AmwayMulti-Level Marketing Company (US based, HQ in Michigan)

In 1949, DeVos and Van Andel had formed Ja-Ri Corporation (abbreviated from their respective first names) for importing wooden goods from South American countries. After their trip to the Nutrilite seminar, they dropped[clarification needed] this business and Ja-Ri became their Nutrilite distributorship.[11] In addition to profits on each product sold, Nutrilite also offered commission on the sales of products by new distributors introduced to the company by existing distributors—a system today known as multi-level marketing or network marketing. By 1958, DeVos and Van Andel had built an organization of over 5,000 distributors. However, following concerns about the stability of Nutrilite, in April 1959 they and some of their top distributors formed The American Way Association to represent the distributors and look for additional products to market

the company operates in over 100 countries and territories, organized into regional markets: the Americas, Europe, greater China, Japan and Korea, and SE Asia/Australia.

Their first product was called Frisk, a concentrated organic cleaner developed by a scientist in Ohio. DeVos and Van Andel bought the rights to manufacture and distribute Frisk, and later changed the name to LOC (Liquid Organic Cleaner).[13] They subsequently formed Amway Sales Corporation to procure and inventory products and to handle the sales and marketing plan, and Amway Services Corporation to handle insurance and other benefits for distributors (Amway being an abbreviation of "American Way").[14] In 1960 they purchased a 50% share in Atco Manufacturing Company in Detroit, the original manufacturers of LOC, and changed its name to Amway Manufacturing Corporation.[15] In 1964 the Amway Sales Corporation, Amway Services Corporation, and Amway Manufacturing Corporation merged to form a single entity, Amway Corporation.[16] Amway bought control of Nutrilite in 1972 and full ownership in 1994.

Multi-Level Marketing (MLM) is a marketing strategy in which the sales force is

compensated not only for sales they generate, but also for the sales of the other salespeople

that they recruit. This recruited sales force is referred to as the participant's "downline", and

can provide multiple levels of compensation.[1] Other terms used for MLM include pyramid

selling,[2][3][4][5][6] network marketing,[5][7][8] and referral marketing.[9] According to the US FTC,

some MLM companies constitute illegal pyramid schemes which exploit members of the

organization.[10][11][12]

MLM is one type of direct selling. Most commonly, the salespeople are expected to sell

products directly to consumers by means of relationship referrals and word of

mouth marketing. MLM salespeople not only sell the company's products but also encourage

others to join the company as a distributor.[1][7][13]

Companies that use MLM models for compensation have been a frequent subject of criticism

and lawsuits. Criticism has focused on their similarity to illegal pyramid schemes, price

fixing of products, high initial entry costs (for marketing kit and first products), emphasis on

recruitment of others over actual sales, encouraging if not requiring members to purchase

and use the company's products, exploitation of personal relationships as both sales and

recruiting targets, complex and exaggerated compensation schemes, the company and/or

leading distributors making major money off training events and materials, and cult-

like techniques which some groups use to enhance their members' enthusiasm and devotion