Amway is a multilevel marketing company offering business opportunities to distributors who sell home products to consumers and retailers. Jay Van Andel and Rich DeVos established Amway in the 1950s and began the business by selling Nutrilite supplements as door-to-door salesmen. Distributors sell Amway products in over 80 international territories and in the U.S.
History
In the 1960s Amway expanded its product line to over 200 items and had over 100,000 distributors. In the following decade, the company expanded its sales territory to reach global markets like Tokyo, and Amway surpassed one billion in sales during the 1980s. The sons of Van Andel and DeVos took over running the company in the 1990s, and today Amway remains a multibillion dollar business. It is partnered with over 3 million distributors, as of March 2010.
Product Types
Amway sells Nutrilite nutritional products like vitamin and mineral supplements, meal replacement shakes and snack bars along with other health-related products like sports drinks. Beauty product offerings include makeup, micro-dermabrasion systems and anti-aging product lines. Home products include water purification systems, cleaning products, baby care products, air freshening products and pet food and supplements.
Business Model
Amway distributors sell products to consumers through in-person meetings, catalog marketing material and online store portals. Distributors may also choose to sponsor other independent distributors in a multilevel marketing business model. Recruiting other independent distributors can result in monthly monetary incentives, depending on how well your sales group performs.
Compensation
Amway distributors earn money by selling products at Amway’s suggested retail price and pocketing the difference between the cost of the product and the sale price. The retail margin markup compensation is 29 percent, according to Amway, although distributors can choose to sell products at higher or lower prices than what Amway suggests. Amway may also offer monthly bonuses equivalent to 3 percent to 25 percent of a distributor’s monthly sales volume, as of March 2010.
Considerations
Amway distributors are not confined to a regional sales territory and may sell Amway products throughout the world. Distributors are only responsible for procuring orders. Amway is responsible for the processing and shipping of products. Amway offers online, print and visual media marketing tools to assist Amway distributors in expanding their business.
