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    Amway / Quixtar's Finest Fake News Source           Feb 2000

92% - 97% of Amway Distributors Are out of Business in Five Years
Ada, Michigan (APP)  The Amway website announced that just over 50% of distributors renew each year.   Amway distributors across the world were shocked to learn that their business actually has the same or higher failure rates than the rumored failure rates spread by Amway distributors about traditional businesses.   Amway distributors claim that 90-95% of traditional business start ups fail in the first 5 years.  

With this renewal rate information, straight from Amway itself, Amway Parody Press wanted to compare the rumored success rate of traditional businesses with Amway's success rate.

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Amway Parody Press's Doctor of Mathematics

 

 Amway Parody Press mathematicians worked furiously to find the equation for the percent of Amway distributors who have left after five years and finally came up with this formula:

X =(1 - (1 - .5 ) 5 ) x 100%

Where 'X' is the percentage of Amway distributors not in the business after 5 years.

The formula:

Y = (1 - .5 ) 5 x 100%

yields the percentage of Amway Distributors still in the business after 5 years.

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ENIAC computer

  

Amway Parody Press then enlisted the help of the ENIAC computer to help with the complicated calculation of Amway's failure rate after 5 years.

The complicated mathematical formula of:

X =(1 - (1 - .5 ) 5 ) x 100%

was programmed in to the  ENIAC computer.  After several minutes of calculation, the ENIAC produced the result of 96.875%.  According to this calculation, 97% of Amway distributors are gone after 5 years.

Almost equally as disappointing was the Federal Trade Commission's mention that 75% of Amway distributors quit in the first year with subsequent drop out rates of 25% per year.  Amway Parody  Press mathematicians came up with the following formula to program into the ENIAC:

X = (1 - (.25) x .754) x 100% 

The result in this case 92% have quit the Amway business in 5 years. 

Amway Parody Press researched the popular Amway Quixtar rumor that traditional businesses had a 90-95% failure rate after 5 years and could not find any evidence to support the Amway distributors' popular urban legend.

 
Startup Journal from the Wall Street Journal
Business Week
USA Today
Small Business Administration FAQ's
Redefining Failure and Closure - SBA