Is Amway a pyramid scheme or just a legal MLM?
While I have a feeling this will make it’s way over to Great Debates or the Pit, according to to a search on google.com that lead to this page http://www.factsource.com/srmlm.html the important info IMHO is here. Quoted from that article <p>
In 1979, the Federal Trade Commission (FTC) took the Amway Corporation to court. The FTC claimed Amway was a pyramid scheme. It was ruled that Amway, although they were engaged in deceptive practices, could continue to operate within the law as long as profits were made through sale of product. A legitimate multi-level marketing company has a product line that is sold to new and existing distributors who are in turn expected to retail this product to other people, thereby earning a profit. 70% of purchases by distributors are to be sold or consumed each month to avoid stockpiling of product. </p>
By the way earlier I forgot to welcome you to the board so Welcome to The Straight Dope.
Used to prepare & review tax returns. Must have seen a thousand Amway Scd C returns. Never, not once did i see one with a profit. The only Amway return i saw with a profit was one that was done by some folks who had the good sense to not sell the stuff- “upline or downline”- they held amway “Rah-Rah” seminars, and raked in BIG bux telling folks how they could get rich selling Amway. Think about it.
What about Quixtar? I have some friends who are into that, doesn’t seem to be making them much money but they are converting more and more people to their cause…
Ah, just checked that link, they are the same thing.
Beware! Amway have reinvented themselves as a2k.com, with a highly stylised gold logo. A couple of my friends (who I thought would have been more sceptical) have been sucked in. I’m just waiting for the novelty to wear off…