Amway: The Untold Story

[The following Amvox message was sent by Dave Van Andel sometime in mid-September, 1998]

"Remote message from the Diamond Hotline.

Hi everyone. This is Dave Van Andel with a heads up to Diamonds and above in North America about some corporate news that you may soon be hearing about. We wanted to make sure that you heard it from us first.

Because of some of the major economic and business activity that has been happening around the world, Amway Corporation will be tightening its belts over the next few months. The primary driver of this corporate belt tightening is the Asian economic situation and the strong U.S. dollar. Basically what this means for us is that every product imported from the U.S. or bought with U.S. dollars now costs substantially more in each of our Asian markets. Obviously, this has been adversely impacting our sales there. In addition to the Asian situation, the government actions in China and Korea changed the business environment for our distributors from one of dynamic growth to that of a virtual standstill. And while we are back in business in China, we are not yet back to where we were.

To that end, every Amway affiliate has been working on cost-cutting reduction plans for some time now. As part of these cost-cutting efforts, Amway is now offering a voluntary early retirement plan that will allow our long term employees to take a unique short cut to retirement or possibly to pursue other opportunities in their lives. We're also reviewing our staffing levels and will eliminate those jobs that simply aren't efficient for today's needs. Simply put, we are streamlining our operations wherever necessary in order to work smart and maintain our financial strength.

It's important to remember this is not the first time that we've had a dip in our growth cycle. In fact some of you may recall the downturn we experienced in the mid-eighties. But following that slowdown Amway enjoyed unprecedented growth. And actually, it is often during these temporary tough times that we come back with the most creative innovative ideas for taking this business to the next level. This is common for most companies, and you too may have experienced similar up-and-down situations in your own businesses.

Remember that Steve, Dick, Doug and myself and the rest of our families in the Amway management team are truly excited about our opportunities for growth in the months and years ahead. You've shown great enthusiasm for new business concepts, and we're right there with you as we develop new strategies for growth, particularly with the opportunities that technology brings. With all this in mind, we think the Amway business is poised for some spectacular gains in the coming years. We hope you think the same way as we build an even greater Amway business, not only for 1999 but for the year 2000 and beyond into the next century.

Thanks for listening, we'll be talking to you again soon, but we wanted to keep you informed, and we also want to thank you for your continued efforts and your devotion to this business. It truly is what makes Amway unique, and makes Amway great.

End of message."

Analysts See Bumpy Road For Shares of Amway Japan


TOKYO -- Amway Japan Ltd.'s stock would appear to be a bargain, considering its relatively fat dividend yield (4%) and high return on equity (43 times), coupled with a recent fall in its share price.

It would, that is -- if it weren't for the falling yen, and a spate of bad press engulfing the company. Analysts say the road ahead for Amway in Japan is rugged, and its share price will likely to continue to get hammered. Some stock pickers predict Amway's shares will fall well below a six-year low of 1,540 yen ($10.67) before year's end.

Among many issues facing the publicly traded Japanese subsidiary of Amway Corp., the U.S.-based direct seller of household
products, is a tumbling yen. Amway's executives and its army of distributors have woken up just about every day over the past few weeks to find the yen steadily weaken against the dollar -- a development that makes Amway's U.S.-made products more expensive to import, and thus more expensive to sell in Japan, when calculated into yen terms. The dollar was trading at 146.17 yen late Monday in Tokyo, compared with about 123 yen in mid-February.

The Japanese economy, meanwhile, shows no sign of recovering, and consumers' purse strings remain tight. Typical Amway
products -- detergent, shampoos and vitamins -- are positioned as more upscale products than those marketed by conventional Japanese makers of household products, and analysts say that even Amway devotees are now swallowing their loyalty to the American brand to buy cheaper soaps and detergents in supermarkets these days, hurting Amway.

Complaints or Inquiries?

But most crippling to Amway here, analysts say, is the flurry of bashing it has had to take in recent months from Japanese government agencies and the country's news media. Since last year a government agency, the Japan Consumer Information Center, has issued directives telling Amway to reduce the number of complaints against the company.

Amway Japan executives say that the more than 1,000 calls a year the JCIC says it has received from Japanese consumers for
the past several years aren't necessarily all "complaints," as the government agency claims. The problem, Amway says, is that the JCIC refuses to disclose breakdowns of the calls. Many of them, Amway believes, are simply general inquiries about Amway. A JCIC spokesman declined to comment.

The government's attention on Amway, meanwhile, has set off a rush of bashing by the Japanese news media, which has long derided Amway as a strain of a pyramid scheme that uses questionable recruiting tactics. An Amway spokeswoman strongly denies it operates like a pyramid scheme, which is illegal in Japan, or uses unscrupulous techniques to recruit. She says the company is cooperating with the government to reduce the number of complaints about its business and marketing practices, and that it has recently set up a toll-free phone line for consumers with questions and complaints, and has beefed up
distributor education.

Threat to Its 'Bread and Butter'

Still, all this bickering has impaired the most critical aspect of Amway's business: its ability to recruit new distributors, says Masumi Mizusawa, a Dresdner Kleinwort Benson analyst. For Amway, recruiting is the "bread and butter" of its marketing strategy. "Impaired recruiting abilities nullify all other positive measurements of Amway's performance," she says.

Ms. Mizusawa and other stock-pickers say Amway's share price -- which fell Monday in Tokyo to 1,600 yen, down 10 yen from Friday's close and down 66% from a 12-month high of 4,740 yen -- will likely trade on a weak note for the rest of the year. She sees a fall below 1,500 yen by year's end.

Tak Suzuki, an analyst at Merrill Lynch Japan Inc., is even more pessimistic: Considering a lack of support Amway receives from Japan's institutional investors and a threat of Amway's sales collapsing in the face of growing negative publicity, the stock could fall as low as to 1,300 yen by year's end, Mr. Suzuki says. "It's cheap, but you'd be crazy to touch Amway," he says.

Indeed, Amway has revised its forecasts for sales and earnings for the year ending Aug. 31, 1998. Amway had predicted that its full-year net income for the current year would fall 2.2% from a year earlier, to 22.6 billion yen, on sales of 222 billion yen. But because of "the adverse effects on its business from negative publicity," it now says the company expects net income to fall nearly 20%, to 18.5 billion yen, on sales of 208 billion yen.

Wall Street Journal, 7/7/98

Japan Consumer Agency Asks Amway To Reconsider
Sales Methods

TOKYO (Dow Jones)--The Japan Consumer Information Center said Tuesday it has requested Amway Japan Ltd. (AJL or 9821), a direct distributor of imported household goods, to reconsider measures to improve its sales promotion methods.

Amway Japan received a written warning from the agency on May 8, and submitted reports on improvement plans to its operations in early June, an agency official said.

Among the numerous complaints that the center has received from consumers was the fact that remuneration as a distributor wasn't as high as was promised by the company. Still others objected to their family members' overzealous involvement in the business.

The business improvement report which Amway Japan submitted earlier lacked concrete measures, the agency official said. The company is now expected to submit another report for improvement plans.

If the consumer information center doesn't see any improvement, it could then issue a formal public warning against the company, another agency official has previously said.

Amway Japan officials weren't immediately available for comment.

South China Morning Post
Wednesday  April 29  1998

Direct Sales
  Amway makes retail switch, Avon wavers

MARK O'NEILL in Beijing
Facing a nationwide ban on direct sales on the mainland, the giant Amway company of the United
States yesterday said it had decided to accept a government proposal to sell its goods through retail
outlets. However, cosmetics company Avon is undecided.

Beijing announced the blanket ban last Tuesday, saying direct sales had led to widespread fraud,
consumer losses and social disorder, and ordered firms engaged in direct sales to wind up their
business by October 31, saying they could sell their products through shops instead.

Of the US firms involved, worst hit are Amway, Avon and Mary Kay, which have invested more
than US$140 million in the mainland and provide income to more than two million people.

A spokesman for Amway in Beijing said following the ban the firm had decided to sell its goods
through dedicated retail shops.

Its 40 distribution centres in 18 cities and provinces will become shops open to the general public.

"We are drawing up a detailed plan that will be finalised soon," the spokesman said.

A company notice posted at outlets in Beijing said: "Our trust and confidence in the Chinese market
has not changed. We have invested more than $100 million in China. We solemnly believe that
China welcomes and protects legal investments by foreign companies and that the policy of continuing
to open the market will not change."

Distributors in an Amway centre in northeast Beijing said the ban would have varying effects on
the company's 80,000 distributors nationwide because some were full-time and some were

The company had little room for negotiations, one said.

"The Communist Party is a dictatorship, it does not care what one foreign company thinks. Amway will
have to change its method of selling. I have been doing this for eight months and have lost 10,000
yuan that I have spent on building up my network. The problem is that Amway is legal and gives us a
fixed price."

The best money was made by illegal companies which could raise prices.

A second distributor said he could manage because he derived his main income elsewhere.

"There was a lot of fraud and irregularities in the direct sales business. The government had good
reason for the ban even if none of us did anything illegal."

US Trade Representative Charlene Barshefsky raised the issue on the firms' behalf at talks last
week with Foreign Trade Minister Shi Guangsheng and State Councillor Wu Yi, saying that the
directive went beyond China's legitimate needs to have full consumer protection.

It was a serious matter when Beijing banned legitimately invested companies, she said, adding
the government should distinguish between legal companies, with money-back guarantees and
distribution channels that are easily accountable, and fraudulent and illegal chain-sales firms.

A spokesman for Avon in Guangzhou said that it was respecting the government regulations.

"Our company has a history of 112 years and we are in over 130 countries. We respect the
government decision and directive to get rid of illegal and unethical companies. We have always
abided by the law," she said.

Avon has not yet decided how to proceed with mainland sales while it awaits the completion of a
$40 million factory in Guangzhou, she said.

Company executives were due in Beijing yesterday for talks with government officials on the ban.

Last year, the mainland accounted for about 1.5 per cent of Avon's total sales.

South China Morning Post

Amway representatives are knocking on doors again
{Rule changes to a ban on direct marketing in the mainland allowed Amway to start selling again, albeit differently, MATTHEW MILLER reports.}

A May 8 meeting between State Councillor Wu Yi and executives from six direct-marketing companies resulted in rule
changes that allowed US-based Amway to resume its mainland business last week. Amway is the first multinational direct-marketing company to be certified under new government regulations that amended a State Council
ban outlawing such selling in the mainland.

"When Madam Wu met with us we presented our case and she presented hers," Amway China chairman Eva Cheng said.

"She made it very clear that direct selling is banned in China for the reasons carried in the news, but she also reassured us that a ban was not directed against ethical companies like Amway.

"She did assure us that she would help us find a way out."

During the week that followed, a delegation of officials from the Ministry of Foreign Trade and Economic Co-operation, State
Administration for Industry and Commerce and Bureau of Internal Trade visited Guangzhou and Shanghai on a fact-finding

"I explained to the investigation team that we could not sell our products in supermarkets," she said. "I took out a bottle of detergent and did a demonstration."

"I said: `This detergent is highly concentrated, and sells for 50 yuan {about HK$46.50}. Supermarket brands sell for 12 or 13 yuan, and I need sales people to explain how to use {the product}. "I said: `If you are telling me in the end I must go to the supermarkets to sell, you are asking me to leave China.' "

Mrs Cheng said the rules promulgated on June 18 needed a compromise.

That accommodation allowed multinational companies - whose overseas parents are direct-sales companies that have invested at least US$10 million in mainland manufacturing operations - to use "non-employee" sales representatives to bolster retail-outlet operations.

Also, the representatives may promote products door-to-door from which they can earn commissions on sales.

These representatives, however, cannot receive salaries or any benefits.

"The biggest difference is, of course, in terms of positioning," Mrs Cheng said. "We are no longer a direct-selling company; we are a manufacturing and marketing enterprise.

"Perhaps the most revolutionary part of it for Amway is that for 39 years in 80 countries and territories around the world, we would sell our products only to the distributors who in turn sell to the customers," she said.

"Philosophically, it really is difficult to swallow, because we have a commitment to distributors.

"Around the world, we do not want to voluntarily compete with them."

Before the ban, Amway China employed about 80,000 distributors with 1,300 employees.

Mrs Cheng expressed hope that many distributors would now become sales representatives for the company.

"We are offering them two choices," she said.

"One is they can be our privileged customers and enjoy a 15 per cent discount when they come to buy Amway products in the future. Or they can become Amway sales representatives, but their roles would be different." For Amway Asia Pacific, which has invested $100 million in manufacturing and distribution operations in the mainland, the ban on direct marketing led to a
substantial financial loss, Mrs Cheng said.

"We are talking one million yuan in overheads every day," she said.

"When Amway Asia Pacific reported a third-quarter {March to May} loss for the first time, a lot of that had to do with {not being able to do business in the mainland}," she said. "We continue to look at the market with optimism.

"We still have plans to build additional production lines in new areas such as nutritional products and cosmetics."

When asked what lessons the ban may have provided, she said: "I would say that doing business in China is a very bumpy ride and everybody has to fasten his seat belt."

Korea Herald News
11-05-97: FTC Fines Amway Korea, KSDIC for False Ads

The Fair Trade Commission (FTC) yesterday imposed a fine of 30 million won ($31,120) on U.S. multilevel sales
company Amway Korea for unlawfully criticizing Korea's detergent makers and making exaggerated claims in its
newspaper ads. Winding up a months-long probe on a dispute between Amway Korea and the Korea Soap &
Detergent Industry Cooperative (KSDIC), the FTC also ordered Amway to print an apology ad. "Amway Korea has
violated domestic fair trade regulations by making false claims about its detergent, Dish Drops, and its award from the
United Nations in newspaper ads,'' said Hur Son, a director of the FTC's Consumer Protection Bureau.

"Amway's ads on the quality of Dish Drops and the merit of multilevel sales business were exaggerated and misleading,''
he said. Meanwhile, the FTC also imposed a fine of 7.5 million won ($7,780) on the KSDIC for attempting to damage
the image of Amway Korea in an advertising campaign. The KSDIC has been ordered to publish an apology
advertisement also. The feud between the KSDIC and Amway Korea was touched off in April when the latter ran
newspaper ads saying that scientific experiments proved the superiority of Dish Drops to any Korean-made detergent.

The KSDIC soon countered that Amway Korea is an immoral enterprise which destroys the environment and widens
the nation's trade deficit with the United States. "Neutral experiments showed that there is little difference in quality
between Amway's Dish Drops and Korean-made detergents,'' FTC's Hur said


W30 Mil. Penalty Slapped on Amway Korea for False Ads

The Fair Trade Commission yesterday slapped 30 million won in surcharge on Amway Korea, an offshoot here of Amway Corp. of the United States, on charges of using false advertisements in the process of selling Dish Drops, the company's leading dishwashing detergent.

Along with the surcharge, Amway Korea was ordered to correct the unfair action and carry advertisements for apology on a daily newspaper.

The FTC, a government body that regulates market practices, also ordered 75 million won in surcharge on the Korea Soap and Detergent Association, which had carried advertisements slandering Amway Korea.

The FTC said Amway Korea's newspaper ads that a bottle of Dish Drops is equivalent to six bottles produced by local makers are misleading consumers. "While it's true Amway's Dish Drops is a concentrated detergent, allegations about being six times effective appear false," an FTC official said.

With regard to Amway's allegations that its multi-level marketing system would return gains to both distributors and consumers by abolishing marketing ladders, FTC's probe showed that supply prices for distributors contained 25 percent in sponsoring allowances and 25 to 35 percent of retail prices were allocated to distributors.

The FTC also accused Amway Korea of exaggerating a United Nations Environment Program (UNEP) award. "Our findings showed that the award given to Amway was merely a corporate achievement award by the North American office of the UNEP, being recognized for sponsoring environmental organizations," the FTC said.

The business watchdog body also charged Amway distributors for engaging in unfair business practices, insisting that the distributors had conducted comparative tests between Dish Drops and local products, an act deceiving consumers, while educating prospective sales persons.

It also termed groundless distributors' claim that Amway products are more environmentally friendly than local products.

The dispute involving Amway Korea began in March, when Korean consumer and environmental groups formed an anti-Amway panel and publicized a list of charges.


Amway Sells Domestic Goods Abroad

Amway, a multi-level marketing company, is selling Choco-pies and other local products in overseas markets in Australia and Southeast Asian countries through its global distribution network.

Since the company sells its wares on a multi-level basis, advertising and distribution fees do not have to be paid. Because of this,
increasing numbers of Choco-pie exporters are choosing the U.S.-based firm as their middleman. "Local Choco-pie manufacturers are exploring other export routes through Amway as their exports have been in decline due to the stagnant economies of Southeast Asia and Russia's announcement of a moratorium on foreign debt repayments," explained an Amway official.

Other local products are also being sold by Amway through its "One-for-One" campaign. Currently, 32 local companies such as Nongshim Kellogg, Ottogi, Maeil Dairy Industry and Pasteur Dairy produce and deliver their cereal, powdered milk and other products through Amway's distribution network.

Amway Korea sells some 300 different products ranging from fruit juice and toothpaste to socks and cosmetics.
Since entering the Korean market in 1995, the multi-level marketing company has been hurt by overzealous detergent marketing techniques and by charges that it had set up a pyramid-type sales scheme, factors which have caused its membership to shrink from 1 million to a mere 140,000.(By Yoon Yeong-mi Staff Reporter)

U.S. News & World Report, Oct 31, 1994
How Amway's two founders cleaned up: strong overseas sales helped Richard DeVos and Jay Van Andel add billions to their fortunes.

Chances are you've never heard of two low-profile multibillionaires, Richard DeVos and Jay Van Andel, whose combined fortune skyrocketed by $5.5 billion this year. Their soaring collective net worth--estimated at about $9 billion--has catapulted them into the exclusive ranks of America's 10 richest people, according to Forbes magazine. But these billionaires aren't the usual Silicon Valley entrepreneurs, Wall Street superinvestors or multimedia moguls. Rather, the 68-year-old DeVos and 70-year-old Van Andel--called "Dutch twins" because they both hail from Ada, Mich., a suburb of Grand Rapids where scores
of Dutch immigrants once settled--are cofounders of the homespun door-to-door retailing enterprise Amway Corp.

Despite their billionaire status, DeVos and Van Andel are modest about their wealth. Amway chairman Van Andel doesn't consider his affluence "the true measure of ... success." And DeVos, who retired from Amway two years ago, asserts that "getting wealthy was never one of my goals."

Export growth. Known for an evangelical belief in free enterprise, Amway is growing exponentially. In the fiscal year that ended last August, the company sold $5.3 billion worth of Amway-manufactured merchandise, including such everyday products as laundry detergent, cosmetics and vitamins, as well as branded items from Levi Strauss, Coca-Cola and others. That's an 18 percent increase over the previous year. Ironically, Amway, whose name is short for American Way, is prospering by exporting the American dream. DeVos's 39-year-old son, Dick, president of Amway, estimates that 70 percent of the company's fiscal 1994 sales flowed from abroad; he predicts the figure will swell to 75 percent by fiscal 1996.

The Dutch twins' wealth shot up last year after two public offerings established strong market values for pieces of the Amway empire: more than $1.6 billion for Hong Kong-based Amway Asia Pacific and about $5.1 billion for Amway Japan. In the first deal, Amway Asia Pacific spun off 13.4 percent of its shares to finance Amway's thrust into China. Shares offered at $18 climbed to $46 before falling back to $30. SEC filings disclose that the unit, which distributes products throughout Asia, is a huge success, with a gross profit margin of 60 percent. At 15-year-old Amway Japan, revenues have more than
doubled since 1989. The subsidiary's 816,000 salespeople have saturated the country by selling more than $40 worth of products annually to every Japanese family. Moreover, the balance sheet is rock solid: Amway Japan's $829 million
in cash and marketable securities far exceed its $301 million in debt.

Amway's concentration abroad is part of a strategy to offset slowing U.S. growth. President Dick DeVos declined to reveal how much of the company's sales increase is coming from domestic operations. But the shrinking contribution of U.S. revenues shows that Amway's sizzle is cooling at home. Part of the reason may be the controversy that has dogged the company.
Regulatory investigations and press criticism have tarnished its name. Three years ago, Procter & Gamble won a $75,000 judgment from Amway distributors, who were accused of spreading rumors that P&G's products were instruments of

Through it all, DeVos and Van Andel have maintained an unusual closeness. After attending Grand Rapids Christian High School in the 1930s, both graduated from their hometown Calvin College. The pair sold food supplements through a distribution network for 10 years before starting Amway from the basements of their next-door homes in 1959. Today, four children from each family make up the policy board that oversees Amway's operations. If the heirs keep making the right decisions, and the company continues its strong growth abroad, the DeVos and Van Andel clans could eventually rival rich American families like the Rockefellers and the du Ponts.

MEXICO CITY, Sep. 9, 1998 (El Financiero/Infolatina)-- Amway de Mexico expects to achieve sales of between 24 and 26 million dollars this year, which could represent decline compared to the 25 million-dollar sales achieved last year. The pyramid selling company said that it may increase its prices in the near future, in response to the slide in the peso, which, added to the six percent price hike in May, will further reduce the company's 45 thousand distributors' expectations. Mexico is Amway's second most important market in Latin America after Brazil.


ADA, Mich., Oct. 26, 1998 -- Amway Corp. today announced global estimated retail sales of $5.7 billion for the fiscal year ended Aug. 31, 1998, a decline of more than 18 percent from estimated retail sales of $7 billion the previous year.

This figure represents the combined results at estimated retail for the 49 affiliate markets supported by privately owned Amway Corporation and its publicly traded sister companies – Amway Asia Pacific Ltd. and Amway Japan Limited – which announced their annual sales separately during the past 10 days.

"Fiscal 1998 was a challenging year," stated Amway Chairman Steve Van Andel. "Nearly half of our business is in Asian markets where economic upheaval resulted in weak consumer demand. Our revenues were further reduced when translated from weak Asian currencies back into strong U.S. dollars."

About 85 percent of the decline Amway experienced during the past fiscal year can be attributed to factors associated with the strong U.S. dollar, especially as this coincided with the weak Asian economy. In fact, the majority of Amway’s decline in sales can be attributed to just five affiliate markets – Japan, Korea, China, Malaysia and Thailand – which together declined by almost $1 billion in estimated retail sales. Despite these disappointing results, Amway has enjoyed an 18 percent Compound Annual Growth Rate since it began reporting estimated retail sales in 1964.

"We’ve enjoyed phenomenal growth, including double-digit increases during the early and mid 1990s," said Amway President Dick DeVos. "We remain confident in the fundamentals of the Amway business and we’re finding new ways to energize our business through the products and the business opportunity we offer our distributors and customers. Because of what we’ve accomplished in the face of many challenges, fiscal 1998 remains one of our best years ever."

Among Amway’s numerous highlights for fiscal 1998 were:

Opening a new affiliate in India, the world’s second most-populated nation; more than 100,000 new distributors have embraced the Amway business  opportunity in that country since it opened in May. Amway also opened new affiliates in the Dominican Republic and Venezuela.

Reopening Amway’s affiliate in China, three months after a government ban on direct selling. Amway China negotiated a new mode of operations with the government allowing it to retain its independent sales force – the first direct selling company to do so.

Completion of several new facilities, including a $25-million expansion of Nutrilite processing facilities in Lakeview, Calif.; a $17-million Personal Care manufacturing facility and $17-million Paper Products facility in Ada; an $11-million Amway Service Center in New Jersey and a new Service Center in Puerto Rico.

The acquisition of Aqua Purity Sentinel, Inc. and FutureFlo Systems, Inc., the manufacturers of Amway’s water and air treatment systems, further integrating Amway’s development and manufacturing of home tech products.

Among significant product launches for Amway in fiscal 1998 were:

Amway Food Storage System by Rubbermaid in North America and Europe following a successful launch in Japan in fiscal 1997.

Amway’s IMPROVISATION® line of tableware, including dinnerware by Wedgwood Home, flatware by Oneida, Ltd., stemware featuring Marquis by Waterford Crystal, serveware by WiltonArmetale, and textiles by W-C Designs. Herbal supplements in Amway’s NUTRILITE® brand plus several new ARTISTRY® products, including Body Definer Firming Gel, Smudgeproof 200 and Waterproof 200 Mascaras and reformulated Alpha Hydroxy Serum Plus.

While Amway Corporation builds on these and other successes, it also will take actions to align costs more closely with business volume. Amway announced in September a Voluntary Early Retirement Program that has offered nearly 700 employees the opportunity to retire early. This and other workforce reductions will help bring costs in line.

"We remain very optimistic about the future of this company," said Mr. Van Andel. "Its foundation is very solid, with excellent products, loyal consumers, and the desire of Amway distributor entrepreneurs around the world to achieve through a business of their own. We believe that the best business opportunity in the world continues to be an Amway business."

"Amway remains committed to the success of its distributors around the globe," added Mr. DeVos. "We will continue to explore new strategies, alliances and programs that will enhance their ability to achieve their goals through an Amway business of their own."

Between 1990 and 1996, Amway’s estimated retail sales tripled, its independent distributor force doubled to more than 3 million, and its employee base  increased from about 10,000 to more than 14,000. This decade, Amway has added 29 new affiliate markets, bringing its total to 49 worldwide. Independent Amway distributors market more than 450 Amway nutrition and wellness, personal care, home care, home living and commercial products, plus thousands of brand-name products through Amway catalogs and a variety of services and educational

Dow Jones Wires:

Amway Japan 1Q Net Fell 41.9% To 16c A Shr

Amway Japan Ltd - Tokyo
Figures are in yen.

1st Quar Nov. 30:
                           1998               1997
 Sales               39,320,000,000     51,321,000,000
 Net income           2,797,000,000      4,821,000,000
 Avg ADSs (basic)       288,100,000        288,200,000
 ADS earns (basic)
   Net income                  9.71              16.73

In U.S. dollars, the company posted net income of $22.7 million, or 16 cents per American Depositary Share, on sales of $319.7 million.

Amway Japan Ltd. (AJL) said its sales performance in the first quarter continued to reflect the effects  of depressed economic conditions in Japan, with unemployment at record levels and private consumption declining.

Amway Japan also said sales were hurt by the effects of unwarranted negative publicity about the company's business, which continued to make it more difficult for existing distributors to sponsor new distributors, leading to a decline in new distributor applications.

Distributor renewals, however, continued at a very healthy pace, the company said.

Amway Japan Ltd. said net income for the first quarter was down 40% to $22.7 million, while net income per share declined 41.9% to 16 cents per ADS.

The company said its gross margin fell in addition to sales, principally because of the weakening of the yen against the dollar in fiscal 1998.

Amway Japan has instituted "very tough cost controls" to decrease total operating expenses and is strengthening its distributor partnership.

Amway Japan Ltd. said its projections for fiscal 1999 are net sales of $1.48 billion, operating income (before reclassification of enterprise tax) of $200 million and net income of $116.3 million.

Originally, the company had expected fiscal 1999 net sales of $1.3 billion, operating income of $174.5 million and net income of $101.4 million.

The new projection is due to the recent strengthening of the yen against the U.S. dollar.