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Amway is a supplier of various household products that are
sold by distributors through direct marketing. Distributors
purchase the products for personal use, as well as for resale to
customers and downline distributors. Distributors are encouraged
to recruit others to become downline distributors. The Amway
system is based on an upline-downline system whereby a
distributor's direct and indirect sales are rewarded with
bonuses. In addition to a percentage of his own sales volume, an
Amway distributor may earn income by recruiting others to join
Amway as distributors. The original Amway distributor is called
an "upline" distributor in relation to his new recruit, the
"downline" distributor. The upline distributor receives a
percentage of the sales achieved by the downline distributors in
his "chain of distribution" even though the upliner does not
participate in their sales. If a downline distributor recruits
another individual to be his downline distributor, the upline
distributor takes a percentage of the sales of both downline
distributors, even though the upliner has nothing to do with the
activities of the new downline distributor. Thus, to maximize
Amway-related income, the distributor sells the Amway products
and tries to enlist others as downline distributors.
Amway does not have a quota for sales, its products do not
have to be sold above cost, and its distributors are not required
to sponsor downline distributors. An Amway brochure, The Amway
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Last modified: May 25, 2011