Amway was started by Richard DeVos and Jay Van Andel in Ada, Michigan in 1949. DeVos and Van Andel became distributors for Nutrilite food supplements after being introduced to the company and it’s products by Neil Maaskant. Nutrilite was a California-based direct sales company which was founded by Dr. Carl Rhenborg, developer of the first multivitamin marketed in the U.S.

The prospect of working with Nutrilite excited DeVos and Van Andel greatly because, in addtion to being paid for their own sales, they would be able to receive payment for sales performed by any new distributors that they introduce to the company. The process of paying an existing distributor on sales by new distibutors has become a cornerstone practice of the network marketing industry.

In 1959, The American Way Association was started after Van Andel and DeVos left Nutrilite in order to diversify their product line. The first product that they offered was a concentrated, organic cleaning product called Frisk. They changed the name of the company from The American Way Association to Amway Manufacturing Corporation in 1960, and then in 1964, they merged The Amway Manufacturing Corporation, Amway Services Corporation, and the Amway Sales Corporation to form the Amway Corporation.

In 1999, Amway established a new holding company called Alticor. Alticor contained three companies, but, in particular, it contained an internet focused distribution company called Quixtar. In 2001, Amway was officially renamed Quixtar for the North American Market. The international market would remain being called Amway. For 2009, the entire organization would fall under the name Amway Global.

Amway’s extensive product line offers over 450 different products directly from the company. However, there are hundreds of other products which can be offered which are manufactured by other companies. I have used many of the more common household products, and, although more expensive than other brands, I found all of them to be of excellent quality.

Amway’s marketing strategy is a combination of both direct sales and network marketing. Independent Business Owners (IBO) are paid based upon their business volume. They have three different methods of generating volume. They may sell products at retail price to consumers, they may sponsor others to become IBO’s, and get paid on their sales, and they may also purchase the products for themselves (wholesale price) as well.

Each IBO builds volume by selling to a retail customer as well as by purchasing the products for themselves at wholesale. Additionally, they are paid based upon the sales volume of their downline members. The income for the IBO is based upon their level, which is based upon the volume of all of their downline members.

Amway has had its share of controversy; however, the 3.5 million distributors generated over $8 Billion dollars in revenue for 2008. While Amways program may not fit for everyone due to the fact that it does rely upon sales through direct contact (i.e. presentations, etc.), it definitely offers some an opportunity to make some extra money.