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•16 The 100 Greatest Business Ideas of All Time

Idea 9 – Make your friends your customers (Amway)

‘The business of America is business’, remarked Calvin Coolidge, and the story of
Amway and its founders bears this out. Rich DeVos and Jay Van Andel met in high
school and found themselves at one with their views on the American dream. They
were sure that it was possible, for anyone who put the energy and work in, to own
his or her own business and grow it to the size they preferred. They resolved to work
together towards their dream when they finished military service.

Their first venture was a drive-in restaurant, but it was after a break to sail in
South America that their first real success came when they became independent
distributors of Nutrilite vitamins. Their version of the American dream evolved into
the realisation that direct person-to-person marketing could build a business fast.

Real growth, they discovered, would come when they attracted others into the
selling side of the business. Using the same person-to-person method they recruited
distributors for their new company Amway. The Amway Sales and Marketing Plan
told future distributors how to start selling and getting their own distributors. To
begin with, the main product that these channels sold was a multi-purpose cleaner.

In its first year of business Amway sold more than half a million dollars worth of
product. Growth was rapid in all areas, but it is when you look at the ratio of em-
ployees to distributors that you see the potential of pushing out to more and more
friends and acquaintances to bring them into the distributing fold. By the end of the
1960s they offered 200 products and had 700 employees. The number of distribu-
tors in the USA and Canada who were, in the jargon of the company, building
Amway businesses had reached 100,000.

The 1970s was a decade of further huge growth starting from an annual turn-
over of $100 million. It was also at this time that the company finally proved to the
FTC that Amway offered a genuine business opportunity and was not involved in
‘pyramid selling’.

The product line continued to grow with Nutrilite Dietary Supplements and
the Personal Shoppers catalogues allowing further diversification. By the end of the