Amway, Is it the greatest con game since the shell game?
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rate.
Distributor retention is vital to the success of any MLM endeavor, because you have to be able to sponsor new people faster than the old ones quit. In the landmark FTC decision of 1979, Amway testified to a 50% retention rate, which was excellent for the direct sales industry. This means that, in any given year, 50% of the distributor force quits. Anyone wanting to succeed at sponsoring would have to sponsor two for every one they want to keep.
So (according to the complaint), instead of an average attrition rate of only 5.5% per year, as they had been led to believe, the Holtons discovered that the annual dropout rate was really 66% per year — an enormous difference. Kim Holton, who had sponsored people she cared about, was thrown into a serious depression and eventually committed suicide, leaving her husband and son.
PROSTEP LEAD MLM
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