Should I Bank My Baby’s Cord Blood?

Welcome to BOTTLESOUP, a parenting blog that does the Googling for you. Please note that nothing in this blog should be considered legal advice, medical advice, or financial advice; this blog is the opinion of the author, based on Internet findings. Within the post, you will see hyperlinks; these links are the source material for the post. Questions? Don’t hesitate to contact us.

Cord blood banking is a hot topic among expecting parents. You want to give your child every advantage. If there’s something you can do now to help your child later, you want to do it. If you’re a first time parent, your instincts are good. But with all of the information about cord blood banking, and the different companies to choose from, it’s hard to understand if cord blood banking is the right thing to do.

When doing your research, it’s helpful to look for scholarly or academic sources. A quick Google search may provide lots of results, but you may also be reading a lot of materials from cord blood companies. To be clear, these materials are not always wrong, but they are biased because these companies are trying to sell a product: cord blood banking.

What is Cord Blood Banking?

Cord Blood Banking is the storage of human umbilical cord blood. Unlike traditional blood banks, most cord blood banks are private storage banks (translation: a company or corporation) rather than public storage banks.

What does a private Cord Blood Bank provide?

Private Cord Blood Banks provide stem cell separation and storage. When a private cord blood bank receives a baby’s cord blood, they separate the stem cells from the blood and store the stem cells. The stem cells are stored cryogenically. (Source)

A private cord blood bank provides you with a guarantee that your child’s “cord blood” (stem cells) will be available exclusively to you and your family, should a future need arise.

What the experts told us

You should also ask your doctor and your child’s future pediatrician for their thoughts. This is anecdotal, but when I asked my doctor and pediatrician, they both advised against cord blood banking. In fact, they both had the same conclusion. They said that the odds of ever needing cord blood were slim. But even if the need arose, a sibling is often the ideal match. And if we were really interested in preserving the cord blood for potential use in the future, we should consider donating to a public cord blood bank.

Before that conversation, I didn’t know public cord blood banks were a thing.

What the online research says

The American Academy of Pediatrics (AAP) strongly discourages private cord blood banking. In fact, here’s their stance on healthychildren.org, an AAP website:

Other experts agree with the AAP

“The odds that the cord blood of any given baby will be needed by that baby later in life are quite small, explained Dr. Steven Joffe, the study’s senior author and a pediatric oncologist and assistant professor of pediatrics at the Harvard Medical School. One reason is that for many of the conditions where a blood cell transplant is the answer, a patient’s own blood cells can not be used, because they would reintroduce the disease you are trying to cure. A sibling donor is almost always ideal, but in most cases, that sibling is still alive and available as a donor, so banked blood is not needed.” (Source: “Is Banked Cord Blood Worth It?” The New York Times)

What is the cord blood banking cost?

If you decide to donate to a public cord blood bank, cord blood banking is free.

If you decide to use a private cord blood bank, costs vary. The average upfront cost is between $1,000 and $3,000. It is not covered by health insurance. You must pay a storage fee, annually, for the cord blood. The fee is anywhere from $90 to $175 per year.

For argument’s sake, let’s say you get the best “deal” possible on cord blood banking.

$1,000 initial investment + $90 per year for life

The average American lives to age 78.74. We’ll round up to 79, since the annual fee is due at the beginning of the year. But we’ll also assume that the initial $1,000 includes the annual fee for year one.

The bare minimum for private cord blood banking, over a lifetime, is $8,020.

You may think that’s a great deal. But just for educational purposes, let’s say you open a savings account for your child at birth and each year $90 is deposited. Over time, it could look like this:

Or even this:

We show you this to illustrate the opportunity cost and time value of money for cord blood storage.

What if I don’t store my child’s cord blood?

The good news: privately banked cord blood is rarely used as treatment. You are more likely to get a public cord blood donation to help you. Think of it this way: if you need a blood transfusion, you don’t donate your blood and freeze it in hopes that you may use it later. You rely on public blood banks.

Verdict

It’s a personal choice. But since the AAP does not support private cord banks, my personal opinion would be not to use a private cord bank.

Ebates Coupons and Cash Back
source: canvas free image

Should I Become a LipSense Distributor?

Welcome to BOTTLESOUP, a parenting blog that does the Googling for you. Please note that nothing in this blog should be considered legal or financial advice; this blog is the opinion of the author, based on Internet findings. Within the post, you will see hyperlinks; these links are the source material for the post. Questions? Don’t hesitate to contact us.

A few of our readers have requested a post on selling LipSense, asking for our opinion on the matter. As with any direct sales or MLM company, it’s important to do your research. Here’s what we found and how we found it

  1. LipSense is a SeneGence company.

    SeneGence lets people sign up as SeneGence Independent Distributors.

This is from the SeneGence website. If you click the photo, you will be directed to their website.

2. Lipsense is a multi-level marketing, direct sales company.

They tell you this right on their website. You can see that here:

3. How do you earn money with Lipsense?

It’s a traditional MLM / direct sales company with an upline, downline, commission, sales volume…I’m sorry, is your head spinning yet?

Unlike a traditional job – even a traditional commission based sales job – where you know how much you will make based on a specific criteria (ex: I work 1 hour, I make $10. I sell a house for $200,000, I make 5% commission of $10k) how you actually earn money and what you earn is a bit of a mystery.

While you’d think there would be a simple chart or excel sheet that could show you dollars earned per sale of each item. But, no. Instead, you can look at this presentation, which features charts like this:

Spoiler alert: I don’t understand this, either.

4. How much does it cost to become a Lipsense Independent Distributor? 

It depends on which package you choose. According to SeneGence, you have the choice to “Choose to be a Customer” or “Choose to be a Distributor”. You also have the choice to walk away. Remember, any business or financial decision is not something you should take lightly or feel pressured into. Your SeneGence New Distributor Kit (NDK) has an application fee of $55. Yes, you must apply and receive a NDK before you can purchase your starter kit.

Note that the NDK includes a $5 donation to the company’s charity. Not sure what this has to do with starting a business, but it seems to be required if you’d like to have the opportunity to buy the starter kit.

Let’s say you pay $55 for the NDK. Can you start selling SeneGence products now? Not quite. It seems that in order to be come a Lipsense distributor, you must also purchase a Distributor Business Kit. The Distributor Business Kits come in two options: one for $95 and one for $295. You can also opt for Distributor training, which costs $550.

So what is the least possible amount i must invest?

Because our goal is always complete transparency, some places on the website indicate that you do not need to have stock of the product in order to sell the product.  It’s called the Customer Direct Order Program.

However, what’s unclear about this is the language stating “All Distributors will have the option to participate in CDO and there is no fee to sign up.” It’s confusing because if you want to become a distributor, you need to pay $55 NDK and, it seems, purchase a Distributor Business Kit. If you don’t need to purchase the Distributor kit, perhaps the cost to participate in CDO is $55 for NDK. But you should confirm this before assuming you can begin distributing this way.

If you want to have the product on hand, it appears that the bare minimum start up cost is $55 for NDK and $95 for Distributor Business Kit for a total of $150 to become a Lipsense Independent Distributor.

5. How much money can I make as a Lipsense Independent Distributor? 

Almost unknown. Rather than share an exact analysis of pay, SeneGence provides complicated commission information. Because information on pay is limited, it’s hard to estimate potential earnings. Something to consider before signing up for an MLM or direct sales company is the unknown.

How much risk are you willing to take? Is $55 or $150 a lot of money for you right now? Or are you comfortable risking the chance you may never make that money back?

There are many examples of how MLM and direct sales companies are not wise investments. Here at BOTTLESOUP, we’ve written several articles on these types of companies. But don’t just take our word for it. Do your own research. See what people are saying about SeneGence on Glassdoor. Seems like a good company? Or does this seem like a place you’d avoid?

Many direct sales and MLM companies prey on women. Almost always stay at home moms or struggling single moms. They sell you on the idea of a sisterhood. A community. A business opportunity. The chance to have financial freedom. But they don’t truly empower you with the tools to succeed. While they’re busy building their bottom line, many women find themselves deeper in the hole.

And it’s not fair. Maybe you’re struggling to make ends meet. We understand. We’ve been there. But carefully consider if MLM or direct sales is the best way to improve your financial situation. Maybe start by asking yourself a few questions.

Direct sales / mlm checklist

  • First of all, how much money will I make doing this?
  • While I start this program, do I have enough money to invest and still meet my monthly obligations?
  • Since I’m just getting started (and possibly never sold anything before), how many sales can I reasonably expect to make?
  • Due to my lack of experience in sales, what qualities make be a good salesperson / how will I learn to become good at sales?
  • Because I’m still learning about this process, how will I ensure I know all the ins and outs of the business opportunity?
  • While I hope to make a profit, what will I do if I do not earn any money / is there a backup plan?
  • While I like this product, are there other competing products that people can purchase for less?
  • Due to other products on the market, are there any unique selling points (USP) that make this product worth more money?
  • Further, am I comfortable discussing this USP to my friends and family?
  • Most of all, is this something I’m comfortable and confident in doing, or do I feel like I’m desperate or pushed against a wall?

Due to the nature of direct sales / MLMs, you’ll want to make sure you’re comfortable speaking about the product with your audience. Beyond financial risk, sometimes you risk your personal relationships as well. In conclusion, if you choose to go into direct sales or MLM, always aim to be honest with your potential customers. Because if something doesn’t feel right, it’s best to sound the alarm. Since as a society we value rescuing others from burning buildings – not dragging them into danger.

 

Ebates Coupons and Cash Back

Should I become a Rodan and Fields Consultant?

You’re looking for information about selling Rodan and Fields. Perhaps you have a friend or family member who recently started an R + F consultancy. Maybe you’ve stumbled through the rabbit hole of the Internet and just ended up here. Either way, welcome. Here at BOTTLESOUP, we are committed to providing transparent, non-biased breakdowns of direct sales and MLM companies.

Disclaimer: I, owner of BOTTLESOUP, am not – nor have I ever been – a Rodan and Fields consultant. I am simply a blogger who analyzes different direct sales and MLM programs, many of which are of interest to women and/or moms, and presents my fact-based findings and opinions. All sources are cited as links within the article – and this article should not be taken in place of professional legal or financial advice.

About Selling Rodan and Fields

This article will dig deep into the intricacies of the Rodan + Fields consultant contract. (You can read the contract for yourself here.) We’ll examine:

  1. How to make money with Rodan and Fields.
  2. How R + F consultants can promote their business.
  3. The likelihood that you will make money from selling these products.
  4. Policies and other costs you should be aware of if you decide to become a consultant.

 

How to make money with Rodan and Fields

Maybe you’ve tried R + F products and truly believe in their goodness. You love their skincare offerings and enhancements like lash boost so much that you feel motivated to share this glory with the world. Maybe. Most likely you’re considering selling Rodan and Fields to make money. Right? So let’s find out how you can do that. First, it’s important to note that before you even open the consultant agreement on their website, the R + F Become a Consultant page has the following disclaimer:

Screen shot taken 01/21/2017. Click the photo to go to the R + F page and read for yourself.

Set your expectations now. There is no guarantee that you will generate any income. In fact, the Policies and Procedures are more direct: 

There’s no guarantee that you will not lose money.

So what, you say? It’s true that starting your own business is a risk. It’s even true that sometimes it takes money to make money.  Maybe you’re comfortable with the uncertainty – but it’s important you understand the risks upfront. From there, let’s discuss how you make money selling R + F products.

First (provided you are accepted as a consultant) you can sell through your consultant website and/or Pulse Personal Website (PPW). Now, as a consultant, you will receive a free trial of Pulse Pro. After your trial is over, Pulse Pro will cost $24.95 a month. If you don’t want to pay this, you can opt out and be downgraded to the free Pulse site, but you will lose all the data and customer info you collected during the trial. So, if you’re serious about selling, you’ll probably want to have the Pulse Pro service. Total cost to consultants: $24.95 x 12 months = $299.40 annually. Here are some interesting facts from the Rodan and Fields Terms and Conditions regarding Pulse:

What are SV credits?

Apparently, you receive SV credits if you pay for Pulse Pro. What does SV stand for? Sales Volume. And, as stated above, you must have a monthly sales volume of 100 in order to earn a commission. This isn’t something I’ve made up – this is straight from the R + F Compensation Overview. Take a look at the screenshot here:

So, let’s say you just want to sell R + F and you want to earn a commission your first month. So there are two ways to do this:

  1. Sell $100 worth of Rodan and Fields products through your free Pulse website. If you make 100 SV (Sales Volume), you will earn $10.
  2. Sell $80 worth of R + F products through your Pulse Pro website and earn 80 SV + 20 SV you get from subscribing to Pulse Pro and earn $10. However, factor the cost of the Pulse Pro website into these earnings ($24.95) and you’ve actually lost $14.95. So, you paid R + F to sell their products – they’ve made money off the sales and off of your subscription to Pulse Pro.

Oh wait, I knew I was forgetting something. In order to become a consultant, you have to pay $45 for your starter kit. So, in either situation, if you sell 100 SV in products, you are still in the red. Negative $35 and negative $59.95, respectively. So, in order to earn a profit, you must sell 451 SV in products under option 1 to earn a profit of $1. Under option 2, you must sell 700 SV and you will earn a profit of $0.05. Yes, that’s 5 cents.

Scared yet? We’re just getting started! Given the high price point of Rodan and Fields products, you may feel this is actually doable. But do your due diligence: how many people do you know who are willing to try something new – on their face – for $50+? Sure, there are cheaper options (some items costs as little as $6) but keep in mind that you will need to sell a lot in volume in order to make up the difference.

How R + F consultants can promote their business

Perhaps you have business or sales experience, and you think you have a potential market of customers that would support a profitable R + F consultancy. How can you market your business? Most Rodan and Fields consultants use social media to attract customers. This is a reasonable thing to do, because generally you have a captive audience of followers and you can share your passion and results with your friends and family. Here are a few things to consider:

  • Facebook rules and regulations require all business transactions to take place through a business page. This means that technically, you are not allowed to use your personal Facebook page to sell products. If you don’t want to be banned from Facebook, create a business page. Here are some other Facebook rules to consider.
  • Rodan and Fields has strict rules about what you can and cannot say about your experience using or selling their product. Specifically consultants:
    • May not make claims about the effectiveness of R + F products in treating skin conditions
    • Must disclose that you are a consultant
    • Cannot make claims about any income you may or hope to receive from R + F – specifically lifestyle claims like getting out of debt, taking a vacation, etc.

You’ve probably seen people violating these rules. But before you do, ask yourself if it’s worth it for a couple bucks. Because ethically, telling friends, family members and even strangers that selling R + F is some sort of life changing opportunity to earn income is wholly inaccurate. Do you want your friends and family making the same investment you did, only to struggle to earn money?

The likelihood that you will make money from selling these products.

Or: How much do I need to sell to recoup my Rodan and Fields investment?

As mentioned above, to break even after purchasing your $45 Business Portfolio (which is a mandatory purchase unless you live in North Dakota), you need to sell 450 SV ($450 in product) under the plan that gives you the free Pulse website. If you opt for the Pulse Pro website, you need to sell 700 SV ($700 in product) to earn back your investment.

But, you’re probably wondering how you can make more than that – how you can earn an income from selling Rodan and Fields.

 

Let’s compare earnings to a what you’d earn for a minimum wage job.

If you worked a minimum wage job, this is what you’d earn in a full-time week before tax:

To make that much, weekly, selling Rodan and Fields, you’d need a total SV of 2719 per week. Yes, you’d need to sell $2,719 in product weekly in order to take home the same amount as someone working a minimum wage job pre-tax. (And, before someone loses their mind, you’d actually earn $0.12 more than a minimum wage earner. 12 cents.) Don’t forget, you will need to pay taxes on any earnings from R + F.

Monthly? To earn $1,087 as a full-time minimum wage earner would, you need to sell $10,870 in product each month.

Wondering how you could possibly sell this much to earn this much? Never fear. R + F offers things like the Fast Start Program, which would allow you to earn more in commission and bonuses. Here’s a chart from their compensation plan:

Sure, it costs $695 to start this program, but who cares! At 15% commission, you’ll need to sell just $4,633 in product to make that money back!

 

Policies and other costs

If you decide to follow through, note that while it only costs $45 to become a Rodan and Fields consultant, your future customers are unlikely to shell out hundreds of dollars on these products unless they’ve tried them first. Also, you’ll need samples. Once opened, product cannot be returned. You’ll want to do some before and afters, too, so you’ll be using the products as well. R + F knows that you are primarily the customer. In fact, their first perk of being a consultant:

Therefore the first benefit is that you can purchase the R + F Products at Consultant Prices. Not selling the product. Not earning money. No, those are numbers 2 and 3. The first benefit is that you can buy their product for yourself at a discount. It’s like you’re a member of the preferred shopper’s club – and you paid a price to get in.

Verdict: Like many other direct sales and MLM companies, Rodan and Fields is – in my opinion – not worth the investment or effort. Remember, it’s more likely you’ll win big in a game of roulette in Las Vegas than it is for you to ever turn a profit with direct sales/MLMs. Most of all, Vegas is much more fun.

Finally, if you’re serious about earning money from home or starting a business, make the investment in yourself first. Because you can do it. You can find your passion. You are capable of hard work. Probably the saddest thing about direct sales and MLM is the easy way out mentality. These companies pitch an idea of fast-track business ownership. All you need to do is sell. But the truth is they own everything – and they profit whether you succeed or fail. My final piece of advice is to take a risk – but place the bet on yourself. Less people start their own business than join MLMs. Because starting a business is scary. While it seems less risky to sell someone else’s product, mathematically the odds are impractical at best.

Don’t take my word for it. Do your research! Do the math yourself. Share your findings in the comments below.  Because the truth is important.

Ebates Coupons and Cash Back

Is Younique a Unique Business Opportunity or a Scam?

younique

Hi, there. Mrs. Bottlesoup, here. If you’re reading this post, you’re either a regular Bottlesoup reader, or you found this through the magic of the Internet. If you fall into the ladder category, you’re probably searching for ways to work from home or start a side hustle – and you’re thinking about Younique. I totally understand and respect that. Here at Bottlesoup, I am committed to providing my readers with all the facts about Direct Sales and Multi-Level Marketing (MLM) companies, so you can make an informed decision about your financial future.

Let me preface this by stating I am not a Younique Presenter, and the following article is meant to be informative and objective. I research and source all of my articles. The hyperlinks throughout are usually sources, but if you have a question about the information and opinions below, leave a comment and I’ll get back to you J Thanks for stopping by. Without further ado, here’s my findings becoming a Younique Presenter.

 

What is Younique?

Younique describes itself as a “direct sales company”. So what does that mean?

The Direct Selling Association describes it as “a method of marketing and retailing goods and services directly to the consumers, in their homes or in any other location away from permanent retail premises. […] Unlike direct marketing or mail order, direct selling is based principally on personal contact with  the customer.”

What’s so bad about that? Nothing, in particular. However, the issue becomes the pay structure and what you’re actually incentivized to sell. Hint: it’s not makeup.

Can I make money with Younique?

The most truthful answer is yes, you can make money with Younique. But before you invest in a starter kit and begin recruiting other Younique Presenters, let’s examine the pay structure and other materials straight from Younique’s website.

Let’s take a look at Younique’s compensation plan, which Younique refers to as the Younique Royalties Program. Here is a screenshot directly from their website (you can also visit the page here):

screen-shot-2016-09-21-at-7-25-20-pm

Don’t feel bad if you’re confused by these charts. The charts are not simple. If you look at the footnotes, you need to have a certain amount of personal retail sales in order to qualify for different statuses. If you look at the top graph, you can see the volume you need to sell in order to qualify for Yellow status – it appears that once you’ve reached Yellow, you have a smaller PRS to keep up with in Pink, but if you look below you now have Company Wholesale Sales as a requirement and presenters who are underneath you. This, for you, would be the start of a pyramid. When you join Younique, you are automatically in a pyramid, as you are under someone else and part of their status. In order to move up in Younique, you need to recruit new Younique presenters – not just sell products. Ask yourself: does this make sense? Does it make sense to recruit your friends and family into becoming Younique presenters – and, if they become presenters, then they are no longer your customers. Who will you sell these products to?

If you dig around the Younique website, you’ll find an interesting disclaimer on the Rising Stars Leaderboards page:

screen-shot-2016-12-10-at-9-58-44-am

Less than the top 0.02% of Younique Presenters are making the Personal Retail Sales on this leaderboard – screenshot taken Dec. 10, 2016: screen-shot-2016-12-10-at-10-06-04-am

For the sake of simplicity, we’ll assume that these Younique presenters are earning the maximum possible commission, 30%, on their Personal Retail Sales (PRS).

If you look at the top leader, Rouse has a PRS of $8,852. 30% of that is $2,655 in commission. This means that the very top leader, the top seller in Younique, is earning $31,867 before taxes. If you look at #10 on the leaderboard, Koch, her PRS is $3,093.74. This makes her monthly check (30% of PRS) $982.12, and annual earnings are about $11,137.46. These numbers may look great to you, but the fact is that less than 0.02% of Younique presenters are earning this amount of commission. So, ask yourself, if the tippy top ranges from $31k – $11k annually, and less than 0.02% of Younique presenters earn this much, how much is the other 99.08% earning?

Significantly less than $982.12 – and possibly nothing. Possibly, Younique presenters are actually customers of Younique.

You see, Younique makes money from selling its product and  from recruiting new people to sell its product. It passes this on as a model for its presenters, but the fact is the company doesn’t care if you sell its products or not – the company has already profited from your starter kit. From your website. From your “sample” purchases. From the unpaid marketing and advertising you’ve done for the company, in hopes that somehow your efforts will lead to a paycheck for you.

This is a classic direct sales/MLM/pyramid scheme. If you look, you will find people who are passionate defenders of this company and others like it (LulaRoe, Jamberry, etc.). There are many people who join these types of companies in hope that it will pay off for them financially and bring “financial freedom”. In short, you are being sold a dream. Everyone wants to find a way that can balance their lives and bring more money into their household. It’s incredibly appealing to think that you may be able to supplement your household income – or even support your entire family – on something simple and easy as selling products to your friends and family. But if it were that easy, everyone would be wealthy. And this is another danger of these companies – when we get to this point in the narrative, where you are not as successful as you thought you would be – the company blames the presenter or “consultant” for their lack of success. But it’s not true. These programs are designed to profit the company; they are not designed to support success for those on the downline.

If you have joined this company or another like it and you have failed, please know that it is not your fault. It is nearly impossible (and just 0.02% of Younique presenters are moderately successful) to earn an income from a direct sales company. You have been duped, but it’s important that moving forward you speak out against this. Don’t let the propaganda for these companies rule – let me know if you’ve had a bad experience. You can share it anonymously in a future post.

Ebates Coupons and Cash Back

LuLaRoe or LuLaNo: Calculation Flaw, But Still LuLaNo

leggins

I’ve received thousands of comments from many, many readers about my original piece: LuLaRoe or LuLaNo: Will Your Investment Pay Off? Quite a few commenters pointed out that the math I used in my article was not accurate. I read their comments, I evaluated my post, and I’m providing an updated article in response. I’ll cut to the chase: I made a mistake in my original calculation. I deducted the initial investment of $5,500 twice. But, the cautionary advice I gave still holds true. And I hope you can understand that in my effort to be completely transparent, I am providing this revised article.

What Happened With Original Calculation

Here’s where the confusion began: I posted a link to a LuLa in Love article. That article had a graph illustrating how you could repay your LuLaRoe investment in one month. The graph indicates that if you sell 70 products a week in the first month, you can pay back your $5,500 investment in LuLaRoe.

Assuming there’s 4 weeks in a month, you need to sell 280 LuLaRoe products in that month. The LuLa in Love article indicates that the gross sales will be equal to $9,240 if you sell 70 products a week, or 280 products in one month (70 * 4 = 280). The graph also states that your net profit will be $5,040.

If you’re following, here’s what we have so far:

$5,500 initial investment in LuLaRoe (this is the money you put up front to become a LuLaRoe fashion consultant)

$9,240 gross sales from selling 280 LuLaRoe pieces

$5,040 net profit from sale of 280 LuLaRoe pieces

What does that give you?

screen-shot-2016-11-02-at-6-48-19-pm

I have no problem admitting it.

There was a mistake in the original calculation. The initial investment was deducted twice. Theoretically, you can make back your money in one month from selling LuLaRoe products. You have to sell 280 at a 54% profit, with an average sell price of $33 per item in order to earn $8,780. But, in theory, yes, it is possible. If you sell the remaining 181 pieces for a 54% profit (or approximately $18 profit per piece), you can theoretically earn $12,038.

screen-shot-2016-11-02-at-6-56-23-pm

So if the basis of my initial calculation was wrong, what about it was right? Here’s where your head will start to spin:

For the above to be true, you still need to be selling each product for an average of $33 per piece.

You’ll still need to make an average profit of $18 per item, or at a 54% profit.

But wait a second: $33 * 381 items in your original investment kit = $12,573 in gross sales (or approximately the $12,500 retail value LuLaRoe boasts your investment kit is worth). A 54% markup on $12,573 is $6,789.42. ($12.573 * 0.54). We’ll call it $6,750, as $12,500 retail value * 54% markup is $6,750.

screen-shot-2016-11-02-at-7-18-43-pm

 

So, from your $5,500 you could potentially earn $13,750 profit.

Stipulations for LuLaRoe Profit

The stipulations, again, are that you must:

  • Sell each product for an average of $33 per piece
  • Earn approximately $18 or (or 54% of $33) in profit per item sold
  • Sell all 381 pieces from your initial investment kit for the above price and profit

Here’s some food for thought: is 54% profit per item sold realistic? According to the Houston Chronicle, “Profit margins for retail clothes are generally within a range of 4 percent to 13 percent according to industry analysts.” (Source)

That means LuLaRoe’s expectation that you will be able to sell a product with a 54% profit margin is not on par with the industry average. (For the record, if you sold all your LuLaRoe for 4% profit margin, you’d make $228.60, or an average of 60 cents profit per piece sold).

despite calculation error, The truth about lularoe still hurts

Let’s get real. The wholesale cost of a LuLaRoe product selling for $33 retail is just $15. You get a 54% profit margin, giving you $18 per piece. That means you’re earning more than the product is even worth. 120% more. That is a 120% markup on LuLaRoe’s cost. LuLaRoe doesn’t get anything if you sell your inventory or if you lose it. Because, as with any wholesaler, the customer is the retailer. In this scenario, you are the retailer. LuLaRoe wins no matter what happens to your LuLaRoe “business”.

 

Now, many people have told me that LuLaRoe will buy back your inventory at 85%, minimizing the risk involved. You know what’s fascinating about that? Theoretically, you sell 10 pieces, you make $180 bucks, and you have 371 pieces left you decide to sell back to LuLaRoe. They’ll buy them back for you at 85% of the wholesale cost. Not the retail cost. So, $15 * 371 = $5,576 wholesale value of your leftovers. $5,576 * .85 =  $4,730.25. That $4,730.25 is what LuLaRoe will buy your 371 pieces back for.

Here’s what that looks like:

screen-shot-2016-11-02-at-7-34-48-pm

So, you’ve lost $590 attempting to sell LuLaRoe. You may be asking, why isn’t the wholesale value added to this? Well, because you are not going to get the wholesale value back. You’re getting 85% of the wholesale value. Also, is this math looking funky to you? It’s because you won’t earn a 54% profit margin or $18 per item. If the wholesale value was $15 per item, the $5,500 initial investment would be worth more than that (381items * $15 = $5,715). But it’s not.

How You Know LuLaRoe is Not Worth It

Here’s how you know this is a bad investment: the company won’t even buy their own product back for 100%. They won’t take a return. If the product was any good, they would happily take it back. You can take your Macbook back after 14 days, even if you opened it up and used it. But you can’t get a refund for unused, tagged clothing? Get real.

I hope you understand that although my initial calculation had an error, the math just doesn’t add up in my opinion for LuLaRoe. It’s incredibly difficult to sell one thing to one friend. Imagine selling 381 things at $33 each. Does it mean you can’t do it? No. But I stand by my initial stance: LuLaRoe is not the way to go. You don’t have control of your LuLaRoe “business”. There’s no negotiation with the wholesaler. There’s no diversification of inventory. You have one brand. That’s it. Start your own online retail shop. Think that sounds impossible? Babywearing supermom Frogmama did it. You can hear her story here.

Ebates Coupons and Cash Back
%d bloggers like this: