The
AMWAY Sales & Marketing Plan utilises a combination of numbers
to calculate its rewards and commissions. In this article we will
define these sets of numbers that are utilised and also discuss the
term, "personal volume" and how it contributes to the profitability
of the business.
The AMWAY Sales and Marketing plan utilises four sets of numbers -
IBO/Member Price - Retail Price - Point Value (PV) - Business Volume
(BV). All product and services that are transacted through your business
are assigned these four sets of numbers,
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IBO/Member
price is the amount IBO's and Members pay for their Amway
product. |
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Retail
price is the wholesale price plus a retail margin |
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Point
Value (PV), is a unit amount assigned to each product and is
referred to as an effort index. Each month the PV is totalled
in order to determine the Performance Commission percentage
level. |
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Business
Volume (BV) is a monetary figure assigned to each product. In
order to calculate the monthly commission, the percentage level
is determined by the total PV, which is applied to the total
monthly BV that has been accumulated. (currently the ratio between
PV & BV in this market is 1 PV : 12.55 BV) |
Your business is based on the monthly accumulation of points - PV
& BV. Based on the total of PV accumulated, IBO's utilise
the following Performance Commission schedule to calculate their rewards;
| PERFORMANCE
COMMISSION SCHEDULE |
If
your total
monthly PV is:
| |
Your
performance commission
is calculated at: |
| 10
000 |
|
21%
of your BV |
| 7
000 |
|
18%
of your BV |
| 4
000 |
|
15%
of your BV |
| 2
400 |
|
12%
of your BV |
| 1
200 |
|
9%
of your BV
|
| 600 |
|
6%
of your BV |
| 200 |
|
3%
of your BV |
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Each
time an IBO places an order for AMWAY products, these four sets of
number are ultilised. The PV and BV is recorded in each transaction
against an individual IBO number this is referred to as "Personal
Volume," which includes retail sales of product to retail customers,
samples used in the development and demonstration of their business
and product used for personal consumption.
A simple example of this calculation would be if an IBO purchased
200PV of product in a month, then the Performance commission would
be calculated in the following way; 200PV x 12.55 = 2510 BV. At 200PV
this IBO is entitled to a 3% rebate (utilising the Performance Commission
Schedule) of their BV i.e. 2510BV x 3% = R75.30, which is automatically
paid into the IBO's bank account.
In our next article we will show you how to expand your business by
introducing others and how to calculate the differential commission.
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