| MARCH 2010/MAY/JUNE 2013
AMWAY: MULTI-LEVEL MARKETING
THIS MINISTRY HAS RECEIVED SEVERAL ENQUIRIES ABOUT MULTI-LEVEL MARKETING OR MLM OVER THE PAST SIX YEARS. HERE ARE A FEW THAT I WAS ABLE TO TRACE FROM MY ARCHIVES:
From: conrad saldanha To: email@example.com Sent: Friday, June 25, 2004 12:48 AM Subject: Re: PATIENCE
I forgot to mention that at the retreat which I conducted we had a case of someone whom the Lord helped discern against CONYBIO! Praise the Lord!!! The Lord also seems to have shown him the evil of MLM = Multi-Level Marketing and the deception that is normally associated with it. [Fr.] Conrad, MUMBAI
From: joseph To: firstname.lastname@example.org Sent: Thursday, August 19, 2004 1:30 PM Subject: need an answer
I am a Roman Catholic Some time back when I attended a Charismatic Convention in Mumbai, one of the speakers referred to AMWAY as a new-age fad and that as Christians we should not promote them. My wife is very keen that we join AMWAY as a distributor as she is convinced that it is remunerative and will help us tide over financial difficulties we encounter often. Could you give me the correct position and justification for not joining up AMWAY?
God Bless, Joseph D’Souza, MUMBAI
From: Info Desk: Holy Spirit Interactive To: joseph Sent: Thursday, August 19, 2004 4:06 PM
Subject: Re: need an answer
Dear Joseph, I have forwarded your mail to Mr. Prabhu, who is very knowledgeable about the New Age Movement. He is most qualified to answer your question. He is travelling at the moment, so you might have to wait a few days for his reply. I truly appreciate your desire to do the right thing by God. May he bless you for it. God bless. Aneel Aranha, DUBAI
From: prabhu To: joseph Cc: Holy Spirit Interactive Sent: Friday, August 20, 2004 2:05 PM
Subject: AMWAY / MULTI-LEVEL MARKETING
Dear Joseph, Praise the Lord. Nice to meet you.
About AMWAY, I generally know something. But nothing that I can latch on to that I can say is bad for Christians. However, I have a unique ministry and I feel that the Lord is speaking to me through this letter of yours forwarded by Aneel. You are not the first person to set off warning bells about multi-level marketing by writing to me [or to me thru Aneel]. A priest too has recently alerted me. But I need to get some printed information to read, and I need to talk to some people. I hope to be able to do that when I go to Bombay next week. If there is anything that you can enlighten me with, it will be welcome.
Could you please tell me EXACTLY WHICH CONVENTION you talk about, the MONTH & YEAR, the LOCATION, the SPEAKER? Your disclosure is sensational! I am sure that the speaker must have done his homework right. Is he Indian? This may be the breakthrough that I am looking for.
Also if you live in Mumbai, could you please give me your address and tel. no? If you would like to have any OTHER info. on the New Age, Alternative Medicine and Eastern Meditations please let me know. Please read my write-up on CONYBIO* which Aneel put up on Holy Spirit Interactive from Dubai. Love in Jesus' Name Michael [NO RESPONSE TO THIS E-MAIL]
PS I am forwarding this by Bcc to a priest and also to a priest-in-making who may be knowledgeable about these things and/or put me onto the right people for further enquiry.
*CONYBIO: THE CONYBIO ARTICLE WAS TO BE FOUND ON HOLYSPIRITINTERACTIVE FROM JUNE 2004
New Age: A Clear and Present Danger: [http://www.holyspiritinteractive.net/features/newage/cancer02_conybio.asp] Conybio by Michael Prabhu June 06, 2004 – HolySpiritInteractive Issue #23
Conybio: What a Con! Holy Spirit Interactive: New Age [see the record in articles CONYBIO, page 5 and BIOCONNED!... page 2], links given by Austine Crasta, Moderator, KonkaniCatholics yahoo group on Sep. 19, 2007.
TODAY, ALL OTHER ARTICLES IN HSI ISSUE NO. 23 OPEN EXCEPTING CONYBIO!!!!!
From: henry quadros To: email@example.com Sent: Saturday, February 18, 2006 8:36 PM
Dear brother, We read some of your articles in Streams magazine and we wanted to find out if DXN products have any connection with cults or is it a harmful alternative system because the organisation is world renowned and functions similar to Conybio. We had confusion about this for a long time and we didn’t know whom to ask. After reading your articles we understood that you are the right person to ask these things as your ministry deals with such things.
INDEX ON PAGE 74 READ MY COMMENTS, PAGES 39, 40
Can you please enlighten us on this matter? What worried us was that there is one formula (mushroom powder) for practically every ailment and it is very high priced. Many people all around the world use it originates from East Asian countries. They have a variety of products from tea to lipstick at very high prices. Anxiously waiting for your enlightenment.
Br Henry Quadros
MY RESPONSE: [NO RESPONSE FROM HENRY QUADROS. REMINDER 30.05.06, NO RESPONSE]
Dear Bro. Henry, I thank you for your letter to me and I apologize for the delay in responding to you.
Henry, I do not know anything about DXN* even though I carefully read every magazine that I come across.
Maybe if you post me some literature I can read it and decide.
It could be an MLM [Multi-Level Marketing] thing, like AMWAY for instance. I know one company pushing some tea but it is not occult stuff. The preacher [X.X.] is into marketing it. I myself do not even approve of MLM because I suspect that the principles of MLM operations are not Christian.
If you want more than the abridged stuff that comes in STREAMS, please visit my website. But if you don't have access to the internet, please tell me and I can send you hardcopies of the same. In that case, if you could please tell me more about yourself and the extent of your involvement in the Church and the Renewal, it would help me to know what to post to you. I have many articles which are only in hardcopy and therefore still NOT on my website. Love and Prayers, Michael
*http://www.dxnmalaysia.com/ DXN is a multi-level marketing (MLM) company founded in 1993, based in Malaysia
A QUERY ABOUT CONYBIO IN KONKANICATHOLICS
KONKANICATHOLICS DIGEST NO. 485 QUERY: Is it OK to Use Conybio?
QUERY: Is it OK to Use Conybio? Posted by: "YYY" firstname.lastname@example.org Sunday March 4, 2007
I have gone to your site and glanced thru Articles. Noticed CONYBIO. Can you give some insights on this as I was panning in buying some of these items, and like me many must have already or are panning to do the same. Can you please let me know from the Catholic point if it is right the use these items YYY, DUBAI [MY RESPONSE WAS NOT ARCHIVED]
KONKANICATHOLICS DIGEST NO. 486 March 5, 2007
Dear Michael, Thanks a ton for the useful piece of advice. Probably this could be why the Lord was holding me back from buying this stuff. I hope and pray that all my other brothers and sisters who are using this and/or intend to do the same will read this piece of advice and act accordingly.
Michael, I would also like you tell me something about AMWAY products also, my brother is into it and have managed to drag me also, much against mine and my husband's wishes. I am not into it fully (i.e. attending meetings and making more members) just once I have purchased some of their products. Please advise. YYY
Dear YYY, At the JY Conclave in Kengeri, I mentioned that there are three issues on which I lack information, but which are highly suspect. One of them is Neuro-Linguistic Programming or NLP*. I cannot recall the second. The third one is Multi-Level Marketing or MLM. *The article will be available shortly
AMWAY is MLM. I do not know much about it as I said, but there are obviously unChristian aspects to it. One of them is that one has to maintain a split personality, another is the method[s] of selling, but I do not want to commit anything till I have some concrete evidence, preferably testimonies. I have met senior people in ministry who do MLM on the side to make money. My observation: for one thing, they seem to be now depending on their own abilities rather than Providence, and the other is that they talk FIRST and MORE about the products that they are selling than about the Lord and Kingdom work, because they have to sell you something, which is not the Gospel!!!! [And that would apply to me too even if I were not in fulltime ministry.]
One can immediately see that their priorities have changed!!!!! Check out and see what the FIRST thing is- that comes to mind- when one meets someone new. Does one look at him/her as a link in the chain and someone who will enhance one’s position in the group, and also be a source of income to one? I am not saying that it is terribly bad. And I don't want to be accused of being narrow-minded or condemnatory, but for believers it is something worth thinking over in case they have been affected but never realised it. Speaking for myself, I would like that when I meet someone for the first time, I would think of them as God's children whom I might be required to minister to, or be ministered by. Not as prospects for MLM. Sorry I can't do better than that right now. Love, Mike
KONKANICATHOLICS DIGEST NO. 490 March 9, 2007
Hi Michael, Do not know of NLP. But on MLM - I think we should separate the two and keep the line clear. No I am not in MLM. One is business and the other is Gospel. Church and its contacts better kept off this line of activity. Daniel CHENNAI
[Dear Daniel] Interesting reply - Similar to the one, quite often heard 'My faith is between me and My God'.
What happens in such a statement, the very purpose that God chose you ('Go preach, and make disciples') is lost. How can one say he led a good Christian life, if he has not led even one person to know Christ the Saviour?
Similarly business and Gospel, cannot be separated, There are many ways to become rich, being a mercenary means good money, well that is his business, so he keeps the Gospel out of it - forget that the Gospel says, thou shalt not kill? Or a businessman who cheats - that's his way of making money - forget thou shalt not steal? Well truly, we cannot, just cannot separate CHURCH and our day to day activities - We cannot become Christians only in Church. And what Bro. Michael says is right, for every MLM agent, every person he meets becomes a prospective agent, through whom he can profit. God Bless Salvador Fernandes DUBAI, UAE
From: milagres pereira To: michaelprabhu Sent: Monday, March 23, 2009 2:14 PM Subject: ticket
What do you think of this? I tried this google search 'Is Amway new age?' And this is what I get.
You know I hear many good Christians fall into this trap of money greed.
Milagres Pereira, GOA
1 See page 11
2 See page 11
AMWAY, THE AMERICAN WAY IN INDIA
Amway came to India in 1998. Home page: http://www.amway.in/HomePage.aspx
With soap in their hands and hope in their hearts Ramjee Chandran 30 April 2002
http://mlmcrimealert.blogspot.com/2008/02/with-soap-in-their-hands-and-hope-in.html From Economic Crime Watch
Bangalore: According to the local office of Amway India, about six thousand five hundred Bangaloreans have already signed up to become Amway salespersons. These 6,500 people have paid the USA-owned Amway Corp. Rs 4,200 each. 6,500 x Rs 4,200 = Rs 3 crores. (Almost) Cash up front. And that's only in Bangalore. A Bangalore company probably can't raise this kind of money in the stock market in these days of tight money conditions. But Amway did. Without advertising. Without the great dollops of press coverage that even the launch of a new whisky usually generates. It's all word of mouth, we are told. Word from the mouths of people living abroad who have been told by Amway to call their kith, kin and caboodle in India. Word is also out to spam you on the internet. Spam is unsolicited promotional material - junk mail on the Net. Word is out to send you cheap postcards. Calling, writing, faxing or spamming people in India to tell them of the good news. The good news is that they have the means to 'help' you to change your life. To 'own your business'. To 'earn your freedom'. To 'not just get a life, but get a lifestyle'.The subliminal message is: Stop being a loser. Whatever you've been doing with your life, it is worth less than what you can do as an Amway salesperson. When I put this last proposition across to an Amway sales person, his response was this: "You've hit the nail on the head. You're right. That is the case." He explained further: "You don't have to give up your publishing business (thank god!). Use your spare time profitably. What do you do when drive to work? Nothing! What do you do in the evenings? Watch TV? Pah!" Right through this entire opening phase, something nagged me. There was no mention of what Amway did. What was the 'word' that this guy kept talking about? What was Amway selling? I asked him. "The dream, my man," he replied his face aglow "the dream. Amway is not selling you anything. Amway is giving you a 'business opportunity' you cannot beat. "The 'business opportunity' to do what?" I asked, still confused. "The opportunity to use world class products. The opportunity to get others to use world class products. The opportunity to change your life." "What world class products?" "Only the best." "Name one product." "Many products. 10,000 products. From shampoo to Chrysler cars!" "I can buy Chrysler cars in Bangalore?" "Not yet. But the day will come. Maybe not Chrysler cars but maybe Marutis." "I can buy a Maruti through Amway?" "Of course! When they tie up the deal." "What deal?" "The Distribution deal. If Maruti is smart, they will understand that in a few years, only multi-level marketing will survive. Even Bill Gates said it. The end of retail selling is here. Amway will overtake them. By the year 2000, no one will buy anything from shops." "Which shops?" "Any shop. Every shop." "Nilgiris, Shoppers' Stop, Folio and Bata will all close down?" "Yes, of course." He sounded a little exasperated. Then he became paternal. He employed the tone one uses to talk to a friend's child. "Are you aware of Amway?" "Yes," I replied "I have read everything they gave another salesman like yourself. And I went to an Amway meeting." "Then you have learned nothing, my friend, nothing! You must have spoken to the wrong person. The world is going to change. Haven't I already told you that retail selling is dead?" I did not give up. "Where is this place where they stock 10,000 products? I'd like to see it for myself." "Well, it's not 10,000 products yet. But it will get there." "How many products do they have right now?" "That's immaterial. You're just being pedestrian." "Tell me how many products do they have?" "Six." "Six of what?" "Detergents, a great Liquid Organic Cleaner which you can pour into your plants after cleaning the floors and Dish Drops which will make your glassware shine like anything!" Before I could speak, he added: "They also have a lotion and a shampoo. But why am I telling you all this. The point is not the products but the opportunity. No matter what the products are, the opportunity will make you lots of money. And then you can retire. What is needed is not for us to quibble about details. We - you, me and everybody - must do all we can to make this succeed." Then, totally pickled in his own sales pitch, he began to shout: "GET OFF THE POT! GET ON THE PHONE, MAN, AND SPREAD THE WORD!! USE YOUR MAGAZINES AND TELL LAKHS OF PEOPLE THE GOOD NEWS!!!" So I got off the pot, picked up my phone and began to research the story.
How it works Amway's operations rest on what is called Multi Level Marketing (or MLM). It has been called 'network marketing', 'pyramid selling' (a phrase that inspires vitriol among Amway types). It has also been compared to a chain letter or the buying of a lottery ticket. How it works is both simple and complicated at the same time. You try and sign up others as fellow Amway distributors. You get commissions on whatever they buy. You also get commissions on the purchases made by the people whom they in turn sign up as Amway distributors. The more people you sign up, the more they will buy. The more they buy, the more money you will make.
How to become a millionaire: Now I will explain the 9-6-3 scheme because every Amway distributor talked about this. Having signed up, you get 9 people to sign up. Next, each of the nine people gets 6 people to sign up. Then, each of those 6 people gets 3 people to sign up. Here's the calculation: You = 1. You x 9 = 9 people. 9 x 6 = 54. 54 x 3 = 162. Total = 226 Amway distributors in your group. If you achieve this target, you no longer 'belong' to someone else's group. You become a 'direct'. The next assumption is that each of these 226 people in your group will buy an average of Rs 1,500 worth of Amway products every month. 226 x Rs 1,500 = Rs 3,39,000 per month. For every Rs 1,500 worth of product purchase you get 50 PV (Point Value). It works out to about 3.34% of the value of products bought. For every PV you get a commission. It's called 'bonus'. There is a (telescopic) slab system to determine your bonus. The lower the quantity of purchase, the lower the commission. Till you reach the level of 200 PV (that's Rs 6,000 worth of goods), you get no bonus. With 200 PVs, your earnings (bonus for that month), will be Rs 180. When you (together with your group) buy Rs 15,000 worth of products, you will get 500 PV. Your bonus on this will still be 3% and your personal income will be Rs 450 per month less whatever is to be shared with the others in the group. If you and your group members buy Rs 3.39 lakhs worth of Amway products every month, you will earn 11,300 PV. Your bonus on this will be 21% and you will earn Rs 71,190.00. After sharing your bonus with the others in your group, you will be left with Rs 40,500.
Amway Products vs. Other Products
G&H Body Lotion 250 ml Rs. 316 Nivea Lotion 250 ml Rs. 110. Satinique (shampoo & conditioner) 250 ml Rs. 314 Sunsilk (shampoo & conditioner) 250 ml Rs. 85. Dishdrops (1 litre=4 litres) Rs. 420 Godrej Concentrate (1 litre=4 litres) Rs. 64. SeeSpray Concentrate (1 litre=4 litres) Rs. 290 Colin Glass & Household Cleaner 4 litres Rs. 252. Amway Zoom Concentrate 1 litre Rs. 299 Robin Cuffs N Collars 1 litre Rs. 128. LOC High Suds Organic Cleaner (1 litre=167 litres) Rs. 322 Teepol, 5.5 litres=167 litres Rs. 352.
(NOTE: I could not work out a way for people to spend Rs. 1500 a month without wasting the product.)
At this level, the bottom 162 people in your group make no bonuses at all because their PV is less than 200, having bought only Rs 1,500 worth of product. However, you have nothing to worry about. You will make bonuses on their purchases because their PVs are counted in your tally. Remember, you will earn this Rs 40,500 a month only: 1) IF you get to sign up 226 people; 2) IF you make sure that each and every one of the 226 people buy Rs 1,500 worth of products EVERY MONTH; and 3) IF every one of these 226 people has the ability and the desire to pay Amway prices (see box) because Amway makes the claim that their products are 'world class'. When you get 226 people in your group, you become a 'direct'. Your commission drops to 4% on the purchases of the group. Then what? Then you go sign up more and more people if you want to make more money. If you want to become a millionaire, you will need to sign up several hundreds of people and have them all buy more Amway products. If you are the poor sod at the bottom of the heap, you will be told 'if you work hard' you can sign up hundreds, why thousands, of people from anywhere in the world to become Amway distributors and that, by 'working hard', you can beat the odds and become a millionaire. (When you become a millionaire - by 'working hard' in your spare time - you can buy the BMW they kept showing you in the promotional videos - the one that had the stereotype honey-blonde draped over the dude who was playing golf.) You are also being told that if you aren't making nice dollops of money, it is because you aren't 'working hard'. The definition of 'working hard' is to get as many people as you can to pay Amway Rs 4,200 to become distributors. There's another way. That is to sell products door-to-door or person-to-person. You could do that too. There should be nothing to stop you from lining up outside apartment buildings with the dabba distributors of Bangalore (see photo) and sell Amway shampoo for Rs 315. You could also be posh and invite the ladies of your kitty party for tea and then sign them up or sell them shampoos or detergents.
The positive side to Amway Let me say that the above is the positive side to Amway. That is, the chance to make money. It is the chance to get oneself involved in a trade as a side business, especially if one is trying to recover from a failed (or failing business) or one has lost one's job. To the extent that a few people will surely make money, the system works. Alas, that's not where the story ends. Because for every one who makes money, there will necessarily many who do not. Indeed, as I went along from Amway distributor to Amway distributor, I found myself vastly better informed than most of them, with the exception of one articulate couple. They spent over 2 hours with me, explaining the nitty gritty of the commission structure, despite reservations. I thank them for this. In direct contrast was my experience with the people at Amway's nice office on Airport Road.
Hiding from questions I spent 2 hours in the Amway office on Airport Road. The administrative manager, Arijit Mitra turned out to be extremely personable and a gentleman. However, he did say that he would not be able to answer any questions about the details of the scheme and indeed, he wanted to know why I wanted to write an in-depth story. His colleague, a lady that distributors speak to, first told me that she would come back in 10 minutes and then she vanished from plain sight. After one and a half hours, there was no sign of her and Mitra kept me engaged. Then another lady came out and told me that she was 'very busy'. I told her I would wait indefinitely. Then Mitra reappeared from the bowels of the Amway office and looked apologetic. He said his colleague would not meet me because she did not want to meet me. He explained that she was not 'authorised to talk to the press'. I tried to ask him to tell Vinitha not to hide inside the building and that my questions were very simple. But no dice. I never got to ask questions of the very person who was qualified to answer them. Then I asked Mitra to call her superior (Gowri Someone) in Delhi so I could talk to her. He did. He told me that she had told him the same thing. Mitra asked me to go to Delhi and speak to someone called Steven Beddoe. He said there was no one in Bangalore who was authorised to talk to the press. I asked Mitra why Amway had people in Bangalore who were authorised to take money from Bangaloreans but no one who could be accountable for this. Mitra had no answer.
The underside of Amway My basic problem with Amway is that I believe that the success of some is dependent on the failures of others. That is: 1. Amway will make money; and 2. Some distributors will make money; but 3. Both will do so at the expense of the many who may not.
And those who don't will probably be middle income people for whom Rs 4,200 is a major piece of investment. (My accountant spends less on school fees for his two children for the whole year.) As a quick aside, let me quote the 'zero sum theory'. For those who might not know it, this is a theory propounded by the famous economist, Lester Thurow. His book 'The Zero Sum Society' explains it in detail with a lot of econometric models. It will take me over a 100 pages to go into all that. Basically, Thurow said that for every person who has made a certain amount of profit, someone else has made an equivalent amount of loss. This is like the horse races. Any Turf Club will make money. A small number of bettors will make money. (One of them will hit the jackpot.) The only way that the Turf Club can make someone rich is because thousands of hopefuls lose their bets and their money. It is the losers' money which is collected and passed on to the lucky ones. The lottery works in pretty much the same way. I am not saying that Amway is like a horse race or a lottery. But the overall money movement and the odds of someone becoming rich are startlingly similar. This is better explained with numbers. Remember how many people you need to sign up? I'll remind you - 225. If you must get 226 people (including you) to sign up, then consider this. 6,500 people (in Bangalore alone) have already signed up. Each one of them hopes he or she will make a lot of money. It is reasonable to expect that if one Amway distributor stands a chance of becoming a millionaire, then every Amway distributor should stand an equal chance of becoming a millionaire.
Otherwise it is exactly like a horse race. So, if all 6,500 people adhere to the 9-6-3 formula, then hold on to your hat when you read this. 6,500 x 9 = 58,500 Amway distributors 58,500 x 6 = 3,51,000 Amway distributors 3,51,000 x 3 = 10,53,000 Amway distributors. That's Ten Lakhs Fifty Three Thousand (or 1.053 million) Amway distributors for the city of Bangalore. An employee of Bata Shoe Company, (the masters of retail selling), told me they employ about 30,000 sales people in their 1,500 stores across the nation. 30,000 Bata sales people for the whole of India. 10,53,000 Amway sales people only for Bangalore. The standard response to this is that all these Amway salespersons are not necessarily going to be in Bangalore. You can pick up the phone and call someone anywhere else in the world. Therefore, you can call your cousin in Ooty and tell her the 'good news'. She pays Rs 4,200, then she will call her nephew in Raichur who will pay Rs 4,200 and he will call someone else who will pay Rs 4,200 and so on. All this is done in the hope that more sign-ups mean more people will buy Amway products. So if not 10,53,000 Amway sales people, how many will actually operate in Bangalore? Let's hazard a guess. Half ... 5 lakh salespeople? 2 lakh sales people? 1 lakh sales people? Will there be any left at all? Two days after my visit to the Amway office I received a call from the Amway HQ in Delhi, from Steven Beddoe, GM, Distributor Services. He told me that the numbers would never grow to what I have mentioned above. Because I persisted, Beddoe suggested that the possible number of Amway distributors in Bangalore would be about 1.67% of the middle class population. Bangalore's population is about 5.2 million. Of this let's be conservative and say that 25% are middle-class. That is 1.3 million of which 1.67% (21,710) would be Amway distributors. Beddoe reacted again. He said he didn't think that the total number of Amway distributors would be that many. (He even said that the number was less for a certain South Asian country.) I asked him if that number could be as low as 10,000. He said that was a possibility. (10,53,000 to 10,000 and we still don't have a number.) Then the chances of people making money is slashed because Amway themselves are suggesting that each person will sign up less than 2 other people on an average. Therefore, if some of them manage to sign up 226 people, many others won't sign up people at all. And if you divide this number - 10,000, into groups of 226, then the total number of 'directs' in Bangalore will be 44.10,000 - 44 = 9,956 Amway distributors who do not stand the chance of becoming 'directs'. Who will be among the lucky 44? You? I asked Beddoe to help me with this puzzle and apart from giving me philosophical discourse, he couldn't address the matter of numbers. All he said was that Amway distributors should sign up more and more people. Which brings me to me to my next thought.