significant overhead and employee costs incurred by most stores, the amount paid to Amway representatives is meagre. To compensate for this, the company must rely on high prices.

This means that most of its employees pay the company for the privilege of marketing its products.

How Much Does Amway MLM Cost to Start?

Luckily, Amway is not one of those MLMs that will eventually drain your wallet in case you decide to start. You can start at less than $100.

Here is the official word:

Our refundable registration fee is less than $100 annually and covers the cost of resources Amway provides to help our Independent Business Owners (IBOs) effectively run their businesses.

These easy, efficient resources put our IBOs on the path to success by teaching them how to set up their virtual offices and providing them with ongoing education, training, product marketing materials, customer service, mobile business management tools and more.

Source: Amway FAQ page

Can You Get a Refund?

As noted above, you can get a full refund. Here is the official policy:

Investing in an Amway business is low-cost and no-risk. You can get started for less than $100 and, if you decide Amway isn’t for you, we will happily refund your money within 90 days of your registration.

Source: Amway FAQ page

How to Make Money With Amway MLM?

There are two methods to make money as an Amway MLM promoter:

• Earning a payment from marketing items.
• Employing people and making an income from their sales.

It is essential to keep in mind that you do not get paid directly for recruiting individuals. Instead, you receive bonuses for the items they buy or market.

Therefore, to earn anywhere close to a full-time income, you will have to actively start recruiting people.

Amway Compensation Plan

Understanding the Amway compensation plan is not as complicated as it may seem. Essentially, the company takes a different approach than traditional corporations by bypassing traditional advertising and retail.

Instead, they pass on the savings to their customers or IBOs (independent business owners).

This means that Amway products are not sold in stores like most conventional corporations. Instead, they use a concept called “buzz marketing” to effectively spread the word and distribute their products.

Watch the video below to see how the Amway compensation plan works.

Can You Make Money With Amway MLM?

When a firm is generating $8 billion a year, it’s reasonable to assume that its top suppliers are making substantial profits as well.

If you happen to meet someone at the “Founders Emerald” or “Founders Diamond” levels in Amway, they are likely earning the majority of the income.

Similarly, individuals at any of the “Crown” levels are making a significant amount of monthly residual income.

However, it’s important to note that such cases are not the norm.

Fact: Only a small portion of Amway distributors make significant income.

So, what kind of income can you expect as an Amway business owner? According to Amway.com, only 48% of their independent suppliers are both profitable and active. Of those who are active, most make only $200 a month!

Why do most Amway business owners earn so little? Well, the truth is that direct selling is an uphill battle, especially in the beginning. It’s difficult to get the ball rolling.

Furthermore, one of the main reasons people struggle with Amway is due to a lack of time commitment. Many treat it as a part-time job.

Unfortunately, this part-time job requires a significant investment of both money and time to generate a decent income.

Can You Sell Amway on Amazon?

Although Amway prohibits the sale of their items on online platforms like Amazon, it is not illegal. Amazon has no restrictions on selling any legal item.

However, despite Amway’s guidelines, some distributors still market their products on platforms like Amazon or eBay.com. They hope that the company won’t notice their actions, allowing them to reach a larger target audience and increase sales.

Selling online can be an attractive option to increase your chances of success, especially since there is limited profit to be made when selling soap containers for $40 face-to-face.

How Does Amway Make Money?

The business does not make significant profits from selling cleansing supplies and eye shadows, like its representatives. Instead, it generates income from two main sources:

• Fees from items marketed when people join as independent entrepreneurs.
• Organization materials such as tapes, meetings, and other educational experiences.

Many top Amway partners earn money by selling the dream of wealth rather than focusing on product sales. While they may appear wealthy, most of their wealth does not come directly from the Amway marketing association.

They market books and other materials promising to inspire and teach others how to achieve great wealth, just like them. However, many customers do not actually experience financial freedom through Amway Global.

Therefore, many people have labelled Amway as a scam – more about this will be discussed in my review.

In reality, individuals are led to believe that they will become Amway entrepreneurs, when in fact they become Amway consumers.

This means that the majority of independent business owners end up spending their money on Amway training materials, such as seminars, and on the dream of wealth and unlimited income potential. They later realize that it was all a hoax.

Do Some Countries Ban Amway?

Amway is not prohibited in the US. However, it is outlawed in the UK due to the revelation that Amway generates more revenue through marketing to their distributors rather than direct marketing of their products.

Additionally, Amway is currently under extensive scrutiny by law enforcement agencies in India, with certain high-ranking representatives being apprehended for involvement in a prohibited pyramid scheme.

In the US, Amway is currently facing numerous legal challenges to continue its operations. It is highly likely that, similar to India and the UK, Amway’s days of service are limited.

So, what exactly is the deal? Is Amway a scam? Find out in the next section of my review…

Related: Crowd1 Review

What Are Amway Reviews and Complaints?

When it comes to determining whether Amway is a scam or legitimate, reading online testimonials can provide valuable insights.

Fortunately, the majority of websites that feature collective reviews on Amway portray it as a reputable company. These reviews typically average between 3.5 and 4.5 stars, which is quite impressive for this industry.

For example, on TrustPilot, there are 20 reviews of Amway, with a solid rating of 4.1 stars.

In comparison, many similar MLMs receive ratings between 0.5 and 2.5 stars. Similarly, on SiteJabber.com, Amway maintains a respectable 3.0 rating based on 23 reviews.

Below, you will find a selection of the most common positive and negative Amway reviews…

Most Common Positive Reviews

There are mainly positive reviews regarding Amway’s product quality and customer service. However, I couldn’t find many positive reviews from MLM participants.

Most Common Negative Reviews

However, the majority of negative reviews of Amway are aimed at their business model. In fact, some individuals go as far as claiming that Amway is a scam or a pyramid scheme…

Most Popular YouTube Reviews

Despite the mix of good and bad reviews, there are several YouTube videos in which former distributors provide first-hand experiences, shedding light on the truth about this MLM company.

Amway MLM Review – Conclusions

Amway, despite some encounters with the law, is considered a reputable business.

They are known for providing high-quality products and treating both consumers and representatives with integrity. One unique feature is the opportunity to return the starter kit if dissatisfied with the company.

These aspects demonstrate Amway’s commitment to ensuring a positive experience. While I can’t advise your decision, I hope this review helps you make an informed choice about joining Amway.

So, what are your thoughts on Amway? Would you make a purchase? Is it a scam? Please share your comments below!

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