As promised, here are some comments about the Amway UK IBO sanctions:

I am assuming at this point that you have read about the Amway UK IBO sanctions. If you haven’t read about them, click the link above and then come back and post your opinions.

Amway UK is a small market for Alticor, (Amway/Quixtar’s parent company) so the monetary affect of these sanctions is not huge on the overall volume of the company.

My personal opinion is that this is a shot over the bow of Quixtar in the U.S. This is about Alticor showing the IBO Leaders (Britt, Winters, Puryear, Woodward, Yager, etc) that the company is serious about cleaning up the training and tools mess.

If the old school tools boys don’t clean up their act, it is now apparent that the company will step in and clean house.

But…(you knew that was coming, didn’t you?)

But, Quixtar is not nearly as lucrative as an opportunity if you remove the tools income that begins in many cases at the Platinum level. I would even go as far as saying that the tools income is what keeps Amway/Quixtar leaders from leaving for a different company with a better compensation plan.

Quixtar pays out roughly 30% back to it’s IBO base, yet the average of the top 30 companies in the industry is roughly 37% payout. Why would IBO Leaders stick around Amway/Quixtar for years when there is more money to be made elsewhere?  It’s all about the secondary business of books, CDs, seminars, voice mail, and web sites, collectively know as the tools business. Take away the tools business and Quixtar Leaders are paid 20%  (a conservative number) less than leaders in other companies for the same volume.

The IBO leaders are in a bit of a bind. They clean up their act or the leaders keep on trucking and Quixtar comes in and cleans up. Either way the leaders stand to lose a lot of money.

Will all of this be better for the individual Amway/Quixtar IBO? Probably. Would the individual Quixtar IBO be better off by finding a new opportunity at this point? Probably. I would be willing to bet that BIG TIME IBO leaders are already looking around at other opportunities.

I said this about USANA and it applies to Quixtar at this point as well. The company will survive all of this, but it will get worse for the typical IBO before it gets better.

Update: I re-read the letter and noticed that this UK action is in response to "serious concerns raised" by the Department of Trade and Industry (DTI). That has me wondering whether Amway would have done anything if not for a pending crackdown by the DTI. 

Your comments and theories are welcome…