Quixtar and Amway - Most of us will know who Amway is. They are perhaps the largest network marketing company based in Utah. When they first formed an agreement with Bank of America to issue their credit card, they had changed their US operations "brand" to Quixtar (since 2000). Hence, the first credit card issued for Amway by BOA was actually the Quixtar Visa Card. But when Amway changed it's name again back to Amway Global, the quixtar card is no longer available. But instead, that credit card is now the Amway Visa Card. Since it is only a name change, they are identical as far as card features go. For those of you who are curious as to how the "Quixtar card looked like, here it is.
Understand PVs and BVs - To understand how this card works, you have to understand how Amway compensates its "Independent Business Owners" (IBOs). IBOs will make the difference between products purchased from Amway and the amount that is sold to their downline or customers. In addition to that, IBOs are entitled to bonuses as well. How that is calculated is where "PV" and "BV" comes in.
Bonuses based on performance are based on sales value1, which is tracked by PVs and BVs. PVs is a unit amount that is assigned to a particular product. So let's say you sell Amway shampoos (if they even have this!) and it is assigned 10PV per bottle. If you sell 100 bottles of shampoo, you will get 1,000 PVs. The higher the PVs, the higher the percentage of bonus will be.
BVs are the dollar amount assigned to each product. Let's take the Amway shampoo as an example. Let's assume the BV is $2 for argument sake. If you sell 100 bottles of shampoo, that is equal to 200 BVs.
Based on the number of PVs you "earn", you will be paid a percentage (between 3% to 25%) of the BVs (not PVs) that you generate. (see screen shot below).
So How Does The Anway Card Help An IBO? - This card helps an Anway IBO earn more PVs and BVs. How? Cardholders will earn 1.8%PV and 3% BV for every dollar spent purchasing Amway products. You will earn 1.25%PV and 2% BV for every dollar you spend on other regular non-Amway purchases.
But is the rebate or payout good enough compared to a regular cash back card? - To find out whether there is real value in earning extra PVs and BVs from using this card, we are going to compare it to a regular cash back card.
But first, let's make a couple of assumptions here. Firstly, let's assume you are a successful IBO and make enough to qualify for the top end of the bonus pool (ie 25% of PV). Let's use the shampoo as an example. Let's say you sell 800 bottles of shampoo, you will then earn 8,000 PVs and 1,600 BVs. According to the chart above, you qualify for the 25% BV bonus. Let's further assume that you spend $1000 on your card a month (to keep things simple). Of the $1000, $200 is spent purchasing Amway products for yourself (because you love it, use it and believe in it). The rest is spent on other purchases. Based on the card's formula, you would earn 3.6 PVs and 6 BVs from your Amway purchase. For your non Amway purchase, you would earn 10 PVs and 16 BVs from your non-Amway purchases. In total, you would have made 13.6 PVs and 22 BVs.
When you add that back to your regular PVs and BVs, it would hardly make a difference to your bonus. But just to be precise, the bonus attributed to the spending on the card would be (25% multiplied by 22 BV) $5. $5 rebates out of $1,000 in spending is equal to a paltry 0.5%! Because you have already qualified for the top tier bonus, you will receive it regardless of how much you spent on your credit card and how much extra that PV or BV earns you.
But what happens if you are a newbie, or simply not having a good month and are not successful? Then no matter how much you spend on the card and how many extra PVs and BVs you get, you will not get any bonus.
Smells like a rip-off to me - And here lies the problem of the card. While it allows you to earn more PVs and BVs, the bonus you make will be based on how well an IBOs business is for the month and not how much you spend on the card. In the event that an IBO does not make enough to qualify for a bonus, then regardless of how much he or she spends on the card and how much extra PVs or BVs they make, they will not receive any bonus. Hence, spending on the card goes to waste (as in you earn nothing out of it).
Even if you qualify for the top tier bonus, in the example we used above, the extra bonus you make from the BVs and PVs you earn from card spending works out to only 0.5% based on your card spending. Compare that to a regular 1% cash back credit card. With $1,000 in monthly spending, you are guaranteed to earn $10 in rebates. Whereas for the Amway card, you will get money back if you qualify for a bonus based on your sales. And even then, the figure is unlikely to approach anywhere near 1%.
Stay Clear Of This Card - All I can say is one should stay clear of this card. Simply getting a regular cash back credit card is better than this.
1. Amway Business Guide