MYTH: Saturation

This concept is hypothetically possible but in practice has not been shown to be the case with companies such as Amway. In short, it states that according to the rules of geometric growth, the market will be completely saturated with product.

Example

In 2000, according to the 2000 Census Indiana had 2,336,306 households. In theory, each of these could form an independent business. To take into account required retail sales (50 pv a month) to qualify for bonuses on downline volume, this could yield 1,168,153 Independent Business Owners. According to the 6-4-2 plan approved in 1999, this would yield 14,786 Platinum qualifiers, each of which would add between $50-60K to their family income (ncluding the $20,000 Q12 bonus). At this point, no new growth is possible in Indiana; 100% of households are either IBOs or customers. Those who have not reached Platinum level never will, until household fission and population growth yields new households.

Now, numbers have been suggested by long-time distributors that only 30% of the population is at any given time willing to consider a business such as this, which shrinks the pool of households available to this calculation to a much smaller number; however, it has also been observed that many people who decline the opportunity once will often reconsider in the future.

Reality-based Observations

In actuality, over the course of 50 years market saturation has not been a problem for Amway Global. Its products have achieved little name recognition among most consumers in the US, although the Amway name itself may be wider-known. There are several reasons why market saturation has not been reached: