Hidden Costs of Becoming a Jamberry Consultant
March 29, 2016
If you’re wondering if becoming a direct sales consultant for Jamberry sounds too good to be true, you’ve come to the right place. Here, with the help of been-there-done-that Jamberry consultants, we are delivering the exclusive, behind-the-scenes look at what becoming a Jamberry Consultant truly costs.
In this installment of the Jam Series, we’ll be looking at the hidden costs of starting your Jamberry business. This article is meant to inform you of the Jamberry Consultant start-up expenses in an easy to understand, straightforward manner.
Here are a few hidden costs of becoming a Jamberry Consultant:
- Starter-Kit. Jamberry is upfront about making an investment in your Jamberry business. So you may be wondering what’s the hidden cost in that? Well, for $99, you get some promotional materials, but there’s a catch: the promotional materials expire. This issue goes beyond your first few weeks with Jamberry. No matter how many samples or promotional materials you have, if Jamberry releases something new, you can no longer use the old material to promote your “business”. Also, it’s against the rules to create your own catalogs, brochures and even your own business cards. Since you’re running your own “business”, you may think it’s easy to get away with creating your own marketing materials. But think again. Your fellow Jamberry Consultants (AKA “Jamsisters”) will rat you out ASAP. Because killing the competition is the easiest way to get to the top. It’s biology. Seriously. Lions kill cubs. Veteran Jamsisters kill newbies. Oh, also: you pay shipping & handling for your starter kit. It comes out to $124, not $99.
- Promotional Materials. I touched on this, but after your starter-kit promo goods are gone, it’s your responsibility to refill and replenish your samples. And how are you going to sell a product you can’t check out in stores without samples? Catalogs are 10 for $6.50, or $0.65 each. That doesn’t sound like a lot, right? We’ll get back to that in a minute. In addition to catalogs, you’ll want business cards, 7-day challenge cards, envelopes, labels, stationary for those hand-written notes, etc. Are you seeing dollar signs yet?
- Shipping. In a perfect world, you wouldn’t have to ship your promotional materials to potential customers. In reality? Your friends list will be so sick of hearing about Jamberry that you’ll need to branch out and find new territory (or you live far from home, your college friends, etc.) To send out just the catalog, you need an envelope and 4 forever stamps ($0.49 * 4 = $1.96). If you take the envelope to the post office and have them weigh it, you can save $0.10 per catalog, but you’ll still be spending $1.86 + gas + time to send out your Jamberry catalogs.
- Website. After your first 3 months as a Jamberry Consultant, you’ll start being charged $10/month for your Jamberry website. That’s $120 a year, for those keeping score (and for those who want to get super technical, yeah, your first year would be $90 “only”). If you’re making sales, this doesn’t seem so bad, but then comes the monthly Personal Retail Volume requirement to really screw you over.
- Monthly Personal Retail Volume (PRV). In order to maintain your status as a Jamberry Consultant (you mean buying a starter kit and paying for a website was not enough?!), you must sell $200 in product a month. This $200 PRV does not include taxes or shipping and handling. It is purely the retail cost volume. In order to achieve this goal, you need to sell 13.3 nail wraps at $15/each per month. While that doesn’t sound like a lot, many consultants fall short and end up buying $200 in product by themselves to ensure they stay active as consultants. Of this $200, they receive $60 in commission (or in return, if they purchased the wraps for themselves), but after paying for their website, the commission is only $50. And, if they’ve promoted the product and purchased or sent materials, that also reduces the “profit”. Stay with me and let me break it down for you:
The average conversion rate from promotion to sale is 2.35% online. Yes, I’m talking digital. Let’s say you promote your Jamberry business on Facebook to a group of your friends and acquaintances. In order to make 13.3 sales, you need to have directly reached 565.95 (13.3/0.0235) people regarding Jamberry. This doesn’t mean people who are passively in your network; it means you need to have directly reached those 565.95 individuals.
But what about in person direct sales? Well, approaching someone about Jamberry for the first time in real life is the equivalent of a cold call. Only 2% of cold calls result in an appointment in traditional sales. That means you’d have to be in contact, directly, with 28,298 (565.95/0.02) people in order to maybe sell 13.3 nail wraps per month, assuming you can covert at 2.35% in real life.
For fun, let’s assume you want to reach 28,298 people with catalogs and samples in real life. You’d need to spend $18,292.70 to give each one of those people a catalog. Just a catalog. Samples? I’ll spare you the heart attack. By the way, you’d still only make $50 in commission after selling 13.3 nail wraps and paying for your website. So, you’d be in the red -$18,242.70.
So, online is definitely the way to go, right? If you send out 565.95 catalogs, you’ll spend $1,420.53 (565.95 * ($0.65+$1.86)) to make $50 in commission. -$1,370.53 Yes, I was nice and assumed you’d save the $0.10/mailer by bringing your catalogs to the post office.
Did you know that, on average, it takes a sales person 5 times to reach a person in order to close a single sale? So, you could send 5 catalogs to 565.95 people. That will cost you $7,102.67 ($1,420.53 * 565.95). But maybe you’ll sell a nail wrap to all 565.95 people after that. Let’s be optimistic and say that you achieve that. That would be $8,489.25 PRV. You’ll make 30% commission, which comes out to $2,546.77 commission. But, since you spent $7,102.67 to make that happen, you’re negative. Your loss is -$4,555.90, to be exact.
What more do you need to know?