Independent Business Owner NotebookTable of Contents

INTRODUCTION

Amway Facts & Milestones …………………………. 1

1. REASON/DREAM ………………………… 3

2. COMMITMENT ..…………….………. 5

3. LIST ……………………… 7

4. CONTACTING ……………………… 8Contacting Approaches …………………………. 9Sample Contacting Scripts …………………………. 12Contacting Flow Chart ......................................... 14

5. PRESENTATION ……………………… 15Qualifying Interviews …………………………. 15Presentation of the Business Plan ......................................... 18Compensation Plan Example ……………..…………… 21

6. FOLLOW THROUGH/STRATEGY...………………… 22Registration Process …………………………. 22

7. REVIEW PROGRESS/STRATEGIZE ………………… 24

Understanding/Maximizing PV/BV ……….......................... 25Ditto Delivery and Fast Track Program ……................................ 26

8. REPEAT PATTERN (LEARN, DO, TEACH) …….. 27Prospecting Tools and Top Audios ………………………….. 27Recommended Books ………………………….. 28

9. FREQUENTLY ASKED QUESTIONS ………….…. 291) Business, Legal and Tax Questions ……..…………….. 292) Negative Web Sites .………………………….. 303) What About Prices? ….........…….…………….…… 314) Business Support Materials – The Financial Side .….......... 325) Amway Versus Other Businesses .…………………… 33

GLOSSARY OF TERMS .…………………… 36

Jan 2012

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INTRODUCTION

Amway Facts & Milestones

Profile – Amway is a business opportunity company offering entrepreneurs the ability to have a business of their own through Amway’s I-commerce business model. I-commerce empowers Individuals to market products and manage their own business via the Internet, while being compensated by the low-cost, low-risk Independent Business Ownership Plan, and supported by the full-service infrastructure of Amway. In 2010, Independent Business Owners (IBOs) powered by Amway, generated more than $9.2 billion in sales. This was a $800 million increase over 2009. Their efforts have propelled Amway to be named the number one online retailer in the Health & Beauty category, according to Internet Retailer’s “Top 400 Guide”. Based near Grand Rapids, Michigan, Amway supports over three million independent businesses in 86 countries and territories.

History – The original Amway catalog business was created by Rich DeVos and the late Jay Van Andel in 1959. In 1999, Quixtar.com was created as a separate business to capitalize on new technology and e-commerce, and quickly became the company’s exclusive North American business opportunity. Since then, Amway affiliate markets around the world have adopted e-commerce, lessening the need for a separate, web-based brand. In 2009, Quixtar North America rejoined the global business under Amway. Steve Van Andel is Chairman of the parent companyAlticor; Doug DeVos is President and Steve Lieberman is Managing Director.

Products, Services, and More – Best known for its Health and Beauty offerings, Amway features exclusive brands that include:

• NUTRILITE®, the world’s leading brand of vitamins, minerals and dietary supplements (in tablet/capsule form, based on 2010 sales).

• ARTISTRY® skin care and cosmetics, one of the world’s top five largest-selling prestige brands of facial skin care and color cosmetics (based on a study by Euromonitor International).

• eSpring® water purifier, uses UV, only residential system to meet all three NSF water standards

• ATMOSPHERE ® air purifier, twenty times more effective air cleaning than Ionic Breeze

• iCook® one of the highest ranked and lowest cost stainless steel cook ware brands in the world

• XS™ Energy Drinks, the second highest selling energy drink in the world, and the number one selling American made energy drink.

• Legacy of Clean (LOC) household cleaning products include SA-8, the number one ranked laundry detergent in the world according to a leading consumer magazine.

Amway has also contracted with manufacturers and over 100 major online partner stores and catalog companies such as: Sears, K-Mart, Best Buy, Office Depot, Barnes & Noble, Bass Pro Shop, Ace Hardware, Dell, Disney Store, FTD, eToys, Hickory Farms, Avis, Days Inn, Visaand many more.

Compensation – Income is earned from the retail sales of products and services, and through monthly performance bonuses ranging from 3% to 25% of business volume from retail sales, personal volume and the volume of sponsored Independent Business Owners. See chapter seven for more on the compensation plan or the Amway website for details.

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DATE AMWAY BUSINESS MILESTONES

1934 Nutrilite was founded and invented and produced the first multivitamin.

1959 Rich DeVos and Jay VanAndel found Amway.

09.01.99 Amway officially launches Web-based business. (Quixtar)

11.13.01 Business 2.0 ranks Quixtar.com #1 in sales for the online Health & Beauty category, with 20.5% of the estimated $1.45 billion market segment. Based on the analysis of Nielsen NetRatings and Harris Interactive eCommercePulse, Quixtar was ranked ahead of Drugstore.com (12.2%), Avon.com (4.5%) and MaryKay.com (4.1%).

10.13.03 Quixtar announces its national partnership with Easters Seals as a leading corporate partner and presenting sponsor of “Walk With Me,” Easters Seals’ signature event to be held in up to 75 countries.

06.10.05 In Internet Retailer’s annual “Top 500 Guide”, Quixtar was again ranked the top online site in the Health and Beauty category based on web sales.

02.01.07 Quixtar announces record 2006 retail sales of $1.118 billion. IBOs drove another $84 million to Quixtar Partner Stores. North American IBOs earned a record $370 million in bonuses and incentives. Parent company Alticor also announced over $6.8 billion in global retail sales.

09.01.08 As the Quixtar e-commerce model is successfully adopted throughout Amway businesses around the world; the Quixtar name begins transition to Amway Global.

02.05.09 Amway announces record sales of more than $8.2 billion for the year ending Dec. 31, 2008, a 15 percent increase over the $7.1 billion reported in 2007. There are less than 2000 companies in the world with total annual sales of one billion dollars.

05.01.09 Amway celebrates its 50th Anniversary. Miss America becomes Amway’s spokesperson for Artistry cosmetics and skin care.

06.04.09 Internet Retailer ranks Amway Global as the number one online retailer in the Health and Beauty category for the sixth consecutive year with almost half of the market share. Amway Global is also ranked 22nd overall out of all internet retailers.

02.05.11 Amway announces record sales of more than $9.2 billion for the year ending Dec. 31, 2010.

08.01.11 Amway has first $1 billion dollar month in June 2011. Over $90 million dollars and over one million hours are donated by IBOs and the corporation to charities.

10.01.11 Internet Retailer ranks Amway as the number one online retailer in the Health and Beauty category for the eighth consecutive year. With 12 months of consecutive double digit growth, Amway rises from the 44th to the 32nd largest privately held company in the world according to Forbes.

01.18.12 Amway announces record sales of $10.5 billion for the year ending Dec. 31, 2011.

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1. REASON/DREAM

Many of us have spent most of our time following the same schedules day-to-day … year-to-year.The discomfort, inconvenience, stress and sameness are overlooked in the hurry of going and doing. If someone had proposed our current lifestyle to us, we would probably modify it. Instead, as it develops, we adjust, accept, and ignore. If you could live life on your terms, what things would change? (Jerry & Cherry Meadows)

Small things?

What time you get upHow long your drive to work would beWhat you driveFlowers (a gift) for someone every month

Major areas?

One week per month vacation (go somewhere or just stay home)Being the “mystery giver” making someone else’s dreams come truePaying cash for a major purchase – a car, a home, etc.Retire early – it doesn’t take time to retire, it takes money

There’s a book titled If You Don’t Know Where You’re Going, You’ll Probably End Up Somewhere Else. Or put another way, if you don’t have a destination … you’re already there. A study showed that only 2% of a Harvard graduating class had defined and written down their long-term goals upon graduation. Twenty years later, they found that that 2% controlled about 97% of the class’s wealth.

There are numerous stories of people who have set goals and accomplished amazing things. Just as important are those many untold stories of those that set goals, missed them, grew because of the experience, and then went on to achieve. In his book Move Ahead With Possibility Thinking, Dr. Robert Schuller tells us; “It is better to attempt something great and fail, than to attempt nothing and succeed.” This is a great starting point to layout some goals of your own. Don’t feel awkward.This is a new exercise for most people. The first question that comes up is how do you set a goal?Keep in mind that any exciting goal will be one you’ve never accomplished before and therefore should be a new, perhaps even an uncomfortable experience. So what process does one go through?What is a “realistic goal”? A “realistic goal” is any goal you believe in your heart you can achieve. You may notice I didn’t say, “believe in your mind”. A famous Biblical quote tells us, “As a man thinketh in his heart so is he”. A goal isn’t something where all the facts tell us we can do it. That would just be an exercise. A “realistic goal” should be one that stretches you. Just the thought of accomplishing it creates excitement. It starts the adrenaline moving and gives you the energy to do something – right now. Let’s get started. A goal is not a goal unless it is:

1) Written Down

2) Measurable

3) Has a Date

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You’re going to hear terms like Goals, Dreams, Purpose, Vision, Reason, and Strategy. Depending on the teacher, they will overlap in their meaning. Regardless of which one we talk about, they all should have one important ingredient – they need to spark some excitement, light a fire and createenergy so you just can’t sit still.

We want to deal with each of these terms. You may have already observed that a man or woman with a purpose will outdistance a man or woman with a dream every time. A purpose is bigger than something for our self and cannot be accomplished by our self. Cherry and I, at various times, got a bigger picture or vision of what we were working for. It wasn’t just a material goal or pin – we felt we were working to preserve and expand personal freedoms and free enterprise throughout the world. We still feel that is a worthy cause and one we stay dedicated to. What creates a burning desire in you so you just can’t sit still?

My purpose is _____________________________________________. Date ______________.

Goals for us have been the levels of accomplishment in business. Whether these levels are in volume, number of people registered or profitable businesses established, or something else they are, as we said earlier, measurable with dates. What is the goal that lights your fire?

My goal is _________________________________________________. Date ______________.

Now that you’ve set some goals, you’ll have the answer to a question that is going to come to you when things aren’t going how you thought they would or should go. That question is “Why Am I Doing This”? If we don’t come up with a meaningful answer, whether that answer is a business pinlevel, or some reward, we start declining in our attitude, energy, and activity.

My suggestion would be each goal should have some proportionate reward with it – a dream. If you’re building it with a spouse, each can have their own dreams, but as you get closer you’ll want to come to an agreement on these dreams. Your goals and dreams should not be placed somewhere private, but where you can focus on them frequently.

Dreams should be viewed, touched and smelled frequently. Go experience them on a regular basis. What are some that spark you?

My top five dreams are:

1. __________________________________ 2. __________________________________ 3. __________________________________4. __________________________________5. __________________________________

Reasons for us were always more personal things we wanted to be able to do for our family: education (private, college), helping relatives, a home (even a second one) for the family, vacations, (or just time together), and special events. The reasons were not so material, as personal.

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2. COMMITMENT

A strategy for us has been the laying down of plans or micro (mini) goals. Step by step actions on day-by-day or week-by-week activities. However, the one thing we don’t want to do is to get so bogged down in planning and laying out a strategy that we lose our excitement and don’t get started. In our business, these criteria are easily stated in categories of PV, Qualifying Interviews(QIs) per month, new IBOs registered, Eagle and Pin levels, etc. Your goals should excite you; so they should not be too big …. or too small. Setting a goal that creates excitement in you also creates excitement and energy in others. It creates momentum. This contagious excitement can even attract others that would not otherwise have come. It can cause events that otherwise wouldn’t happen.

My strategy is the following Micro (mini) goals, or plans:

1. I will meet ______ new people each week.2. I will do _____ Qualifying Interviews (QIs) each week.3. I will register ______ new Independent Business Owners (IBOs) each month.

You should have long, intermediate, and short-term goals:

Month/Year Month/Year Month/Year

Eagle __________ __________ __________Pin __________ __________ __________

# of QIs __________ __________ __________ # Registered __________ __________ __________ PV – Personal __________ __________ __________ PV – Group __________ __________ __________ My date for 25% __________ __________ __________

Scheduling:

One of the most important steps you can take is to decide when you’re open for business. If you had any business where you were open only occasionally and inconsistently, how well do you think you’d do? Well, this is one characteristic similar to other businesses. If you are going to succeed in anything you must decide when you’re going to do it. To be successful in physical fitness or sports, you schedule your workouts. A successful musician schedules practice. A successful businessperson schedules appointments, office, or store hours. Do these people work out, practice “stay open” all of the time? For the most part, no, they don’t do their work 100% of the time. They just know when they’re going to work and give it 100% effort when they do. We’ve all heard people say they “either do something 100% or they don’t do it at all.” These are usually the kind of people that seldom do anything. Those that accomplish much are usually the same ones that are involved with several projects by scheduling them. You can too. You’ll best learn this by attempting to do more and setting up a planned schedule to do more. You can’t manage time but you can certainly manage yourself and the events in your life. There are many ways to do this and almost as many books on “time management”. Some good ones are Ten Days to a Great New Life and Success - The Glenn Bland Method. We recommend you read some of these.

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Calendar:

Step one: If you don’t have a calendar, get one (such as the TL-14 pocket calendar).Step two: Record on your calendar all of the events that you know are going to be a

part of your life for at least the next 90 days.

You should have the event starting and ending time in the calendar. When you start doing this, you’ll start controlling more of the events in your life rather than other people controlling your time. You’ll also find that there are many occasions where you can get two or more things done in a time frame just by scheduling. Whereas before, you would have used up the day. After you have recorded events already scheduled, you can see where you can find or make time for “doing more” but more importantly “getting more done”. Now schedule in what you want to be doing to accomplish your goals (personal, professional, recreational, etc.). When you start scheduling your events you’ll have started scheduling your life but more importantly you’ll have started scheduling your success. You’ll start scheduling the “progressive realization of a worthwhile ideal.” That’s what life is all about, isn’t it?

Working around Business Support Team calendar Learning the flow to free you up Learning a “duplicatable” presentationMeeting after meeting (Flow Chart)

It all does come down to a simple statement: “What am I going to do toward my goal in the next 15 minutes? What are you going to do toward your Purpose and Dreams RIGHT NOW? The phrase “A journey of a thousand miles starts with the first step” is a great reminder to focus on taking one step RIGHT NOW! Let’s keep these possible steps simple. Here are some:

Ø Make a list of people Right Now!Ø Call or text some people Right Now!Ø Drop a CD, DVD or book off Right Now!Ø Do a Business Presentation Right Now!Ø Take a Product Survey Right Now!Ø Help people make a list Right Now!Ø Listen to an audio Right Now!Ø Read part of a book Right Now!Ø Watch a video Right Now!Ø Set a goal Right Now!

There are techniques – a pattern of developing a network that we have proven to work. The pattern is simple and therefore can be duplicated. In fact, the key factor in any good technique in our business is going to be that it can be duplicated. If it is and it works, it is important and valuable. If it cannot be easily duplicated, it is not important and it’s expensive.

This business uses an 8 Step Pattern that is both highly effective and can be duplicated. This and the previous section covered the first two steps of this pattern. The first and most important step is defining your Reason or Dream for pursuing this business. Without that, the rest of the pattern and this notebook are useless. Before going any further it is vital that the reason, the dream, or purpose be identified and defined. The second part of the 8 Step Pattern is to set and commit to specific goals that will help you achieve your dream, reason or purpose. Only after these two steps have been accomplished is it time to move on to the next steps.

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3. LIST

The List is the third Step of the 8 Step Pattern. We were told when we began, to write down the names of everyone who is body temperature and breathing. That may sound a bit too broad, but the point is – just start writing names. This list naturally will include people of all ambition and income levels. Of course, the more names you have on your list, the more options you have. A good mini goal would be 75 to 100 names. Start with your cell phone. Pretend we gave you $100 for each name you wrote down. Could you write down 100 names for $10,000? Ultimately, if you build to Founders Platinum, each name will be worth much more than $100. A good piece of literature to help you develop your list is TL242 – Who Do You Know. Use this literature and all materials –they are part of the pattern that has worked so well.

Start with the most ambitious upwardly mobile people first. These will be the most open-minded people and some of your best business partners. Remember, just keep offering this to new people. It doesn’t take long to learn that you can believe in everyone, but don’t count on them to pursue this. In fact, you’ll find yourself periodically making new lists because you’ll be meeting more people in the future just as you have in the past. Remember there are more people you don’t know than there are people you do know.

One of the most common mistakes that many of us make is to “pre-judge”. We think, “they won’t be interested” or “they don’t need this”. Some may appear to us to have all of the things that they could dream of. In fact, they may have what we dream of. We don’t know what their dreams are. Also, looks can be deceiving. The average American is four to six months from bankruptcy or foreclosure if they lose their income. This applies to doctors, lawyers and other professionals too. Even if they have a quarter million dollar income, they usually have proportionally high expenses and debt to match their income. Also, employees and self-employed with very high incomes tend to be more dependent on politics or the economy. But what if they really are financially independent and in Kiyosaki’s “Business Owner” or “Investor” quadrant? That’s great. They will understand this concept immediately and may desire another passive income stream. Remember, they already think outside the box. Even if they don’t decide to pursue this, they will understand it faster than anyone else and may even be willing to give referrals.

8 Step Pattern

The next step is Contacting. Contacting will be covered in the next section but below is a quick summary of the Pattern. We’ve covered the first three steps. This Pattern works and we use and teach it (it’s also in your pocket calendar and chapters of this notebook match the 8 Step Pattern).

1. The Dream – Identify and Define Your Dream, Purpose or Goal

2. The Commitment – actions to achieve the Dream, Purpose or Goal

3. The List – the blueprint of your business

4. The Contact – effectively offering the opportunity

5. The Presentation – explaining the concept

6. Follow through – answering questions and getting people started right

7. Review Your Progress – counsel and strategize

8. Rotate the Pattern – learn, do and teach = duplication

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4. CONTACTING

Contacting is the fourth step of the 8 Step Pattern. The first three steps need to be completed first. Why? Because contacting is where the rubber meets the road and where many of us face our first challenge. The most common mistake in Contacting … is not contacting. The first two steps, the Reason and Commitment, are designed to help us achieve this critical fourth step – don’t skip them. The third step, creating the List, is equally important. We do not recommend contacting until you have a written list of at least 75 names. One reason is that only about one out of five of the population, are in the “looking zone” at any given time. That means of five people we contact, it’s possible that only one will really be open to looking at a business, an investment, a new job or … even a full moon at that particular time in their life. Seventy-five names gives us an excellent chance to personally sponsor at least nine IBOs, which is the first growth goal for building a large, stable and profitable business. Your Business Support Team will help you with contacting and caneven help make contacts for you.

The Perspective we should have:

We offer: A business model that already works (over $10B in revenue).Mentors with decades of knowledge and experience.A proven training and business development system.First class business support materials (“tools”).

Before contacting anyone, put yourself in the mindset that you are the CEO of your company (which you are) and you’re looking for a few division managers. That’s exactly what you’re doing; to be a Diamond you’re going to need at least six of these “division leaders.” You’re basically interviewing them to see if they qualify. To put it in employee terms, consider that you are really offering a business opportunity that has positions open that pay from $2000 to $3000 per month (Silver) to two-thirds of a million a year (Founders Executive Diamond and above), and beyond.

If those we contact are only interested in having a more convenient consumer experience or are interested in some of our exclusive products; we can help them by making them a Customer. However, we are looking for long-term business partners who we can help develop the business and share profits. We often say during a contact that we’re looking for a “few key people”. This is true because our time is limited, and we can only work effectively with a few people at a time.

So why, if we’re only looking for a few key people do we register those that we’re not sure will pursue this? Because, WE can’t determine if their reason is sufficient to persist. Only THEY can determine that, and we can’t risk their future and ours by making that call for them. We’ve learned that anyone can “become” a KEY person if their reason is big enough. Diamond Brett Daimler was labeled mentally retarded as a child!

Go through your script clearly and confidently, as if you’re the CEO of Dell and you’re talking to a potential employee. You’re considering whether to offer a position or partnership. You decide who you are going to work with. You can and will find your sixkey people with or without them but you’re offering them something that could change their life – and you have the numbers to back up its record-breaking success. Offer, but neverbeg, sell or try to convince. You’re looking for those who are looking … period.

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Anatomy of a Contact: Everyone must choose an approach that they’re comfortable with. Choose an approach that fits you and the situation the best. Make sure each contact has the following elements and guiding principles. Your Business Support Team will help you.

1) Greeting2) Reason (see Contact Approaches)3) Compliment (positive reason why you thought of them)4) Offer 2 dates, or ask when they’re not available (never ask when they are available) 5) Set the time (need 15 minutes and can be done any quiet place like a coffee shop)

Don’t try to explain this business during the contact. All we’re trying to do is set up a time to get together for a 15 minute Qualifying Interview. Trying to give a summary during the contact usually results in failure. Why? We all attempt to classify things into existing categories in our mind. This business model has never existed before, BUT that won’t stop someone from trying to categorize or compare it to something they know. Once they THINK they’ve identified it, they WILL make a decision and it will almost always be based on incorrect information. It may go something like this: “You know ... I had a friend whose sister dated this guy who knew someone who did something like this 10 years ago. He’s a serial killer now … so I don’t think I’d be interested.”

Be brief and positive. Be enthusiastic (recording your contacting approach may help). Be in a hurry and tell them you don’t have time to talk. If they’re hesitant to even look at this business, then they’re not in the “looking zone” right now. Let them go and ask someone else. You can tell them that you may be expanding again in the future, and if they’d like, you’ll be glad to keep them in mind. Don’t be defensive and don’t plead. You’re simply offering them the opportunity to take a look. They need YOU to pursue this business. You, on the other hand, don’t need them.

Contacting Approaches:

Do you have a second, or am I catching you at a bad time? ⇓

A friend of mine is expanding a business in the area and looking for a few key people. Realize this is out of the blue, but do you ever look at other career options or business opportunities?

We’re putting together a team of young entrepreneurs for an e-commerce internship. If you’re interested, we can run through a 15 minute interview/overview, see if we need to go any further.

A business associate of mine and I are working on an Internet project, and I thought of you. The more I learn, the more I think you’d have an interest. Can we talk?

If the money was right and it would fit into your schedule, would you be open to looking at a business idea?

Came across an e-commerce business concept. You’ve got a good business mind, thought you might be open to taking a look.

This is ___________, I’m sitting across from __________ and we’re putting together a business project. He/she said you were ambitious and might be interested in making an extra $2000 to $3000 per month. Was he/she right?

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Answering Questions:

What is it?

or

How does it work exactly?

or

Can you tell me more about it?

Sorry, don’t have time to explain it right now got to run, but I can give you a quick 15 minute overview and see if we need to go any further. Which would be better Thursday at 0:00 or Friday at 0:00?Are you familiar with Interactive Commerce? (no) I’m sorry, it’ll take about 15 minutes just to explain that part. What nights this week do you already have commitments? (yes) Great, let’s get together and go over the details.We work with large companies and help them transition to the Internet and they share the revenue with us. Are you familiar with that business model? (no/yes) Let’s get together for a quick overview. Absolutely. I already have some information to loan you. What nights this week do you already have commitments?

Is this network marketing?

or

Is this multilevel marketing?

What is your experience with network marketing? ⇓Actually, our model is similar to Amazon.com’s. For instance, when a Web site provides a link to Amazon, Amazon pays that site a certain amount for each product they sell via that link. Our business is the same, except that we’re the ones directing the traffic. Don’t have time to cover the details, let’s get together.Actually, this is a brand new industry specifically designed for the Internet. It has a referral based component known as Interactive Commerce. Companies like Amazon, Wal-Mart and American Airlines all use these programs. Are you familiar with that? Don’t have time to cover the details, let’s get together.

How much money are you making?

Enough to keep me interested, I’m on track to replace my full-time income. Fortunately, my income in this business is a direct reflection of my efforts.I just started my business but have already had some success. Be glad to introduce you to one of my business partners with a six figure income.

How much time will this take?

It will take 15 minutes to determine if we should even talk any further.

Would I have to sell? Do you like to sell? (yes) Great, you’ll love this.(no) Neither do I. This is network development. I can show you a quick 15 minute overview and then we can see if we need to go any further.

Do I have to know a lot about computers?

No. We aren’t the “techy guys” who built it. We develop the business networks.

Do I have to invest money in this company?

No, we’re fully funded. We’re looking for a few key people to leverage some time for a very promising return.

Is this like …? Why, we’re you involved with that? (determine their experience)(no) Actually, our model is similar to Amazon.com’s … (see above)(yes) We have a very successful referral based component but we’re a hybrid business model similar to Amazon.com’s. (see above)

Is this Amway? Actually, I have my own e-commerce business that’s powered by Amway.

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Handling Objections:

I don’t have much time right now.

That’s exactly why I’m pursuing this.

Actually, that’s why I called you. The reason to seriously look at this is so that you CAN free up some time. If it were worth it financially, could you make the time?

(Feel, felt, found …)

I don’t want to take more time from my family.

That’s exactly why I’m building this business – to add family time.We’re both working a job right now. The way I figure it, if we don’t do something different, we’ll be giving our time to someone else indefinitely.I agree. Would it be worth a few hours a week, primarily while they’re sleeping, to get more time with them?Would you be willing to invest some time now, so that you could potentially have all the time you want with your family in the future?

I don’t have evenings available.

No problem. We can work around that.Fine. We’ll help you leverage any time you can spare.

My company doesn’t allow me to do anything else.

They dictate what you can do in your free time?

You signed an agreement stating that?

My spouse won’t let me. I can relate! But someone had to take control of our financial future. No problem, we can work around that.That’s OK. Let’s think of some people who might be interested. Give me some referrals and we can work with them through you.

I’m busy right now. Can you check back with me next month?

Actually, we’re looking to add to our team in the next two weeks. But I can understand timing. So I’ll be glad to keep you in mind.Call me if things lighten up. We may be expanding again and I’ll be glad to keep you in mind.

Well … you know I’m not sure…

Hey look, I’m not trying to talk you into anything. Just wanted to show you how you could participate in the e-commerce explosion. I was excited to find something that let me go after a piece of the growth.

* If the following questions come up – too much may be being said during the contact.I’m not good at selling.* Good! We’re not looking for sales people.

That’s what I appreciate about this. You don’t have to push a thing. I wouldn’t be good at this. It’s not my personality.*

Good at what? I think you’d be great! If you haven’t tried, how do you know?

I’ve never known anyone who made money at this.*

Why don’t you go with me Tuesday evening and let me introduce you to several individuals who’ve been extremely successful.Really? Thank goodness I’m working with some very successful people on this. I have no question about the unlimited potential.

Is this a pyramid? * No. Pyramids schemes are illegal. It’s Interactive Commerce.Where you work, do you have a boss? They have a boss too, right? Can you make more money than they do? Sounds kind of like a pyramid. We’re definitely not a pyramid. In our business model, you can generate more income than I do.

I wouldn’t be interested in multilevel marketing.*

I wasn’t either. Most MLMs won’t be around five years from now. But we have a 50 year old, multibillion-dollar global corporation behind us. It’ll be here after we’re gone.

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Guiding Principles:

1) Purpose of a contact is to set up a Qualifying Interview (not explain it over the phone).

2) You are looking for people who are “looking”. If they’re not “looking”, move on.

3) Talk to people at your success/ambition level and above. They’ll see it faster.

4) Be brief – with belief. Be in a hurry.

5) Answer a question with a question: What do you know about I-Commerce?

6) Role play with contacting: Tell me and I’ll soon forget.Show me and I may remember.Let me do it and I’ll understand.

7) Experience Proves: 100% of the “maybes” and “I’ll try to make its” won’t be there. 50% of the “I’ll definitely be there”, will be there.

8) Remember the five P’s: Prior planning prevents poor performance.

Contacting Tools:

1) Confident Conversations book by Brad DeHaven2) “You’re One Away from an Explosion: Contacting & Approaches” (CD70)3) Your Active Upline (role playing and practice contacts)4) Contacting Cue Cards (past page and in the New Business Owner pack)

1) Sample Phone Contact Script

Greeting Bob this is Dave, did I catch you at a bad time?

Reason Won’t keep you, got to run in a minute but the reason I called is I’m working on an Internet project with some friends out of Nashville. It’s expanding and we’re looking for a few key people.

Compliment Always thought you had a good business mind. (or whatever other positive characteristics they have that you admire – this is important, whether they decide to look or not, they’ll feel good about your call).

Caveat Can’t promise anything, but be glad to run some numbers by you.

a) Interested We can do a quick overview in about 15 minutes and decide if we need to talk any further. Which is better for you, Thursday at ___ or Friday at ____?(Clear their calendar, or ONLY give them 2 dates initially. Don’t ever say “when’s a good time for you?” They will have to check with “everyone” & will never get back to you. If they can’t make those dates, THEN offer them another date.)

b) What Is It? Sorry, don’t have time to talk details that’s what we’ll do when we get together. or Are you pretty comfortable with the Internet? (most will say yes) Good, are you familiar with Interactive Commerce? (You’re answering a question with a question – otherwise they control the conversation. Never try to explain it over the phone – we’ve all tried and we’ve all bitten the dust).

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“No” (sigh) Well, it’ll take 15 minutes to do an overview. If you’d like to take a look, we can get together, if not, that’s fine.

“Yes” Great, pretty exciting concept huh? We can get together to discuss the details on ___ or ___.

If they still want more info – Look, I really have to go, but in a nutshell, we work with large companies and help them transition to the Internet and they share the revenues with us. Can’t explain more without pen and paper. If you’re not interested in taking a look, no problem.”

c) No Interest We'll be expanding again in 6 months, do you want me to keep you in mind?

2) Sample Phone Contact Script (using another for credibility)

Reason The reason I'm calling is that a friend of mine is expanding a business in your area and looking for a few key people. Realize this is out of the blue, but do you ever look at other career options or business opportunities?

3) Sample Phone Contact Script (referral contact)

Greeting This is __________. Don’t think we’ve met, but John Doe’s working with me on an Internet project in this area. You know John?

Reason We’re expanding and looking for a few key folks. John said some nice things about you. Can’t promise anything, but based on his recommendation, I’d be glad to sit down and run some numbers by you if there’s interest.

4) Sample Phone Contact Script (3rd person approach, non-telephone)

Reason Hey, I wonder if you could help me out. I'm expanding a business in the area and looking for some sharp people. Know anybody like that?

5) Sample Texting Script:

John, Friend of mine’s expanding a business in ur area, looking 4 some key people. Thought of u. Ever look @ other career options or biz opportunities? Dave (158 characters)

(If they are local and ask “What is it?”

e-commerce, can’t explain it in all in text :). If u r interested, let’s grab some coffee.

(If they are not local and ask “What is it?”

e-commerce, can’t explain it in 160 characters :). If u r interested, give me ur email. (check with your active upline for online video previews and webinars)

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(or

Contacting/Presenting Flow Chart

under 30 years no phone number

Textor Call

Callor Text

Use email or Facebookonly for initial contact

over 30 years old

Interactive Commerce Overview (ICO) workshop

non-locallocal

Direct Inviteto ICO/Plan

close friend other close friend other

QI (if single

may take QI to a Plan)

One-on-one presentation (by you or your upline)

Live Meadows or Yager Webinar (email invite)

Recorded Meadows Webinar (24/7)www.interactivecommerceoverview.com password: iwantresults

unable to

unable to

Check with your Silver or above for their site

For Stevens send to:

http://enternet-i.ibocity.com/ecommerce/a

bout.asppassword: qualify

or

www.enternet-i.netuser: enternet

password: qualify

unable to

Follow Up local: in person, use 1st Night Pack and follow up CDs after thatFollow Up non-local: via phone immediately after webinar, send them to:(1st Night) interactivecommerceoverview.com/information.htm password: crown(2nd) interactivecommerceoverview.com/moreinformation.htm password: meadows

DirectInvite to Webinar

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5. PRESENTATION

There are two steps or levels of presentation. The first is the 15 minute Qualifying Interview (QI). If a prospect passes the QI, then we take them to the next step – presentation of the business plan. If the prospect is single, or if they have a significant other who IS present, you can take the QI directly to a full presentation if there’s sufficient interest and time. If their partner is NOT present, DO NOT do the full presentation. Invite the prospect AND their partner to a business plan at anInteractive-Commerce Overview (ICO), usually scheduled weekly. If they cannot attend the ICO, or there isn’t one within a few days, schedule a one-on-one presentation. If the prospect isn’t local, set them up for a presentation webinar.

I. QUALIFYING INTERVIEWS:

Purpose: The purpose of a QI is not to convince or even explain the business in 15 minutes. It’s simply a filter designed to qualify the prospect for a full presentation. It’s intended to see if it’s worth your time and theirs to go to the next step and look at the business.

There are several reasons QIs are effective. A 15 minute overview/interview can be done almost anywhere, anytime. Several can be accomplished in a much shorter time than a full presentation. They are also more effective with younger adults who’ve grown up with fast paced media.

What if they are very interested after the QI and are available to see the presentation? You can continue to do the full presentation if they’re single or if they are a couple and both of them are there. The reason we don’ want to do a full presentation on half of a couple, is twofold. First, you may not be talking to the one who will be interested. Even if you are, they may get shot down trying to explain this to their significant other when they get home. Second, you don’t have time to show two plans to one couple.

Guiding Principles:

1) QIs should only last a total of 15 minutes. 2) The QI brochure (or 1st two pages of the Step 1 brochure) should be used, but not left with

the prospect.3) No materials or products (CDs, XS, etc.) should be left with the prospect after the QI.4) Doing a QI to both halves of a couple is optimal but not essential. However, if there is

interest, it is essential both halves attend the ICO workshop or one-on-one presentation.5) QIs can be done at coffee shops, book stores, etc. (any quiet, comfortable place).6) ICO workshop dress should be business attire. Sport jacket and dress shirt for men, and

business suit or dress for women. However, QIs can be done in business casual. We want to dress as well or better than our prospect, but no less than a collared shirt and slacks for men (no jeans). If the prospect is corporate … plan to match their dress.

Next is a “how to” guide for doing Qualifying Interviews with the QI Brochure. As a new IBO,it’s helpful to observe your Business Support Team (BST) doing a few QI presentations first. There are several excellent CDs on how to do QIs that your BST can provide. Practicing on your active upline can also be helpful.

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Qualifying Interview Guide

1. INTERVIEW (5 minutes)

a. Relax and Relate: Put them at ease. Build a relationship by asking them questions about themselves. Then ask them about their goals. For example, “Where do you see yourself in five years?” THEYshould be doing most of the talking … remember, this is a relationship building session and a relaxed interview.

b. After about 5 minutes of asking them questions and getting to know them, you can say: “As we mentioned, we’re expanding a business in this area and looking for a few key people. This will just be a high level overview to see if we connect on a few points. If there’s interest after this, we can take it to the next step (and see if we can get you into a workshop).”

2. CASH FLOW QUADRANT AND ECONOMICS OF DISTRIBUTION (Brochure – 5 minutes)

Rich Dad, Poor Dad – Wall Street Journal #1 Best Seller

Employees trade time for money, whether wage or salary. We all understand that quadrant. Self Employed have small businesses such as a restaurant, or they are a doctor or lawyer with a private practice. They have more control over their destiny but work almost twice the hours of employees. Both quadrants create Active incomes. They make money as long as they’re working. When they stop, so does the income. 95% of Americans are in these quadrants. Government statistics say 95% of Americans will hit retirement age: dead, disabled or broke. Coincidence? Share your experience in the E or S quadrant (your rut) and why you’re looking for something else.

Although 95% are on the left side, most of the money is controlled on the right side. The Investmentsquadrant is a great place to be. They live off of Passive income from their investments. They leverage Money. To succeed here, requires time, knowledge and large amounts of capital, “takes money to make money”. However, according to Kiyosaki, almost all of these people start in the Business System quadrant to create the capital and time to invest.

The Business System quadrant often starts as a Self Employed Business ... but puts a System in place so that the owner no longer has to be there to generate income. A good example is a franchise like McDonalds ... but only if you are the franchisor, not the franchisee. McDonalds continues to generate billions long after Ray Kroc, the founder, died. A Business System produces Passive Income like investments, but leverages Time instead of Money. (Share the lifestyles of your financially independent business partners who are on this side of the quadrant. Then transition to the next section.) To operate in the “B” quadrant, we take advantage of the economics of distribution.

3. GOALS

If time and money weren’t an object what would you do? Or, if you won the lottery, what’s the first thing you would do? We’re looking for people who have specific goals and are Coachable and Motivated.

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4. DISTRIBUTION MODEL

Manufacturers used to sell to Distributors, who sold to Wholesalers, who sold to Retail stores, who then used advertising to sell to Consumers. Wal-Mart streamlinedthe model by taking products straight from the Manufacturer to the Retail store. This made it more efficient, allowing them to sell for less and put their competition out of business. E-commerce takes it a step further. It eliminates the Retail store, taking product directly from the Manufacturer to the Consumer. E-commerce is replacing the Wal-Mart model. Over the next five years, it’s predicted that 50% of all retail sales in the US will be online!

5. SUPPORT/SUPPLY

We did $10 billion in revenue last year operating in over 80 countries and territories. We have access to almost any product or brand name through our PartnerStores. We’re also the #1 maker of branded vitamins in the world, have #2 selling energy drink, 3rd largest distributor of coffee in the US and the 4th largest maker of skin care and cosmetics in the world.

McDonald’s is the most successful franchise and restaurant in the world … because they have the best tasting food? No. It’s not their menu; it’s their business System (their marketing, training, locating, etc.). We are the largest non-government training organization in the world, and arguably, the most successful(mention/edify your support team).

6. REVENUE

- Phase 1: in 12-18 months -- $2000 to $3000 per month- Phase 2: in 2-5 years -- $150,000 per year and up

The income obviously depends on effort applied. Which of these income levels do you relate to most? If you were generating that income, what would that change?”

7. QUESTION

“Were there any points that you connected with?”“This was just an overview, but based on what you’ve seen, do you see a reason to get back together?”

Stop and let them answer. If they’re interested, and single, or both halves of a couple are present, and there’s enough time, you can continue with the rest of the presentation. If they are only one half of a couple or you or they don’t have time, schedule them into an ICO or for a one-on-one. Give them the meeting details. If an ICO, tell them what people will be wearing and that you’ll save them a seat. Confirm.

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If they say they don’t understand or don’t have enough information, explain to them that this was just a quick interview / overview to see if “we need to talk further.” If they’re still hesitant, they’re probably not interested. Let them go by saying, “Why don’t I put you down as a no. It was great to meet you.”

Presentation Tips for ICO Workshops and House Meetings

Dress: Although business casual is best for Qualifying Interviews (QIs) and meeting people, Interactive Commerce Overview (ICO) workshops and house meetings are a different environment. They are business events. For men we recommend a dress shirt and tie, with a sport jacket, or a suit. For women we recommend a dress or business suit. Why? The numbers show higher registration rates with business dress. People take a business more seriously if we are dressed as if we take it seriously. New IBOs often say, “I’ll freak my friends out if I show up with a tie (or dress)”. Good. You want an impact, rather than having them think it’s a social visit. Additionally, we know that their dress will impact their success, and they will duplicate what they see us do.

Presentation Preparation: Make sure you have the right tools available before the presentation.These include: 1st Night packs, New Business Owner packs, tickets for the next function and sample products. Check your schedule, and if you’re working with your upline, check theirs before the presentation, so you know when you can schedule the follow-up meetings (within 24-48 hours). Remember, 85% of those who register, register at the follow-up. If you expect more than one prospect, have a strategy to talk to all of them after the presentation. Seat your prospects at the front, and if you are not doing the introduction, sit with them unless or until the front seats are needed for more prospects.

Introduction: If your upline is doing the presentation, it’s important to introduce and edify them by giving some background and making some positive comments about them and the business. Initially, the only credibility the presenter has is what you give them during that introduction. This makes it easier for the presenter to break the ice and build a relationship. The presenter cannot easily talk about their success without sounding like they’re bragging. The presenter will also then be able to edify you once you’ve given them credibility. Introductions are for the speaker not the business. Simply give a little background on the presenter and their success along with your excitement about the business. If you’re not doing the formal introduction of the speaker, it’s best to edify them before you take your prospects to meet them (doesn’t look like “apple polishing”).

Presentation Interruptions: Distractions can not only knock the presenter off track but they also take away the attention of the audience, and possibly just at the point they needed to hear. Please plan ahead to remove as many distractions as possible. Ask everyone to turn their cell phones off during the speaker introduction. If you’re hosting a house meeting and have a land line or answering machine, turn the ringer and volume down. Answering any telephone during a presentation tells everyone that a random call is more important to you than the presentation. If you’re expecting an important call (such as a late prospect), keep the phone with you and stay at the back of the room so you can exit without distraction. It’s critical that children and pets not be a source of distraction. If someone brings them, see if you can engage them and take them out of the room. During the presentation, please avoid making comments to your prospect or getting up and moving around, serving drinks, etc., unless it’s required to deal with a distraction.

Business Materials and Sample Products: Please do not share the brochure, catalogs or products until after the presentation. You want the prospects attention on the presentation, rather than scanning catalogs or reading ahead. For one-on-one presentations, keep the brochure in your control to reduce the chances of them reading ahead. If you’re doing the presentation, use the Step 1 brochure. It lends credibility to your business, standardizes the presentation so that it’s easier to

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learn and duplicate, and it reduces the prospect’s fear that they will have to make presentations without notes.

Presenting the Business Plan

If an ICO is not available or the prospect is unable to attend due to a schedule conflict, your teamwill be happy to do one-on-one or group presentations for you. For greater flexibility, most IBOs will quickly learn to do their own presentations. Presenting this business is best learned “on the job.” The more presentations you see, the better. Your active upline or Platinum will be able to recommend several excellent audios and coach you on presentations. We use the Step 1 presentation brochure. If your prospect is not in the local area, send them a webinar invitation.

Anatomy of a Presentation

1) Get to know the people. Similar to a QI, spend the first 15 minutes getting to know your prospects. Ask them questions about themselves and LISTEN. They should be talking 90% of the time. This is one of the most important and easily overlooked parts of the meeting. Remember the saying – “people don’t care how much you know, until they know how much you care.” This will help them become more comfortable with you, and you may learn about their interests. Don’t worry if this cuts into your presentation time. It’s more important to build relationships. Even if you run out of time, they’ll want to get back with you if you made them feel good about themselves by talking about what’s important to them. When there’s a lull in the conversation, transition to the presentation. If you’re taking them to a workshop, these questions can be asked before and after the workshop.

2) Use the “Step 1” presentation brochure. This is the latest version of the presentation brochure that we all use. The best way to learn it is by watching your Business Support Team present one-on-one or at ICOs.

3) Cash Flow Quadrant. If this is a separate meeting from the QI, it’s important to review the Cash Flow Quadrant. It’s an effective and graphic way to educate on where we are and where we could be, using a book that was the Wall Street Journal’s # 1 bestseller. It helps to read Kiyosaki’s book “Rich Dad, Poor Dad.” The analogy of the “bucket carrier” (Employee) versus the “pipeline builder” (Business Owner), is a good way to summarize the concept in story form. Instead of metal pipelines that carry water, we build virtualpipelines that carry almost any type of goods and services. But both produce residual income and eliminate the need to carry buckets (have jobs).

4) Ways of Marketing. This section is also a review from the QI and can be covered quickly. The important points are that we have hundreds of thousands of products and services. They include thousands of brand name stores and manufacturers, but we are most excited about the products our company manufactures. We’re the #1 maker of branded food supplements in the world. We have the #2 selling energy drink. We’re the 3rd largest distributor of coffee in the US. We’re the 4th largest maker of cosmetic and skin care in the world (and we’re in the top five status brands). We’ve also have the largest online share of the Health and Beauty market for eight consecutive years (with almost half of all online sales).

5) Why This Business? Quick opening statistics are helpful to set the stage and create credibility. For example, use the brochure’s opening business statistic of over $800 million

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in growth last year to $9.2 Billion in sales across over 80 countries and territories, and we have been in business for over 50 years. See the Introduction section for more statistics.

6) The Dream or Reason. The single most important part of the presentation is to help them define a reason for pursuing this business. If this part is skipped, the chances of success are small. If there is no “why”, the “how” is irrelevant. There are many approaches to helping them define a reason or dream. You can ask them where they see themselves in five years or what they’d do if they won the lottery. Share your dream with them. If they like beaches or mountains, BMWs or boats, talk about that and ask questions. Help them define it. Let them talk about it as long as they wish. This is THE most critical part of the presentation.

7) Compensation Plan. Use the blank page to present the compensation plan. A finished example of the number is at the end of this chapter. Follow it up with the FTC average incomes on the next page. This section is best learned by watching during and ICO.

8) Community Development. This section helps explain that they will be in business for themselves but not by themselves. This is a great place to talk about your upline support team, the importance of CDs, books and attending functions – the System.

What It Costs to Get Started: It costs about $170 to get started. Most of this consists of products to try. Emphasize that the registration portion, $60, is refundable for three months and the product portion is 100% refundable for six-months.

Just like a carpenter needs tools, there are additional business building costs such as gas, prospecting materials and seminars. These expenses are discretionary and most are tax deductible.

Post Presentation: At the end of the presentation, determine if they are a “1” – ready to go, a “2” –interested but want more info, or a “3” – not interested.

1) If they’re a “1”: give them a 1st Night Pack (see below) and SCHEDULE A CONCRETE TIME TO GET BACK WITH THEM WITHIN 24 TO 48 HOURS

2) If they’re a “2”: also give them the pack and SCHEDULE A CONCRETE TIME TO GET BACK WITH THEM WITHIN 24 TO 48 HOURS.

3) If they’re a “3”: ask them if they would like to register as a Customer, which costs nothing. Also, ask if they know anyone who might be interested. Give them some sample products and schedule a time to set them up as a customer (they won’t make a first order on their own). Remember, all IBOs need a minimum of 50 PV in Customer volume each month to be eligible for downline bonus income. So we all need some “3”s for customers.

If they are a “1” or a “2,” cover the five steps on the back of the Step 1 brochure.

1) Read the literature, listen to the audiosTell them you need the CDs back within a day or two and to seek advice, but get it from those on the RIGHT side of the cash flow quadrant (the financially independent), not the LEFT (employees or self-employed who are in the same boat as they are). This includes

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friends, family and web sites. Review Chapter 9 on “Negative Web Sites” before presenting.

2) Schedule a Getting Started Meeting – Schedule a time to get back together to get more information if a “2”, or to get started if a “1”. This needs to be within 48 hours – most of us only retain 10% of what we’ve heard after two days. If a “1”, also schedule at least two appointments to do QIs with credible people in their cell phone.

3) Make two good lists – Give them a “homework assignment” to write down at least five things they want to have, do, or achieve before they die (bucket list). Start a written list of credible people. Start with 75 to 1000 names (average 35 year old knows 1000).

4) Learn more – Attend the next seminar and conference. All businesses require knowledge. This business arguably has the most effective training system in the world. Proof? We’re the largest non-government training organization in the world.

5) Use the Products – Test the quality. All the products and services are 100% refundable including shipping and handling. Several are ranked number one by consumer magazines

1st Night Pack (ROM 47): This is a CD with a regular audios recording, an mp3 audio and several pdf file brochures that can be listened to and viewed on any computer. If their car can’t play mp3 audios and/or they don’t have the computer skills to read a pdf file on their computer, use the nylon packs with written material and two standard audio CDs instead. If they’re not local, they can listen/view material online at www.interactivecommerceoverview.com/information.htm, currently the password is: crown (check upline, this may be changed in the future).

Ensuring a Follow Up: The mistake most of us make after a presentation, is not scheduling a CONCRETE time to get back together. We hear the prospect say, “we’ll listen to the CDs and get back to you.” It doesn’t happen. With no deadline – they won’t listen to the material. After 48 hours, they’ve forgotten the reason they were interested. Before you give a 1st Night Pack, or even a link to the online version, SET a time to get back with them within 24 to 48 hours. If your schedule prevents this, use your support team for follow up. If their schedule prevents it, set it up as soon as you can. Here’s a good approach.

“I’m sorry we’re a little short on material. We’ll need it back within a day or two. Will you be able to listen to the CDs by __________?” If they’re unsure, you can say: “Tell you what, since our schedule fills up quickly, let’s pencil in a time to swing by and switch out some more advanced material. If you check your schedule and it won’t work, give me a call and we’ll reschedule.”

This accomplishes three things. 1) It gives them a deadline to listen to the material. 2) It takes the pressure off of them. They realize you won’t require a decision next time you see them. 3) It creates a concrete time to get back together, and if they can’t, they must call you to reschedule. For those who are not local and are listening or viewing the material online, tell them that the password may be changed so they need to access the information in the next 24 or 48 hours.

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Compensation Plan

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6. FOLLOW THROUGH

The Follow Up/Strategy meeting after the initial presentation is usually THE most important meeting. Eighty-five percent of registrations occur during a follow up. Therefore, the primarypurpose of a presentation is simply to schedule a follow up within 48 hours. Every day beyond 48 hours, reduces the chance that they will retain the interest or excitement created during the initial presentation. They forget what they wanted out of this business. Without a reason, the business represents nothing but inconvenience. The follow up meetings continue until they make a decision. To help ensure a follow up meeting, review the end of Chapter 5, “Ensuring a Follow Up”.

What To Accomplish During a Follow Up Meeting:

1) The tendency is to go right into answering their questions. It’s important to get back to talking about THEIR REASON OR DREAM as soon as possible. If they mentioned they really wanted a log home, try to bring a log home magazine with you to the follow up. All businesses require time and effort. The question isn’t how much time or work will it require, it’s what would make it worth doing? Your job is not to convince but to make sure they understand the concept and its potential. Review Chapter 9 on “Negative Web Sites” before the presentation and follow up in case there are questions about sites they’ve hit or people they’ve talked to.

2) If they are still a “2” and want more information, give them additional CDs. Get these from your support team. If your prospect isn’t local, they can listen to more audios online at: www.interactivecommerceoverview.com/moreinformation.htm, password is meadows (check upline, this may change).

3) If they don’t have a names list, physically help them build one. Once you have some names, contact or help them contact to set up their first QIs. This is a critical step. They may not be ready to contact their people themselves. There are several ways to do this. The best approach for those under age 30 is usually to text, with you present to help them with questions. You can also have them call their contact on their phone and introduce you. The reason we use their phone is that today many people send a call to voicemail unless they recognize the caller. The next best approach is for them to dial the number on their phone and hand it to you. After watching you make a number of contacts, they are often ready to do it themselves. Regardless, the important thing is to set up enough QIs to get their business off the ground as soon as possible. Don’t leave your business to chance. It is the sponsor’s responsibility to get the new IBO started right including setting up presentations from their list. See Chapter 4 Contacting for referral contact scripts.

Registration Process – Registration can be done on-line at www.amway.com, or via telephone (800) 253-6500. If you don’t have fast computer access, it’s better to do it by phone or have them fill out the form, pay you and complete it later.

1. Registration Form: We’re used to skipping the “agreement” section of websites. They should read the “fine print.” Regardless, it’s important to highlight the following:

1) Point out that the IBO Plan states that the average IBO generates $202/month. To put that in perspective, the average US real estate agent makes about $70/month. Why? Many get their license – few actually do anything with it. We’re no different. This is a business; effort = results.

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2) The Business Support Materials Arbitration Agreement and IBO Plan state that Business Support Materials (audios, videos, books, etc.), and training seminars cannot be required. However, seminars are our school and business tools amplify our efforts just as power tools speed construction of a house.

3) Regardless of when they register, they need to know that all renewals occur in October (although they will remain IBOs in the system until 31 December). This makes it easier to remind everyone about renewal at the same time (June and July registrations costs are pro-rated).

2. Registration Cost: Provide a breakdown of the costs before registering.Registration Fee (varies slightly based on local tax rate) $60Registration Product Package (at registration) $100 (+ sales tax & shipping)New Business Owner pack (with Calendar and Notebook) $10 (may be paid by upline)

Total: $170 (about) 3. Product Intro Pack (40-1220): These products carry a six month 100% refund. If they question whether they need to purchase these items ask: “are you planning on building a business or doing this primarily as a consumer? As a consumer you should order whatever you want. As a business, we want to be familiar with the top products and have a demo capability. Ninety-two percent of IBOs who don’t purchase at registration, never pursue this.” Intro Pack purchase at registration is discounted 30%, carries double PV and qualifies them for up to $350 in additional bonuses.

4. New Business Owner “Getting Started” Pack: ($10) This package of business support material is part of the registration process and the new IBO pays the sponsoring IBO directly. The FY2011 cost is $10. The sponsor may pay for the pack for their downline if desired, but should never pay for the full registration. Give the new IBO a receipt for all tools and remind them to keep the receipt because business support materials are tax deductible. Review the contents with them.

• Contacting Cue Card – discuss contacting approaches• Calendar – go through each section• Cell Phone, Broadband, Satellite TV – explain PV/BV & the duplication impact• Free Facial Certificate – explain importance of product exposure• Survey – fill out to help set up Ditto Delivery profile• Copy of this IBO Notebook

5. IBO Orientation CD pack (new) AP093 A 4 CD set with steps to getting started Continuing Business Education (weekly audio and book of the month)

It’s critical to participate in Continuing Business Education in any field. Financial experts say the philosophy of the rich is exactly the opposite of the 95% … so many of us need to “unlearn” what we know about wealth. How do you teach a group of 100, 1,000 or 10,000 people to build a business? Most of us have never done it before. It requires new skills and to grow personally and professionally. The CDs, books and materials in our training system give you and your team “24/7” access to the wisdom and experience of hundreds of successful business leaders – the 5%. The creators of this program are IBOs who have already succeeded. They share what they did right, as well as their mistakes. There are only two ways to learn: by our mistakes or the mistakes of others. The system can grow and train you and your team. CDs and books should initially be loaned to the new IBO from the Top Audio List (Chapter 8). Eventually, business builders will need to have their own library to loan to their new IBOs. The weekly CD series is about half the cost of CDs in a book or music store. All business building materials carry a 180 day buy back policy. The audio and book list is updated annually. The current list can be found on the team website: www.enternet-i.com , user name: ibo, password: 833033x.

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7. REVIEW PROGRESS/STRATEGIZE

A critical part of any endeavor is to review progress and make corrections or changes as required. Your Dream or Purpose should be defined and in concrete. However, your plans to achieve that Dream or Purpose must be revisable. This is where our business system shines. We all have the ability to get help from and work with those who have already achieved what we wish to achieve. This is extremely rare in the business world. Generally, those who have achieved what we are attempting … are our competition. Even if they are willing to offer their advice, it’s usually at a very high cost. In our business system, our success is our upline Business Support Team’s success. They have a strong vested interest in us and will gladly advise us whenever we ask. The key word here is “ask.” Find a member of your upline Business Support Team that you can work with and who’s achieved what you are attempting, and use them. They can provide an objective view of your situation, just as they need to counsel upline themselves to get an objective view of their situation.

Below are a few strategies that will help you maintain focus and stay connected to your group.

• Every day make a list of actions needed and prioritize it. Then start at the top.• Draw your group out every day.• Listen to CDs every day and read at least 15 minutes a day.• Stay in touch with your people throughout the month, not just at the end.• Use the IBO Notebook with your new IBOs.• Strategize/Counsel with your upline Business Support Team frequently.

PRODUCT STRATEGY TO MAXIMIZE INCOME

Income comes from three sources:

1) The first is from items we purchase for personal consumption. In reality, this is a discount and rebate. Since our IBO cost for most items that Amway manufactures is about 30% below retail, we get an immediate 30% “discount.” In addition, if our total PV at the end of the month is at least 100 PV, we ALSO get a percentage back as a bonus check. For example, if we did 100 PV in personal purchases by the end of the month, we would get a check for 3% on what we purchased, or about $9. If we did 300 PV in personal volume, we would get 6% back on our purchases, or about $54. These discounts and rebates are nice ... but they aren’t business income and won’t make us financially independent.

2) The second source of income is retail profit. These are items that customers purchase, either by going to your website or by buying directly from you. This can be very lucrative with a 30% profit margin on most products. In other words, if someone buys $100 worth of stuff from your or your website, you make about $30 in profit. This income can be immediate and substantial. You also get the PV/BV on these purchases, which creates bonus income at the end of the month. For retail, it’s important to know which products have the best retail margin, PV/BV, and that you relate best to. You also need at least 50 PV in customer volume per month in order to get the third type of income, which is covered below.

3) The third source of income is from downline IBO volume. These are IBOs that have registered under you to build the business. This is the part of the business that can create the large, long term residual income. It has the ability to multiply your efforts beyond what you can accomplish by yourself and create financial independence. There is no retail profit from downline IBOs, but they have the capability to bring on other IBOs and customers that will make purchases that are part of your total PV and BV.

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Understanding PV and BV:

PV (Point Value) is the “score keeper” that determines what percentage you get paid at the end of the month. For example, if at the end of the month you have 100 PV running through your business, you would be eligible for a 3% bonus check. If you had 7500 PV running through your business, you would be at the 25% bonus level!

BV (Business Volume) is what that percentage is multiplied by to create your bonus. BV is similar to the IBO cost of an item (although it can be higher or lower). For example, if you are at the 3% bonus level, that 3% will be multiplied by your total BV to create your bonus. BV is usually about three times the PV on the products Amway manufactures. So, if you have 100 PV in volume, you would have about $300 in BV, and your bonus would be 3% of $300, or $9.

Maximizing your PV/BV:

In order to maximize income we need to know which products have the best PV and BV to cost. All products are not equal. The highest PV/BV products are those that Amway manufactures. The lowest are from Partner stores such as Sears, Office Depot or Barnes and Noble. However, Partner stores have different percentages from 14% to 64% BV. Percentages can be found under the “A to Z List” under “Partner Stores & Services.” If you’re going to buy appliances, books, office supplies, etc., it would be crazy not to check out these store’s first, to see if they have what you need at a good price ... even a small percentage back is better than none.

Among the Amway products, there are also differences in PV/BV. The products with the best PV/BV to cost, are in the Health and Beauty category, such as vitamins, skin care and cosmetics. Below is an example comparison of similarly priced items from the high PV/BV category, medium category PV/BV and from a partner store:

High PV/BV item: Double X Multivitamin (30 day supply)Suggested Retail: $76.90IBO Cost: $49.99 If your customer buys, retail profit = $26.91BV: $63.98 Your bonus if you’re at 25% level = $16.00PV: 22.06 Your final cost after bonus = $33.99

Medium PV/BV item: 3 cases of XS Energy Drink (36 cans)Suggested Retail: $80.64IBO Cost: $68.78 If your customer buys, retail profit = $11.86BV: $68.78 Your bonus if you’re at 25% level = $17.20PV: 23.76 Your final cost after bonus = $51.58

Low PV/BV item: Partner Store product (Office Depot Double HP Inkjet Cartridge pack)Retail: $78.75IBO Cost: $78.75 If your customer buys, retail profit = $0BV: $23.62 Your bonus if you’re at 25% level = $5.91PV: 9.85 Your final cost after bonus = $72.84

Double X has the highest retail profit, BV, PV, and the greatest savings. XS Energy Drinks and the cleaning products are the next best. Products from Office Depot are the lowest, but still better than if you bought them directly from Office Depot or their website. All of these would be intelligent purchases but some products are better from a business standpoint. Savings are important, but imagine your downline IBOs and customers all using Double X vitamins. Obviously, the first step in promoting any product is using it ourselves.

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Required 50 PV in Customer Volume: To earn income on your downline IBO volume requires at least 50 PV per month in customer volume. This requirement is driven by the FTC. If you have a registered customer with their own customer number, their PV is automatically tracked and reported every time they make a purchase. You can see it on the PV/BV Inquiry page. You can also manually enter sales made directly by you to a customer using the CSA (Customer Sales Activity) page under “Manage My Business,” but the products must be shipped to their address to get credit for your monthly 50 PV. The 50 PV in customer volume is not required to receive bonus income on your personal purchases.

Volume/PV Development

1. Use the Product Intro Pack products for refreshments at business meetings. 2. Do a Grand Opening for new IBOs to build their customer base for income and bonuses.3. Use the “Ditto Delivery Survey” to help people use the Ditto Delivery program.4. Check out the satellite TV or cell phone plans for up to 125 PV/BV. 5. Do facials with the skin care products & the Skin Analysis Machine within the first 30 days.

The single most important factor in developing volume in your group is duplication. The question we must all ask ourselves is – do we want our downline IBOs duplicating our purchasing patterns? No matter how many IBOs we register, if there is no volume, there is no profit. No matter what we say, our downline team will duplicate what we do. Saving a few dollars by buying from a local discount store instead of from ourselves, can be extremely expensive in the long run. If our team duplicates what we do, that several dollar savings could cost us hundreds or thousands of dollars a year in lost bonuses. Talk to your active upline or Platinum for more information on how to develop volume and PV in your team.

Ditto Delivery is the “heart” of this business. Here, we refer to the “heart” as an organ that pumps blood through our bodies without conscious thought. Ditto is simply an automated shopping list. It allows IBOs and customers to put any items they use more than once, on the electronic list. Then they have complete control over whether an item on that list is delivered once a month, once a year, any thing in between, or never. It not only saves time and prevents you from running out of everyday items; it massively accelerates your business. IBOs on Ditto Delivery run over 3 TIMES the volume (PV/BV) of IBOs without Ditto. That means fewer IBOs, contacts, etc., to achieve the same income! Scheduling it on the first of the month is important. It’s very motivating for you, and your team, to have most of the PV appear at the beginning of the month. It also helps you and your IBOs plan for the rest of the month. Of course, our teams duplicate us.

Fast Track Program: This program is designed to accelerate business growth in the first six months by giving additional bonuses. It also helps ensure that IBOs set up their 50 PV in customer volume early on. The Fast Track program pays three additional $50 bonuses per month (during an IBOs first six months in business). They just need to have 150 PV of total volume, of which at least 50 PV is customer volume. If they go on to help three other IBOs they’ve registered achieve thatsame $50 bonus, they also get a onetime $300 bonus. Then, if any of their IBOs in depth do the same thing, they get $75 for each occurrence, and if they have three that do this, they get an additional $500 bonus. Total Fast Track bonuses can exceed $1175 not including PV or retail bonuses. See the Fast Track brochure for details.

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8. REPEAT PATTERN (LEARN, DO, TEACH)

The 8th Step is really repeating the 7 previous steps with your new IBOs. We learn the process; we do it ourselves, and then teach it to our new people. The key is learning from those that have gone before us. The tendency is to want to reinvent the wheel, or pick and choose the principles, techniques or tools that we prefer. Like McDonald’s, we have a proven System and leaders with decades of experience. Never hesitate to ask why a particular principle or technique is used. Remember, we can only help people achieve the level that we have achieved. That’s where the Business Support Materials come in. They allow us to learn from people at higher levels. Your sponsor, Platinum, etc., would prefer you learn how to do something from a Diamond, rather than from them. However, your upline knows you and can help identify which tools might be most helpful for your background, personality and situation. Initially, your upline will loan you materials. Participating in the Continuing Business Education program (CD of the week and book of the month), allows you to build your library of business “tools” to share with your new IBOs. Ultimately in any business, whoever owns the tools owns the business. Below are some powerful CDs. Check the team website for the current top list: www.enternet-i.com user: ibo, password: 833033x.

TOP AUDIOS (most can be purchased from ibocentral.com; check with your team)

Stock # Title Speaker1. CD 500 Your Next Move Various2. CD 765 Designed to Be Free: It’s Your Life Kopecky3. CD 374 Where Business is Headed Argyris4. CD 214 Why This Idea Will Work Meadows5. CD 395 Take Control of Your Life Kiyosaki/Smith6. CD 320 Strangest Secret Nightengale7. CD 588 There’s A Platinum In Every Cell Phone McGrath8. CD 595 Let’s Go Diamond Winters9. CD 109 This Is Diamond Halsey10. CD 271 Financial Freedom Gulick11. CD 268 100 Reasons Why DeVries12. CD 273 Mining For Platinum D. Smith13. CD 036 Act Like Your Dream Gorman14. CD 118 It’s Not Over ‘Til I Win Brown15.CD 287 Oh Harry! Mainor16. CD 333 Early To Bed Courtney17. CD 360 Rich Plan Poor Plan Kiyosaki

TOP BOOKS

1. BK66 Magic Of Thinking Big2. BK30 How To Win Friends And Influence People3. CBK10 Don’t Let Anybody Steal Your Dream4. BK245 Skill With People5. BK1 Acres Of Diamonds6. CBK37 Hung By The Tongue7. BK72 Think & Grow Rich8. BK120 The Go Getter9. BK58 Power Of Positive Thinking10. BK430 Love Languages11. BK271 Richest Man In Babylon12. BK408 Positive Personality Profile

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9. FREQUENTLY ASKED QUESTIONS

1) Business, Legal and Tax References

Our Team Website is www.Enternet-I.com, user name: ibo, access code # 833033x. This sitehas upcoming events, announcements, downloads, website links and business building information. As changes occur, this IBO Notebook will also be updated on this site. To see if you have the most current version, check the date on the bottom of the table of contents page and compare to the date on the web site under “Downloads.” This Notebook can be updated, or downloaded in its entirety.

Business Forms and References: All Amway business forms and references can be viewed or

downloaded from the Amway website under Manage My Business/Business Resources. The 100page Business Reference Guide can also be downloaded, and explains, with examples, the

Compensation Plan, Leadership and Depth Bonuses, and IBO Rules of Conduct.

Tax Information: Detailed tax information, including local sales tax and adjustment forms, can be accessed on the Amway site. Amway automatically charges sales tax on the retail price, even if the product is purchased by an IBO for personal consumption. The one page tax adjustment form allows IBOs to recoup the sales tax difference any time during the year. Go to Manage My Business. For Income Tax and other helpful information, go to our Industry Association website www.iboai.com and download “IBO Bookkeeping 101.”

Amway Growth Incentives: The current Growth Incentive program, beyond the basic Compensation Plan (25%), Leadership Bonus (4%) and Depth Bonus (1%), can be found on the Amway website. Go to Manage My Business > Compensation, Incentives, Rewards and Recognition. This area will provide the current fiscal year program for bonuses such as the $2500 Platinum bonus and $15,000 to $20,000 Q12 Founders Platinum bonus, as well as Emerald and Diamond bonuses and growth incentives. For details and examples of the basic Compensation Plan, go to the Business Reference Guide (see above). Amway average incomes are below.

Founders Platinum $51,457Founders Emerald $124,697Founders Diamond $363,096Founders EDC + $880,942

Amway Contact Number

All Functions (800) 253-6500 M-F 7:00 AM – Midnight ESTSat 8:30 AM – 5:00 PM EST

Upline Contact Numbers

Sponsor ________________ cell:_______________ Home: ________________ Platinum ________________ cell:_______________ Home: ________________ Emerald ________________ cell:_______________ Home: ________________

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2) Negative Web Sites

According to The Rocky Mountain Free Press, there are hundreds of thousands of web sites attacking just about everything. All the Fortune 500 companies are represented, as is every religion and most celebrities. It’s almost impossible to successfully prosecute a libel lawsuit on the Internet. Most of us come across negative sites by accident. I went looking for them to support a graduate term paper. Amway looked “too good to be true.” I contacted web site authors to get more information.

1) These sites often compare this business with a job, rather than another business. If we talk about a paycheck after two weeks, a job will win over any business. Interestingly, none of the site authors contacted,had EVER had a business. Here is a quote from one site, “This is the MLM I experienced. Not fully, as I was more observer than active "distributor". …” Amazingly, he admits he never attempted it, but is happy to explain why it won’t work. Amway is a business, and must be compared with other businesses. Not all businesses succeed, but we don’t risk tens of thousands in capital as a conventional business does. The reason people pursue a business is that the chance of becoming financially independent as an employee is statistically about the same as getting struck by lightning. With a business it’s almost 1000 times greater.

2) Claim: "Only a few people at the top make a lot of money with a network business." First, let's define ... "few." Fortune Magazine said the network marketing industry produced one quarter of all millionaires of the last decade! That’s a big “few.” Amway is the most successful MLM, with almost $3 Billion in distributed profits. In 2011, over 800 IBOs achieved the Platinum level for the first time in North America alone (average Founders Platinum income over $50,000). What these sites are really saying is: themajority of people who register will not succeed ... therefore, YOU shouldn't try. The first half is correct. Most who “register" with Amway will never start (they probably won’t be reading this). But, this is true of everything in life. Eighty percent of college graduates never work in their field of study. If we decided not to try anything that wasn’t a sure thing ... we'd still be living in caves.

3) Some sites try to back up their claims with statistics. A statistic can be correct but useless. The average income for a licensed real estate agent in the US is a little over $50/month. This is a true, but are there any real estate agents who make a living off of real estate? By the negative web site’s philosophy, Real Estate is a scam because not everyone succeeds. Amway publishes average earnings per IBO of $202 per month. The majority of people who get their real estate license, or register with Amway, won’t pursue either. One site quotes – “the majority of those who register with an MLM will never register another.” This is accurate, but let’s dig deeper. The vast majority won’t contact more than four people! Why do so many do so little? Aside from believing in negative web sites, it’s probably because they’re comfortable. Is this bad? No, almost no one asks for a registration refund. They're honest and know they didn’t give it a fair shot. Very few quit and try to justify their inaction. One way to do this … is to create a negative web site.

4) Another claim is that people are getting rich off the training material. To be fair, there have been pyramid schemes that made their money that way. They don’t exist long because they collapse or the FTC shuts them down. We are extremely open in the cost breakdown of training materials. Read "Business Support Material - The Financial Side," page 32. This gives a summary of BSM cost and margins. The system mimics Amway product distribution. Amway is rigid in enforcing the Rules of Conduct. If an IBO violates the rules, Amway can and has terminated IBOs at the highest levels. These very rare actions and lawsuits are often trumpeted by negative web sites as indications of a poor business. It’s just the opposite. We police ourselves. The real question is simply – are the business support materials worth the price? CDs are about half of what a bookstore charges, but if we don’t think they’re worth it; we don’t have to buy them. We also have a 180-day buy back policy for all tools!

5) Ultimately, authors of negative web sites usually had a conflict with their upline. People don’t create elaborate sites to debate the pros and cons of a business they didn’t pursue. It almost always comes down to a personal conflict, and an “I’ll get revenge” attitude. It’s certainly possible that they were the injured party. They may have had a sponsor or upline that didn’t support them. Bottom line, if we can’t work with our upline, we can go further upline. If someone really a “bad apple,” and it can happen like any business, one of two things will occur. They’ll grow and get better, or fail and quit. It’s impossible to sustain a network of people … if they don’t trust you. The system is self-correcting.

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In summary, we recommend people do their research on Amway, but from accredited sources: Federal Trade Commission, State Attorney General’s Office, Better Business Bureau, etc. If someone is going to accept information from unaccredited sites, they should know what their qualifications and sources are, and what their motivation is. That means contacting the site author directly. If you cannot reach the author andverify their sources, beware. If you can reach them, here are a few critical questions to ask. 1) Do you currently or have you ever owned another business? 2) Did you actually participate in this business and if so how long? 3) How did you get along with your sponsor/active upline? 4) What is the source of any data presented? 5) How is your website funded? If at the end of the negative website, you find a promotion for another “better business” … you’ve just discovered the motive behind the site. The Internet is an amazing source of information but it’s also a giant bathroom stall wall.

Above all else, we should ask ourselves this. Is the person or web site offering advice about this business on the Left or Right side of Kiyosaki’s “Cash Flow Quadrant?” In other words, have they achieved what you want to achieve? Why should we take financial advice from someone who hasn’t succeeded financially, whether it’s a website or our brother-in-law? If we take the advice of the 95% on the left side, we will stay with the 95%.

Business reference websites: www.thisbiznow.com; www.AmwayGlobal.facts.com; www.IBOAI.com; www.ftc.gov; www.ibofacts.com; www.bbb.org

3) What About Prices?

Early in the business, I did a price comparison of 15 sample products: mouth wash, laundry detergent, kitchen cleaner, paper towels, light bulbs, batteries, etc., and compared them to Wal-Mart (the largest retailer in the world). I had to calculate cost per use on each product so that a head-to-head price comparison could be made. This was important since some of our products are concentrated or have a longer life. I found that on a cost-per-use basis, some of our products were less expensive (some significantly), some (like batteries) were identical, and some were more expensive. When averaged together, we came out about the same as Wal-Mart. Shipping adds a little more. However, we either pay shipping, or we ARE shipping. Forgetting about what our time is worth, how much does it cost in gas to drive to our local stores?

Let's take the price question head on. Some argue that they only purchase what they need at the lowest price. My response in most cases is ... really? Anyone who has ever run their car through a car wash, or had someone change their oil or used a dry cleaner can’t say this. Anyone who has bought anything at a convenience store can't say that either. When we do these things, we’re buying convenience (time). There are no higher priced items in the world than in a convenience store but it may the save time of going to a big grocery store. One of this business's primary consumer benefits is convenience. Despite that, many of our consumables are still cheaper than Wal-Mart. On top of that, we have a six month refund policy. Try that at Wal-Mart.

The most compelling argument from a consumer standpoint. When we buy our consumables through Amway, we reduce our time at retail and grocery stores. Retailers say that two-thirds of all American purchases are impulse buys! We can’t speak for others but we were surprised. We tracked our consumable expenses before and after entering this business, and found that we actually spent $130 less per month. I thought it was a mistake because the products are similar in price. Then I realized the $130 we saved was simply impulse buys we didn’t make. Everybody is different, but if you doubt that you do any impulse buying, try the following. Next time you return from the grocery store, take each item out of the bags and classify them. Did you need this item? Did you actually go to the store to get it, or did you see it and buy it? When you total the price of the extra items, you may be surprised. Our business model can slash these purchases because it reduces our shopping trips, and the time in the grocery store when we do go.

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Examine this from the Business side. All the previous discussions are from the consumer standpoint. Now, let's take a look from the most important perspective – THE REASON MOST OF US REGISTERED. If you are considering this as a Business, then it’s a vehicle to achieve income or financial independence. For business builders, our purpose is not to convert ourselves or others to use XS or SA-8 Laundry Detergent. We're happy if people like it, or it makes their life easier but that’s not the goal. People often say – the consumer side is important for this vehicle to work. That’s absolutely true, but it IS working. It's working to the tune of ten BILLION a year. People want high quality products and convenience. If they didn't, we wouldn't be exploding and there would be no market for fast food, conveniences stores or car washes. Whether you or I buy consumables online or not, this model is working, and it’s working at a fantastic pace.

Let's look at the business case. Would we decide NOT to buy a McDonald's because we think the French fries are too salty or are more expensive than Burger Kings? Of course not – we would be considering McDonald’s as a business. We would look at their success record, and even if we hate French fries that wouldn’t impact our decision ($455,000 for a minimum franchise, by the way). If you own a Chevy dealership you're not going to be caught dead in a Ford Mustang, even if you like them and think they’re a great value. The same thing applies to our business. We often get hung up on a favorite brand name or worry about saving pennies … at the expense of earning thousands. I have to smile when I say this, because I did the exact same thing. I got hung up on paying more for cat food. From the current perspective of a four digit monthly income, it’s amusing. This compensation plan may have made more people financially independent than any company in history. I like our brand of toothpaste, but to be honest, even if I didn’t, I’d still use it. Why? Because it allows me to brush my teeth at 10:00 in the morning … instead of 6:00. Don't let a bag of cat food or a tube of toothpaste stop you. Where could you be in three to five years, if you build this? Where will you be in three to five years if you don't?

4) Business Support Materials – The Financial Side

Education and motivation are the keys to success in any business. The better we know "how" and "why", the faster we will grow. With training and motivation there are a few simple basics that work universally and are the basis for every school in the world. They are classrooms and textbooks. Or in the business world, they’re called audios, books, seminars and conferences. Many ask how we’ve become the most successful network business in the world? We have a proven system. The financial side of Business Support Materials closely follows Amway’s products andservices financial plan.

Amway Product & Services Financial PlanI. Approximately 35%

II. Approximately 33%

III. Approx. 35% (Actual Production Cost)

IBO DiscountFrom Manufacturer’sSuggested Retail Price (Customer Price)

Volume Discount3% - 25% PV –Bonus4% - Leadership1% - Depth, etc.

• Manufacturing • Research/Develop.• Warehousing

• Computer Networks

• Administration• Royalties

• Corporate Profit

A. BUSSINESS SUPPORT MATERIALSBusiness Support Materials range from literature, CDs, DVDs, etc. Most of the books/literature carry little margin, so we will use CDs for our example. Most business CDs from professional

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motivational speakers such as Zig Ziglar, Les Brown and others, have a suggested retail from $12.00 - $25.00 each. Ours cost about $7 plus tax and shipping if applicable.

BSM Cost BreakdownI. Approximately 35%

II. Approximately 30%

III. Approximately 35% *

IBO DiscountMSRP on CDs is $11. Our discount price is about $7 for CDs + tax and S&H (FY 2006 prices).

Volume DiscountThis additional discount is based on volume. This is intended to offset BSM distribution costs.

• Manufacturing• Royalties• License• Research• Legal Review

• Advertising• Warehousing• Shipping • Speaker

Honorarium• Corporate Profit

* The vendor or supplier produces distribution ready, legally reviewed material

B. SPEAKER HONORARIUMS In addition to the above example, honorariums are paid to speakers at Business Development Seminars and conferences commensurate to the speaker's pin level, organization size, and speaking ability. Hopefully, your goal will be to become a good communicator, and develop a large organization and pin level, however, there are no guarantees concerning speaking engagements.

C. PERSONAL DEVELOPMENT PROGRAMSSeminars and motivational meetings provide FACE-TO-FACE contact with your upline and other popular speakers. It is a time for you to experience the "real people" side of the business instead of just listening on CD. Ticket prices for seminars similar to ours in the normal business environment cost several hundred dollars to over a thousand for weekend conferences. Most importantly, other business seminars have NO FOLLOW-UP with their participants after the seminar. Our meetings, sponsored by your upline and/or Internet Services, are the best buy for your dollar of any part of our Personal Development Program. The ticket price ranges from a few dollars for ICO workshops meetings, to local seminars ($15-$20), up to around $135 for a 3-day weekend seminar (not including hotel & food). Your meeting fees pay for the cost associated with the function (facility, speaker honorariums, etc.). Those who haven’t attended a professional conference may question costs. We suggest they call a hotel conference center and a professional speaker and ask how much they charge.

5) Amway Versus Other Businesses

A recent survey indicated that 83% of Americans have seriously considered owning their own business. Yet, less than 10% attempt it – why? The most common reasons cited are: lack of money, time and knowledge. The majority of all small businesses in the U.S. fail within five years. Franchises offer a higher success rate, but they have steep franchise fees and start-up costs (a basic McDonald’s franchise is $455,000). Additionally, self-employed people in the US work an average of 70 hours a week. Why would anyone consider a business of their own? Because ... the probability of becoming financially independent as an employee is almost zero. The chances of achieving financial independence with a business, while still small, are almost 1000 times greater.

The Amway Model

The Amway model took the best aspects of old business models (wholesale, direct sales, mail order, franchising, network marketing, Super-Stores, Super Malls) and combined them with the newest business model, E-commerce to form a streamlined hybrid called Interactive Commerce or I-Commerce.

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Amway is the intersection of four major business models or trends. The 1950s brought Franchising by companies such as McDonald’s. This revolutionized the restaurant industry. The 1970s brought the concept of the Super Mall. It allowed the consumer to shop from multiple specialty stores in one weather protected location. The 1980s evolved the Super Mall into the Super Store. The best example is Wal-Mart, currently the largest employer in the U.S. The Super Stores provide large product selection in one giant store at very low prices. The 1990s brought the Internet and e-commerce, creating the ability to shop interactively from home. What happens if you combine all four of these models? It’s called Amway. Amway is a Super-Store that has everything from cosmetics to computers, detergents to desks, food supplements to fax machines. Amway has more partner stores than the largest brick and mortar Super Mall. Add the Internet. Being able to access millions of products and services on-line is a powerful concept, but it isn’t enough to guarantee success as many Internet companies have discovered. The final ingredient that turns this into a revolutionary concept, and one of the highest grossing retail sites in the world, is the addition of the franchise model. This allows the consumer to participate in the profits. When the franchise model is then also “re-franchisable”, it creates the ability to generate unlimited residual income. Welcome to Amway.

Why It Works

With all the e-commerce companies out there, what makes us different? Over 1000 “dot com” companies have failed. The problem is that they have attempted to use a “brick and mortar” business model on the Internet. Many mechanisms that work beautifully for traditional retailers like Wal-Mart or McDonalds, don’t work on the Internet. For example:

• The most important factor in real estate is location. A store’s location in the “brick and mortar” world can mean the difference between success and failure. This is irrelevant on the Internet – all Internet stores are the same “distance” (mouse clicks) from every customer.

• A powerful retail tool that has been around for years is the “Sale.” Retailers sacrifice a few items at little or no profit (“loss leaders”) to pull people into their store. Once in the store, they count on impulse buys. On the Internet, a few mouse clicks takes the consumer to another store with another sale. It’s impossible to keep a customer “inside” the store to encourage impulse buying. Nor can they drag customers by aisles of merchandise by putting the most popular items in the back of the store (milk in a grocery store).

The answer is a new business model designed for the Internet. The missing factor, e-commerce companies are searching for, is how to sustain customer loyalty on the Internet. Michael Dell of Dell Computers said that whoever figures out “community”, will dominate the Internet. The answer is to create a community of “prosumers”, consumers who share in the profits. Independent Business Owners create links from the Producers to the Consumers, and keep the middleman profit with none of the headaches or overhead of current distribution systems. Sam Walton built an empire by developing a simpler more effective means of distributing products that people were already using. Our system takes it to the next level by eliminating the retail store.

How Well Is It Working?

Amway is one of the fastest growing billion dollar companies in the world and the 32nd largest privately held company. Globally we did over $10 Billion returning almost $3 Billion in distributed profit. That puts us in the top 500 largest companies in the world! We’re the largest maker of branded vitamins and have the 2nd biggest selling energy drink in the world, etc. It’s working.

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The FutureThe market for our type of consumer products is over one Trillion dollars ($1,000,000,000,000). Amway has about one one-thousandth of the total retail market in the U.S. The U.S. Secretary of Commerce predicted by 2015, half of all retail sales will move to the Internet. This business model allows us to ride the wave instead of just being the consumers who fuel it.

The ChallengeWe encourage comparison. Choose any business in any industry: restaurant franchise, real estate, or any business model. Use the criteria in the following chart or create your own. Choose any evaluation system to rank this business model against the alternatives.

Business Evaluation Worksheet

Business Evaluation Criteria Amway Business A Business BAccounts Payable/Receivable None

Active Versus Residual Income Both

Administrative Paperwork Required Very Low

Age/Physical Limitations None

Compensation Program Stability High (participatory)

Consumables or Durable Goods Both

Delivery System & Infrastructure In Place (world class)

Employee Requirement None

Federal Trade Commission Approval All 50 States

Financial Stability Debt Free Company

Geographic/Territorial Limitations None

Income Ceiling None

Income Transferable to Heirs Yes

Internet Enabled Fully

Ethical & Moral Products/Services Yes

Ecologically friendly products Yes

Operating Hour Flexibility No fixed schedule

Operating Time Requirements 5-15hours/week

Vacation Incentive Programs Yes

Performance During Inflation Good (indexed to prices)

Performance During Recession Good (basic necessities)

Product Guarantee 100% for 180 days

Product Market Over 80 countries

Product Scope over 500,000

Product/Services Liability Extremely Limited

Products or Services Both

Quality of Products/Services Top Ranked

Recurring/Overhead Costs Very low

Retail or Wholesale Both

Seasonal Business No

Start-up Cost ~$170

Track Record of Business Concept 52 Years

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Glossary of Terms

Business Development Seminar (BDS) – monthly business training seminars – our school.

Business Support Team: (BST) Your active upline Independent Business Owners (IBOs) in your Line of Sponsorship. They are responsible for supporting you and your team.

Continuing Business Education (CBE): Standing order weekly audios and monthly books.

Counseling: Regular business strategy sessions with your active upline – usually a Platinum or above in your Business Support Team.

Crossline: Any IBO who is not in your direct upline or downline line of sponsorship. Asking or offering business advice to a crossline IBO is strongly discouraged. It usually results in confusion and often in unintentional damage to your or their business. Crossline IBOs offering advice have good intentions but do not have an in-depth understanding or vested interest in the other’s team.

Depth: Any IBO registered under one of your personally sponsored IBOs. Developing depth – is the key to long term security in this business. The goal is twenty deep in each leg.

Downline: Also referred to as “Team” – IBOs personally sponsored and in Depth in your team.

Edification: Sharing positive characteristics of your upline and downline. Edification of your Downline IBOs in front of their team, builds confidence in them and their IBOs. Upline edification allows your BST (upline) to work effectively with your team when you are not available.

Fast Track: Program for new IBOs that offers hundred in additional bonuses for the first 3 months.

ICO: Interactive Commerce Overview (workshop), a group presentation of the full business plan.

Leg: Every personally sponsored IBO and their team is a “leg”. This business is most profitable and works best when we build depth in at least 9 personally sponsored legs.

Line of Sponsorship (LOS): All IBOs who are linked by registration, from those who you’ve sponsored downline, up through your sponsor and on up to your upline Diamond and above.

PV/BV: Amway’s system of Point Value (PV) and Business Volume (BV). It is the inflation protector in the business plan. Each month the PV accumulates and qualifies you for a performance bonus level, which determines the percentage to be paid on your BV.

Upline: Also called your “Business Support Team”. This includes your sponsor and any IBOs above them in your Line of Sponsorship up through Dexter Yager.

Width: Your personally sponsored IBOs. Width – is the key to profitability in this business.

3 in 30 Sponsor 3 IBOs in width or 2 + 1, 1 + 2, or 1 + 1 + 1, in a 30 day period300 Pacer 300 PV from personal use and customer volumePace Setter IBOs on CBE (weekly audios) and attending BDS’s and Conferences Go-Getter IBOs who do 15 plans or get 15 prospects to ICOs, or any combination in 30 daysFast Track IBOs who do 50/150 in PV and sponsor 3 personal IBOs who do the sameEagle On CBE, 100 personal PV, and 15 IBOs (across 3 legs) attending functionsDouble Eagle On CBE, 100 personal PV, and 30 IBOs (across 6 legs) attending functionsUltimate Eagle On CBE, 100 personal PV, and 45 IBOs (across 9 legs) attending functionsSilver IBO who has attained 7500 PV for at least 1 monthPlatinum IBO who has attained 7500 PV for at least 6 months in a fiscal year Ruby IBO who has attained 15,000 PV outside a Silver or Platinum legEmerald IBO who has 3 qualified Platinum legs in the fiscal yearDiamond IBO who has 6 qualified Platinum legs in the fiscal year