Update.
If you’re reading this article, you’re either an avid BOTTLESOUP reader or you’re curious about becoming a LuLaRoe Fashion Consultant. Either way, you’ll enjoy this in-depth look at the LuLaRoe business model. By the end of this post, you’ll have a clear understanding of the company. Allow me to preface this by saying I am not a LuLaRoe Fashion Consultant and, thus, I have no skin in the game. This article is meant to be objective and informative.
Let’s begin.
What Kind of Business is This?
LuLaRoe is a direct sales company that recruits informal retailers, branded as Fashion Consultants. Translation: LuLaRoe does not hire Fashion Consultants. You are not a LuLaRoe employee if you sell LuLaRoe. You do not get any LuLaRoe health benefits, retirement, etc.
Essentially, the relationship you have with LuLaRoe is that of a retailer and wholesaler/manufacturer. LuLaRoe produces the product and sells it to LuLaRoe Fashion Consultants at wholesale cost – essentially like Target, Walmart or any other big retailer, it is your responsibility to sell the product in order to recoup the wholesale costs and potentially earn money on markups.
Sounds simple, right? You know lots of women who like LuLaRoe’s products. In fact, there’s thousands of women on the LuLaRoe BST (Buy/Sell/Trade) groups! There must be money for the making!
Not so fast, tiger.
How Much Money Do I Need to Get Started with LuLaRoe?
LuLaRoe requires a substantial monetary investment for sales. Unlike other direct sales companies like Jamberry and KEEP Collective, LuLaRoe requires you purchase pieces at wholesale and in advance of sales. There’s no catalog. There’s no online shop. You can create a “pop up” shop through a Facebook group or in person, but, essentially, the burden of creating incentive, collecting payment, and recuperating your operating costs are all on you. So how much money does it cost to begin?
Yes, you read that correctly. The start up cost to become a LuLaRoe consultant is between $5,000 and $6,000.
Let me be quite clear: LuLa Girls on FIRE is a website dedicated to recruiting new LuLaRoe Fashion Consultants and occasionally selling some product. Don’t believe me? Hop on over to the website and tell me which is easier: buying a pair of LuLaRoe leggings or getting tons of info geared to becoming a consultant? Yeah. You can’t even buy any LuLaRoe products from this LuLaRoe Fashion Consultant on her website.
How Long Will it Take Me to Earn Back my Investment?
According to LuLa in Love, the retail value of a $5,500 start up purchase is $12,500. This assumes that each piece will net an average profit of $18 (and you have approximately 381 items to sell). LuLa in Love provides the following graph:
Perhaps you’re wondering what’s wrong with this graph and its math. I’ll explain:
Let’s say you want to pay off your LuLaRoe investment in 1 month. According to the chart, you need to sell an average of 70 items per week, or an average of 10 pieces per day. If you meet this sales goal, 70 * 4 weeks in a month = 280 pieces sold. Your kit contained 381 pieces. You’ll have 101 pieces left to sell, and you’ll still be in the hole -$460 for the first month. IF you’re scratching your head, let’s back up: you invested $5,500 in your starter kit/inventory. You earned $5,040 from selling 280 pieces of LuLaRoe clothing. $5,500 – $5,040 = $460 shy of your initial investment.
But that’s ok because you still have 101 pieces of inventory left to sell, right?
Sure. If you sell 101 more items at an average of $18 profit per item, you will earn $1,818. Oh, wait, you need to subtract that -$460.
$1,818 – $460 = $1,358.
You will have broken even, but you’ll be out of inventory.
Also, wasn’t that inventory supposed to be worth $12,500 retail?
Yes, the retail price will add up to $12,500 in revenue. But you will not earn $7,000 profit from your $5,500 investment. (Profit = Revenue – expenses) It’s easy to get confused. Don’t feel stupid. I’ll break it down:
$12,500 – $5,500 = $7,000. So how does a $5,500 investment only earn you $1,358 instead of $7,000?
The answer is pretty frustrating. In order for their math to make sense, they must use the highest retail prices to estimate the worth of your inventory. However, it assumes you will price your retail in the mid-level instead of the high level cost. Reality is, with so many LuLaRoe Fashion Consultants many consultants end up having to price items competitively. And in business, competitive means cheap. The lowest possible cost. Why? Well, you need to make sales. If you don’t make sales, then you will lose your investment. For the record, for the $12,500 “value” to be accurate, each piece would need to have an average retail face value of $32.80 ($12,500/381 pieces). The LuLaRoe butter leggings everyone loves? They sell for 2/$40. This makes their retail face value $20 each.
Would you rather make $18 profit on a couple sales and be short a few thousand dollars or lower your prices to make just $2 a sale but “repay yourself” quickly?
For fun, let’s say you engage in competitive pricing. Your LuLaRoe pop up is cheaper than all the rest of the ladies. You sell 381 pieces at a $1 markup and earn just $381, BUT you’ve paid off your investment. Right? Probably not. You’re assuming there’s no shipping and handling fees on your part, which, there will be unless you exclusively sell local. So, add postage and packaging to your costs. If your average shipping and packaging cost is $1.50 an item, you’re actually in the hole -$190.50.
I haven’t taken into account those who have absolutely lost hope and are unloading their LuLaRoe products as cheaply as possible just to get a fraction of their investment back.
But let’s be generous and say you unload all your stuff for an average $18 profit per piece. Let’s say you earn that $1,358 and business is booming. What then? You will need to purchase more inventory. So, let’s say, for simplicity, you decide to purchase $5,000 more in wholesale LuLaRoe clothing. To “repay yourself” this time, you’ll need to earn:
$5,000 – $1,358 = $3,642
You’ll need to earn $3,642 to repay yourself. Or sell approximately 203 pieces to break even this time. After 203 pieces, the remaining 178 pieces are profit. Sell them for an average of $18 profit per piece, and you’ll earn $3,204. But, again, you’ll need to get more inventory to continue.
So, do it again. Another $5,000. This time:
$5,000 – $3,204 = $1,796
Hmm. Ok. So this time, you sell 100 pieces at an average $18 profit per item, and you earn $5,058. Yes, for the first time you actually profit while replenishing inventory. Rate of return? 1.16%.
Bottom line:
Essentially, you must invest over $15,000 and sell everything at an average profit of $18/item to start seeing true returns and true profit on your inventory.
LuLaRoe Fashion Consultants and recruiters will tell you “it takes money to make money” and “every business owner invests in their company” and these things, in many cases, are true. However, the differences between a LuLaRoe Fashion Consultant and a business owner are vast. First, LuLaRoe sets the terms and restrictions. Second, you don’t own or control anything; you and your “business” are dictated by the home office. Third, successful business owners enter into entrepreneurship by creating a business plan and working the numbers (like I walked you through).
Being a successful LuLaRoe Fashion Consultant takes a lot more than $5,000 and a few LuLaRoe pop up shops. It takes sophisticated marketing, business savvy, and significant investment to become a retailer. (I’m not the only blogger who feels this way!) And, please don’t mince my words: I said a retailer. I am not suggesting that marketing, business knowledge, and seed money are the keys to success for LuLaRoe. In fact, my opinion is that LuLaRoe is a risk not worth taking. The returns are very low. The investment is very high. And the market is futile. LuLaRoe is not an innovative necessity; it is a company that produces clothing in poor countries, very cheaply, then profits from wholesaling it to you. Make no mistake: you are LuLaRoe’s customer; they don’t care if you make sales or not.
Just because you’re asked to invest a significant amount of money does not mean the return on investment will be equally significant. Retailers operate successfully by diversifying the products they sell, whereas as a “fashion consultant” for one brand leaves little margin for error. If the product is a flop among your audience, then you have nothing left to offer.
Update based on comments found here.
Shirin Zakerion says
Hi Bottlesoup, I’m the author of Lula in Love, how do I contact you?
Mrs. Bottlesoup says
The contact page is a good place to start.
Data Junkie says
Mrs. Bottlesoup, I just love your analysis of these direct sales companies. I wish you had the time/energy to cover every single one (can you do Zija next?). My biggest take-way from your analysis of these companies is your brilliant observation that direct marketing sales reps are not business owners at all, but rather they are customers! Considering that most of these companies have sales minimums to remain “active”, these sales reps quickly become repeat customers. If these folks only knew that the sales to the bottom 99.5% provide the profit to the top 0.5%. No sales to the public necessary. Therefore, churn in the sales force is a key component to success at the top…the faster the churn, the more inventory purchased by the down-line sales force. Each new LuLaRoe recruit brings in ~$5K for the company. Sales to the general public is completely unnecessary for up-line profitability. Thus the compensation plan is built with incentives not to sell, but to recruit, recruit, recruit more customers, er I mean sales people!
Mrs. Bottlesoup says
Thank you. I’d be happy to look into Zija!
Side note: It always irks me that these companies are LEGALLY getting away with this crap.
Casey Stanton says
It always irks me when someone gets away with slandering a company and its consultants while offering nothing of value to anyone.
Mrs. Bottlesoup says
The value I’m offering is saving people thousands of dollars and preventing lots of stress and heartache when they realize LuLaRoe is not a “business opportunity” but a giant MLM scam. Nice try, though.
Anna says
I wrote you an email explaining how your math in your article is wrong… Not just. Little bit but a lot. And you didn’t respond. I’m all for offering people a valid opinion to help them make the right choice for them, but if you’re going to be snarky then maybe you should also respond to emails.
Mrs. Bottlesoup says
Between two toddlers, a full-time job, and full-time graduate coursework, I have been a *little* busy. I’ve stepped away from my blog for a few months. Now, on my holiday weekend, I am playing catch up on comments and emails. I will get to your inquiry shortly; however, I have triple checked my math and had a few mathematicians do audits. My math is correct. But I’d be happy to go through it, step by step, with you, if you’d like.
Ali says
So you’re saying that you’re too busy to respond to an inquiry, but not busy enough to do all this math? First of all, they are not expecting you to sell at the “middle” retail level. All consultants sell at the top retail price. The profit on the clothes is anywhere from 50% to 60% a piece; depending on the piece of course. And you’re talking about “business expenses” as though it is outrageous to need supplies. You need supplies for any business. You use a computer and the internet at the VERY least to write your blog; these are not expenses? Why would you go into a this big of an investment thinking that you won’t need supplies?
Second, who in their right mind thinks that their $5500 investment is going to pay off right away? Some consultants have done it in weeks; some in months. But if you’re going into this expecting an immediate result, you’re definitely in the wrong place.
By the way, after you “pay off” your initial investment, the profit from anything else you sell goes to *gasp!* business supplies, taxes, buying more inventory, and IN YOUR POCKET, since you’ve already paid off your investment 😉
PS I think some of you need to look up the definition of pyramid scam.
Mrs. Bottlesoup says
I believe what I was saying is this blog is my hobby not my full time job. I have other things in my life that take priority, like my family, my job and sleep. I’ve posted an update to this original piece here. And, you’re lucky, because I am exhausted and have zero venom left for this comment. Have a good night.
Landon says
I have to agree with Anna. Your math is correct, but your numbers are wrong.
1. There are 4.333 weeks in a month (52/12 = 4.3333) not (4).
2. You would not multiply the 101 by the average of $18 profit because after you made back your initial investment, everything after that would be profit. Therefore, you would need to multiply the 101 remaining (which would actually be 77.6 after applying #1) by 32 (18 profit + average of 14 per piece = 32) = $2483.20 —–based off of your numbers.
3. If that chart was correct and it takes 70 pieces to make back your investment, then you would be at $0 after 70 pieces and not -$406 —if the chart is accurate.
Everything after that is incorrect. Trust me, I really wanted your information to be correct, but it’s not. I would gladly send you a spreadsheet with accurate numbers if you are interested. Let me know if you find more information please.
Michelle says
Your math may be right but you are pricing items at an average price of $18 which is incorrect as nothing from LLR sells for $18 retail. The leggings sell for $25 a pair. ($5040/280= $18)
Let’s low ball and price every item you sell at the same price point as the leggings, which are the lowest priced item the company offers.
If we sold 280 items at $25 each, your total sales would be $7000. Still making a profit over the original investment of $5500 and you’d have 101 items left to sell at $25 a piece which would give you another $2525 in sales bringing you to a total of $9525 in sales and $4025 in profit only selling the lowest price item.
It’s been reported that the average profit per item is $18, maybe that’s where you got your number from?
Nonetheless, as I said, your math is in fact correct, but you are using the wrong numbers so it’s a moot point.
Mike says
My wife is looking to get into this and wanted me to look into the financial side of this (I’m an accounting/finance major and I LOVE numbers). I started by searching the internet and your site was the first one that came up. When I read through your numbers, I was a bit alarmed that a company could get away with this. But, I continued searching and found numbers that were drastically different from yours. So, I did the math independently. Here is how I did the math: Average inventory cost is $14.43 ($5,500/381) and the average sale price is $32.81 ($12,500/381). To be conservative (like any good accountant), I rounded the cost up to $15 and the sale price down to $30 leaving $15 profit for my analysis. If you are not repurchasing inventory you would need to sell 184 pieces (184 * 30 = $5,520) to pay-off your original investment and have a self-sustaining business. That way you would cover the $5,500 (plus have $20 in your pocket) and have 197 pieces of clothing left where every remaining dollar of sales would be considered profit. However, from everything else I read online they suggest at least purchasing back the inventory that you sell. If you repurchase your inventory as you sell it, you need to sell 367 pieces ($5,550/$15) to pay-off your original investment and have a self-sustaining business. This would leave you with $5 in your pocket and inventory of 381 pieces (whole sale value of $5,500) that was paid for by the profits. The significant difference between our math is that you are double counting the cost of inventory by only using the profit ($16 in your example), instead of gross sales and then also including the purchase of new inventory. Either you need to use gross sales or remove the repurchase of inventory. From what I read online and listened to on YouTube, most sales average 25-30 pieces. My wife was thinking she would be able to dedicate enough time for one sale a week, so it would take less than 4 months to pay off the original investment and make the business self-sustaining (25 pieces per week*4 weeks per month*4 months = 400 pieces). Most start-up businesses would kill for that short of time to profitability. I also have to admit that there are several other financial variables that should be considered like other start-up costs, taxes (largely income & FICA), credit card fees, shipping costs, give-aways, etc. Being the nerd that I am, I actually built out a more complex projection and in the end came out with similar results. Ultimately, I see the financial side of the business as reasonable, not something we are expecting to completely replace an income, but definitely not as bad as your original analysis. Just thought I’d leave my 2 cents for others to consider.
Jk says
I just realized who you are. That miserable friend everyone dislikes
Mrs. Bottlesoup says
You’re so right. Everyone dislikes me. I’m just any angry, bitter, sad person. Do you feel better now? Glad I could help. Enjoy your day.
Mallory says
I guess my sisters pay their bills with air.
Your numbers are bogus and make no sense. Book keeping isn’t that complicated. Sales minus expenses. End of story.
Mrs. Bottlesoup says
Lol. Thanks for stopping by!
Carrie Detty says
Casey – Slander would mean it is false – and everything that Mrs. Bottlesoup stated – is true. In fact there are so many pages of ‘reviews’ of LLR, that the pages take the top spots on Google – before you get to the LLR Website – unless you count the paid for Advertisement Top Spot. To date there are 107 BBB complaints – 48 of which are unanswered by LLR. And no one made you read this Blog. You were not sat down in front of your computer and forced to read this Blog – please stop drinking the kool-aid. People have thrown away thousands of dollars – for nothing…
KevinG says
When reading the article it was immediately obvious to me that the math wasn’t working out. Gross sales vs net is actually a thing if you’ve ever run a business. On the conservative side, as mike pointed out the margin is still great and the profit turn is accelerated much more quickly than many other riskier business ventures when you look at the wholesale costs vs retail retail. The model is similar to every retail establishment in existence. The one thing they don’t advertise is that, as pointed out in the article, the consultant is fully in charge of their own marketing and distribution. It is no get rich quick scheme. It requires both management and sales skills. As he pointed out above it needs to be looked at from the self sustaining inflection point. Many things she said in the article are true and make sense, however ignoring the gross sales is a huge error on her part. Using her initial numbers and estimated profit of $18 per item, even subtracting a full rebuy of $5,500 you end up with an initial net of $6,858 once 381 items are sold. Of course you must subtract all other expenses including shipping, mileage, marketing material…etc. Say all that costs $2k, thats still $4858 profit at an eventual full sell through of the initial inventory, that’s a pretty good profit margin and you’d still have a full inventory to continue selling. Which would be worth another (gross $12,358) or $6,858 in simple profit.
If you are reading this and don’t realize the flawed math in the original article, most likely you’re not cut out to take on the challenge of having to run a business. If this article saves people from making a big mistake by not understanding everything it will take to succeed, then I’m glad as it will save them the heartache. But seriously the “math” used to bias the article is a bit ridiculous if you actually think about it for a moment.
Mrs. Bottlesoup says
Kevin, thank you. I admit there was an error in the calculation. I posted an update here. Please let me know what you think.
Casey stanton says
It was false. And intentionally harmful to this company.
Mrs. Bottlesoup says
The goal is to be informative to my readers. I published an update due to the miscalculation in my original post. Yes, I made a mistake in my original post. However, the facts about direct sales and MLM companies remain true. Statistically, it is almost impossible to profit from these types of businesses, and I will not be apologizing for preventing people from falling into this trap. I’ve said it before and I’ll say it again: if this was a foolproof way to earn money, the company would pay its “consultants” a salary. It doesn’t. And no, that’s not entrepreneurship, because these consultants have no actual autonomy when it comes to making business decisions. There are rules and restrictions on how they can market and sell their products.
Carol Fox says
It offered a lot of value to me. That I would have to work more then 40+ hours a week to be able to substantiate the possibility of making a dime!!! That’s what these things do. Sure you might do well…like with Avon and so forth but the bottom line is you are not going to get rich off of this and you have to continue constantly in order to be able to get the best product, because most of what I have seen people are fighting over what little bit of good stock they all occasionally get. It is spasley divided since they don’t make more then 5000 per print. Heck on Ebay they are trying to sell that magic unicorn in a perfect world that just poops skittles all over the place.They are hoping that someone will pay that magic number. Well let me tell you what…there is nothing in my life worth paying that much for. I noticed when I have purchased an item that they don’t always give you the price and then they invoice you and it’s much higher then what most people that are selling their leggings for $25…my mistake, should have asked before I said “SOLD”!!!
Sara says
I don’t think the prices are unreasonable, esp. the prices plus-size stores. A pair of leggings at Lane Bryant is more than $25.
Natalie says
I’d love for you to do Zija, too!
Mrs. Bottlesoup says
Hi Natalie! I’ll look into Zija. Thanks for the lead!
Angela says
I think that this was very informative and I feel that those of you on here trolling seriously need to get a better hobby. Anyone can look at the breakdown and math and understand the basic concept.
I feel that for the most part numbers don’t matter with things like this it’s all about marketing and whether or not you are a good sales person.
I know this post was intended to break down the cost of startup and find out if it’s a good investment but I want to point out a few other things.
First off I would be interested to know how much these companies make off people who buy in and don’t stick with it.
Yes, this is the individual’s fault, but, a company who truly believed in their product would be helping people sale and offer a small buy back option, just saying.
Next, YOU DONT CHOOSE YOUR CLOTHES. Let’s say you buy in and worst case you break even and keep the rest…..you have random sizes, prints, styles and probably a couple repeats.
Make sure you have the storage space, I would assume some people fail because all the excess stuff is annoying and they have no storage.
CONSIDER YOUR AREA. Look up average cost of living, also look up median income this can help you see if you will get top dollar, break even or end up in the hole.
Along with considering your area, think about the style of the majority.
Are there markets?
Events?
Parades?
Is the location good for pop up events?
And so on…..
Consider your style and be honest with yourself. If you like the product, you would wear it, you look good in it and have friends with different body types and maybe if different ages….ask them their thoughts. Is the product versatile or are you trying to sale leisure wear to suits?
I’m sorry but I have seen so many people trying to sale shakes, make up, knives, clothes (insert pyramid scheme here) and they don’t have information when people ask, they can’t put on make up or rarely wear it and yes; I have seen overweight people posting pictures without results and swearing by the magical weight loss abilities.
Anyways, that was a lot but my point was regardless if the math is off a little or the price point is “obscured” some of you are assuming that you will eventually sale all of the leggings and you probably won’t. There’s going to be a huge pair, or an ugly design here and there that is sold under market value. Many people will sale off the rest or give it away at a yard sale.
Just be honest with yourself.
1. Are you a salesmen
2. Do you believe in the product
3. Are you willing to give it a shot and be stuck with the rest and lose out on your money
….just saying
Don’t be having a million dollar idea on a tax refund budget. Put that money in the bank for your kids and leave it be. Teach them not to give into our “buy” society.
Last thought, if you are considering a start up JUST PICK ONE! Don’t pile stuff up or swap around then you just look desperate and you won’t be successful
Do your research
Mrs. Bottlesoup says
Thanks for your comment, Angela!
ClothesareUgly says
I just checked out LuLaRoe’s website and I have to say that the clothes are overly bright and they have Aztecs designs, both of which I find very unappealing. Aztec prints and turquoise jewelry…. Are two things that I will pass on. As to these companies operating legally makes me laugh. Most of these companies are based in Utah, “the Scam State” which has laws protecting these pyramid scheme companies and the Federal Trade Commssions lacks the manpower to go after these companies. Also, unless there are numerous consultant/consumer complaints to the Attorney General and the FTC these companies are allowed to exist because they are not high priority. I have talked to agents at the FTC and exposed another pyramid scheme companies grossly exaggerated compensation plan and was told by the FTC that they are aware that these companies do this to lure in customers aka consultants but all these companies do it. The only recourse if one becomes a victim is to report them to the FTC, Attorney General and Better Business Bureau, and perhaps the IRS. Maybe after many complaints these agencies will take notice and action. Also, don’t be afraid to tell others of your story because you could be saving someone thousands of dollars, stress and heartache.
Mrs. Bottlesoup says
Great comment! Women who have participated in these MLMs/direct sales companies should not be scared to speak up. I don’t blame women who have fallen prey to these schemes. They make it sound so good! But, I do feel like once you know it’s a bad idea, you need to speak up and help others prevent falling into the trap.
Isilzha says
I think nearly all of us have been tempted by an MLM at least once, especially when we’re young and naive. The biggest turnoff for me that kept me from falling for the scam was the cult like “training” that was mostly just cheering and chanting affirmations. Something you’re leaving out of your math, but is hard to quantify are the trade off costs of doing this versus an actual real paying job, even a minimum wage one. There’s also the cost of gas, car maintenance, office supplies, having to pay 100% of medical, taxes, inventory damage/loss (cause it’ll happen).
I’m the miserable person in the local FB jobs group who posts strong cautions for every MLM scam I see. I’m made more than a few cult members (aka, “business” owners, lol) irate for doing that.
Keep up the good work dragging these MLM scams out into the light.
Mrs. Bottlesoup says
Thank you, Isilzha! You may be interested in my update to the LuLaRoe piece here. Thanks for reading! Totally agree – MLMs are – in my opinion – total scams. Any other MLMs I should look into for the blog?
Christina says
I like your last statement. This is saving me thousands of dollars and even more stress. I signed on to become a consultant but it cost even more than just the inventory. It was going to cost me almost another $1,000 just for supplies. I noticed that the consultants I follow on Facebook aren’t selling crazy numbers. Their inventory just sits so I don’t believe that you get your money back sooner then later. Unless you can eat, sleep, and breathe LulaRoe.
Mrs. Bottlesoup says
Precisely! 🙂 Very good observation, Christina. There are lots of LuLaRoe groups, but many of them have stalled and their inventory just sits. It’s in the best interest of the direct sales model for “fashion consultants” to act as though business is booming, but in reality most women are being exploited and I’m trying to bring that to light with my pieces on direct sales and MLM companies that target women.
Tiffany says
Did you know that Lularoa will buy back your clothes at 90% of what you paid if you decide it isn’t working for you
Mrs. Bottlesoup says
So you still pay them 10%.
Womp womp.
Actually, it’s 85%. So, you can pay them 15% for not being able to sell their product, which is $750 on $5k. If their product was so fabulous, they would buy it back for 100% and sell it to someone else.
H says
Not to mention LuLaRoe pushes their consultants to give inventory away for free…A LOT OF INVENTORY. So you have to consider the cost there as well.
Elle Ludvigson says
I have to agree with ClothesareUgly. I like the comfort of their pricey leggings and some of the tops. I recently went to a show with 3 consultants. I found only ONE outfit that I liked, but it wasn’t in my size. No one else had the print! I was looking for clothes for work. I am looking for comfy clothes for work. If I showed up in some of those outfits, I’d be sent home to change. Can’t believe they have so much ugly inventory. And what’s the deal when they divvy up the holiday specific (Halloween, in particular) prints to the consultants. I found one who had crap loads of Halloween and another who got none. Not interested in consulting, but I could take that seed money and invest it in other means and get a better ROI for the future.
GoodJob says
Miss Bottlesoup you must be doing something right because I just googled Jamberry Scamberry and found that women are reposting your blog on mommy threads and warning other ladies that Jamberry is indeed a Scam! Jamberry Scamberry is so catchy and I hope more women decide to steer clear from Jamberry altogether. It’s truly not worth your time or investment. And Nailwraps being non-toxic my ass…they are made out of pvc…do your own research about this product and the nail damage and nail fungus…and ask yourself do you really want to peddle this crap to your friends and family? If yes, I hear the tobacco companies are hiring people like you who have no souls.
Mrs. Bottlesoup says
<3
Sharon says
Are you kidding?? I’ve been wearing Jamberry consistently for a year and a half. No issue with nail fungus. All the issues with nail fungus are from early on in the company’s history.
Mrs. Bottlesoup says
The nail decals are not good for your nails; by the same token, neither is nail polish.
Mer says
Well it seems you know it all…lol
Brit says
I’d like to say something about jamberry.
I’ve been selling it since March 2016. and I loved it at first. but now, I can’t stand it. honestly if I could get my money back for all of the wraps I have purchased, yes, I ended up putting more money into it than I’ve actually made just to help keep myself “active” each month.
for the 8 months I’ve been with scam berry, I have not “gained self confidence” that I didn’t already have, or “felt prettier by wearing these wraps”
in reality this company made it worse for me because they tell you to pretty much “hit up” your friends and family with these products and post in your Facebook groups every day about this product and that product and b3g1 free here and sell 33,000 PRV in order to go on a trip to Punta Cana. so after you’ve pushed all the jams down your friends and family’s throats, now they are avoiding reading messages (even if they aren’t Jamberry related messages) because they think you’re trying to sell them something, and you’ve gotten to the point where people are unfriending you because the notifications from the fb groups are so annoying, Jamberry hasn’t boosted anything but now you’ve spent $80 to get yourself past that “active” point and you’ve lost friendships, you are mad at yourself for not being able to sell those new bundle deals. you have to find a way, any way to get up to “active” next month too so you don’t lose your consultant level.
what I’m trying to say, if you haven’t figured it out, it is a giant scamberry pie that I wish I never dove into.
“wear these amazing nail “shields” that will help brittle nails grow strong”
my nails are 80X worse than before I started wearing jams.
“run your own business! be your own boss!”
I am under their microscope 24/7, because Heaven forbid I sell my OWN personal stash of wraps, I will be shunned by HO and probably booted from the company. just take a look at the P&P. you can’t do what you please with “your company” or you’re done!
“recruit! recruit! recruit!”
who? who am I going to recruit? oh. you mean the dozens of women who said no thanks to free samples, let alone purchasing anything?
yea this DS company sounds like big bucks in the beginning, promises of being your own boss and creating your own hours and selling amazing product just to make a measly 33% commission on sales if you can get them, I dumped so many hours of non stop marketing and advertising, for what? maybe a total of $300 profit (not including my own purchases) in the last 8 months.
if you want to start your OWN business, don’t do it by joining a DS company as a “consultant”
you’re not a consultant, you’re a slave. you make lousy money and you can’t even sell your own stash of wraps or lacquers without being punished.
oh, on the other hand. they do have pretty wraps, my nails take a lot of work to get them to stay but the wraps are nice, but that lacquer… chips off within hours of applying. I’ll stick to my pharmacy bought polish.
so please. save the frustration of joining scamberry, save the relationships with your friends and family. don’t buy into their scheme. you aren’t your own boss.
I wish I could go back in time and not join.
I will be hanging up my hat by December.
it’s not worth it. I promise you.
Mrs. Bottlesoup says
Brit, I’m sorry you had that experience but I’m very happy you decided to share this information with my readers. It’s best and brave to speak out against things like this; you could easily be embarrassed and hide behind that shame, but when women like you speak the truth about these companies, that’s what’s truly empowering.
Stephanie says
THANK YOU! This couldn’t have been explained any more clearly. As a fashion consultant you are not a “small business owner”, you are a CUSTOMER of Lularoe. The company is taking zero risk! They’ve sold to their consultants and made their profits. Done and done. It’s the consultants who end up stuck with hundreds of ugly, tacky, unsellable pieces after a few cycles of replenishing inventory.
It’s fine if you actually end up making a profit… Actually, good for you, you defied the MLS odds! But, think for a second and take into account how much of your time you had to sacrifice. How many hours were you logged in on Facebook?? Dressing up mannequins to take pictures of products, arranging and organizing merch, editing and posting pics, chatting with customers, answering emails, tracking sales? Finding willing hosts, loading your car to go to a pop-up, unloading your inventory and setting up your pop-up, the travel time to and from this single pop-up, the cost of snacks and refreshments to keep your friends happy as they browse your items? Time spent packing items for online orders, printing/writing shipping labels, driving to the post office? I’m willing to bet all of this work, especially the time spent on any and all forms of social media promoting, easily exceeds 60 hours per week. So break that down hourly, and it’s probably less than minimum wage in the grand scheme of things.
Time is precious, not money. I’d rather work an easy going minimum wage retail job with guaranteed part-time hours than deal with all of the above, just to play pretend that I’m a “small business owner”, who still has to answer to and play by a corporation’s rules on how I can run my own damn business. Not to mention irritating and alienating family and friends who are made to feel like marketing targets if I really “push hard for success”, because failing would be 100% my fault.
Missdaisy says
Well said
Markeeta says
Lularoe will BUY BACK any unsold inventory for 80% of what was paid…
Mrs. Bottlesoup says
Right, meaning you still lost 20% – or $1,100 of your initial investment.
made the llr mistake says
Don’t forget your cost to ship it back :-/
Alicia says
THANK YOU for this. The math is so helpful to me…to see it explained and simplified. I’ve been in the ‘queue’ to become a consultant for two months and haven’t really felt like I wanted to do it. I do enjoy the clothes, I think they’re cute and comfy. I just feel like the market is over-saturated and the initial investment is exorbitant. In addition, I’d have to invest in clothing racks, totes/bins, business cards, shipping supplies, etc.
Mrs. Bottlesoup says
Definitely! Glad it helped!
Kristy Frisco says
I was so glad to come across your comment! I, too, had been in the ‘queue’ and have been having doubts. So, what was your final decision? Did you go with it or not?
Dalena McGrew says
Wow, you singlehandedly may have changed my mind on LLR! And saved me lots of money. I do love the leggings and comfy tops though! Lol
Mrs. Bottlesoup says
Glad I could help 🙂
Aimee Barton says
Just read your review on KEEP and then saw this one too. Thanks for explaining everything so clearly. So my question is this are any of these companies actually worth doing? Is there anything that can actually help families instead of just scamming moms who are trying to do all they can.?
Mrs. Bottlesoup says
Unfortunately, MLMs and Direct Sales companies are not viable ways to earn an at-home income. The best things you can do are discover ways to save money, or learn a valuable skill that you can execute at home (like app coding, billing, professional writing, etc.).
Tiffany Fobes-Smith says
This is 100% untrue. Direct Sales companies including LuLaRoe are absolutely great ways to earn an at home income. I have tried many and they don’t all work for everyone, but hard work and dedication they do work! I have been selling LuLaRoe for 7 months and in 4 months I paid off my initial investment and have now REPLACED my full-time income, was able to quit my job and stay home with my family, and have earned a free cruise from the company. To say this is a scam is absolutely ridiculous and not true. No direct sales are not for everyone, but for some people they are! Especially if you are a hard worker and determined to succeed and find a way to provide income for your family while staying home. I have seen so many lives change by direct sales companies so this is completely a biased opinion blog. Please learn to keep an open mind and realize that not everything is for everyone, but some things are for some people and to put this idea in everyone’s head for people who are determined and have the chance to change their lives is not giving them a fair change to live their life to the fullest and learn through their own trials and errors.
Mrs. Bottlesoup says
I don’t even have to respond to this, as you’ve discredited yourself from the first sentence: “Direct sales companies […] are absolutely great ways to earn an at home income.” False.
Wendy Beam says
Mrs. Bottlesoup, that was really rude.
Mrs. Bottlesoup says
#guilty #tired #dontcare
Gerald says
Have u been in a direct sales business? If not then you have no idea if it will work. I haven’t myself either but sales is sales. I own a few retail businesses. I buy wholesale and sell retail. I profit the difference less soft costs. It’s the same in this business and others. If I were them I would make it be $5k to start as well . If a person is not willing to spend that then they are probably not dedicated enough to partner with.
Mrs. Bottlesoup says
No, I have not been in a direct sales business, but I can have more than an idea of how it works. I have actual information from people who’ve done it, the documents and contracts themselves, etc. It’s not the same in a direct sales company like LulaRoe, because in your sales based business, you have control over how you market, what you purchase, where you sell, etc. LLR has restrictions on everything that actually limit the consultants abilities to be successful. It’s sad.
Ali says
Seriously? You can slander a company, but not bother to respond to a comment that disagrees with your article? I’m pretty sure you are discrediting yourself, Mrs. Bottlesoup
Mrs. Bottlesoup says
I did not slander a company with my opinion, and since I moderate thousands of comments I have not gotten to yours yet. I’ll get to it in a couple minutes, as I see it down the line now. Thanks.
Jk says
I earn some side income but get much personal joy out of it.
Took me a minute to realize why this article irritates me so much. The reason for it is because of the blame placed on the company for making a profit. That would be for any wholesaler. No one does it for free. That’s why we live in a capitalistic country . Every company in our nation wholesaler or not is out to make a profit.
Lularoe sales people do make a profit and I am speaking from experience. and allows women to stay home with their children while making a little bit of income for their family. That’s why this article irritates me is the negativity and condescending attitude and said of the support of women and their families. The tone of bitterness just disgusts me
Mrs. Bottlesoup says
If you have found it works for you and you like it, then why are you so sensitive about defending it? Own your truth. I suspect you know it’s not as easy or profitable as you wish it was. My only suggestion in the article is that you, yes, own your own business but diversify your inventory like other retailers. That way, you’ll minimize your risk. If you took it another way, then that’s on you. Have a good one.
Bubbles says
Great job, found this on Reddit. Thumbs up! You are saving people.
Mrs. Bottlesoup says
Thank you. I’m happy to hear that! 🙂
Najel says
My close friend just started as a consultant and I feel bad for her. When I saw the clothing, I thought it was cute but when I asked her the price of a dress, my jaw dropped. $45 for a casual dress? I recently bought three dresses on sale for $30 at a local retail shop. Old Navy has awesome sales on everyday casual clothes for soooooo much less and the same quality. With so many stores like Platos closet, thrift stores, Old Navy, etcc….where you can get quality clothes for cheap, I just don’t see this asite a good investment. I wish I had read this and shown it to her before she started.????
Mrs. Bottlesoup says
Najel, I’m sorry to hear about your friend. It’s a delicate situation, now, because she’s invested a significant amount of money, but I think if you feel comfortable and have the opportunity to do so, it’s worth having a conversation with her about LuLaRoe and how they operate…before she’s sucked into ordering even more inventory to “grow her business.”
Katie S says
I have 17 friends who are now consultants and every single one of them has made their money back within 5 weeks. Working part time. 3 of them are making over $5k/month. One of them is pulling in between $11 – 13k MONTHLY. None of them has a downline. None of them harasses people to buy. Yet they make great income selling clothing in online parties. I have several items from lularoe…..the oldest 3 items look just as good as they did when I bought them when the company first launched. It’s stretchy, it covers, there’s no fraying or seams falling apart and you can’t see through it. I’d say that’s a pretty good investment.
Mrs. Bottlesoup says
Really? Tell me more about your “friends” who divulge the intimate details of their finances to you. It sounds like you’re a consultant to me.
rc says
Been reading all this.. and you make good points but lost me when you included shipping. When we send out our mech to customers… they pay for shipping not the consultant… ??? do you lost me there…. My wife is a consultant and these comments are a bit silly.. I like your math but it seems your math is for someone who isnt willing to work this like a full time business. And quite frankly… why would you not if you are going to invest that much in business.. I had a successful business for over 20 yrs online. So i have a bit of and edge on marketing.. and duh… yes , you have to be very savvy in marketing…. no kidding…..??????? im lost on many of your comments and others responding…. I liked how you broke it down but again, sounds like if you are moving smaller amounts of inventory.. you will be CRUSHED in 6 months.. i would suspect that that is what will happen to most of these fly by night consultants with LLR and other MLM’s….. have you ever heard of Mary Kay?? why does it still thrive???? Hmjmmmmmmm MLM……. amway???????? pampered chef?????????? OF COURSE YOU HAVE TO TREAT IT AS A BUSINESS.. HELLO??????? MAKES NO SENSE…
Ally says
I feel bad for you, you don’t have an open mind at all. Your so stuck on people that don’t make money that you don’t see that there are people that do. I’m not a consultant and I do have friends that are making $5000+ a month selling. And that is all profit. If your a driven individual there’s not anything you can’t do. And to avoid another snarky comment from you, yes they are my CLOSE friends who share everything with me. All your doing is putting down people. Your in grad school right? I couldn’t tell. Does that sentence sound rude? Good because every comment you make to someone who is defending Lularoe is rude. There’s a way to get your opinion across without being rude.
Mrs. Bottlesoup says
I’m not putting people down by talking about a company that drives people further into poverty.
Michelle Kezele says
Whoa! Mrs Bottlesoup! You need to calm down! You’re losing credibility faaaaaaast. Chill out! You’re driving me nuts.
Mrs. Bottlesoup says
I have been driven nuts by these comments. I should probably just stop blogging and sit in the corner. Not.
Kelly says
You sound like a broke bitter person. I know several people doing well with LLR…one just bought a new house.
Mrs. Bottlesoup says
I’m not broke or bitter. My post isn’t hostile in tone. If you’re inferring that, it’s on you. Have a nice day.
Carrie Detty says
the funniest part of comments like Kelly – is that it is so easy to see that in actuality she is trying to convince herself. She is totally a Consultant.
Patty says
I recently met my FIRST LLR consultant who just started 3 months ago. She invested her $5 or 6K, 6 clothing racks ($75 each), baskets of leggings (at least 7 of them), and had those hypnotic circles in her eyes when she told me how GREAT it was going… One girl walked out with ONE shirt at this show. It’s swap meet clothing that an 8th grader in 1970’s home-ec class could have made, and the fabric is low-quality, the prints are horrific overall, and when you put ANY price-point over $25, it’s now ridiculous. They have a BBB rating of F in California. Simply go to the BBB on Google and read. Nothing here is slander by Bottlesoup. They started out with some fun leggings, and the founding couple have gone on to the the Jim and Tammy Faye Bakker of the home-business industry, imho.
Mrs. Bottlesoup says
Thank you, Patty. How is your friend doing? I’d be happy to help tell her story if she wants to share.
Bob says
I doubt they know how to track their profits accurately after all their costs. Most friends who start this type of business don;t know what the bottom line is until it is too late.
Jackie P says
I agree 100% with you Katie S. BOTTLESOUP you have no idea what you are talking about! I have 4 friends that also sell and they tell me all the time what they are making!! It’s also not a pyramid scam people. No one is under them and no one needs to sign up. I’ve never been bothered by any of my friends to sign up, they get nothing from me by having me sign up so get you’re facts straight!
Mrs. Bottlesoup says
I had my facts straight. I made a miscalculation. I updated here. I’m going to keep writing my blog, but thanks for sharing your opinion. I definitely had a laugh.
Susan says
I have purchased a few LuLaRoe items, and now deeply regret it. I bought a kimono from them, and paid over $40- regret city- because I found an even better one, made out of ORGANIC cotton, on Etsy, for LESS! Which I will be buying! Most of their clothes are made from polyester, which is a hormone disruptor- so don’t live in it if you do have polyester clothes, and most of their clothing is made outside of the USA. They do have some pieces being manufactured in the US, out of fabric made elsewhere, but those pieces are dry clean only! ARGH! I don’t want casual clothing to have to be dry cleaned, it adds to my expenses! I will probably keep the few items I own, but will never buy any more… also, the darn Randy shirts pill up like there is no tomorrow. I seriously considered becoming a consultant, so I sat down with my husband and ran the numbers. This article is spot on! YOU, the consultant are their customer. The mark up is insane! You DO have to continually take the money you’ve earned from reselling the items and pump it back into your inventory. The fact that you have zero control over your inventory patterns is crazy! Some of their designs are just plain old ugly. I know, I know, there’s something for everyone. But I do know some consultants who *still have some of their original pieces* because they just don’t sell.
Quote from an article about the chemistry of polyester, “Researchers at Tufts Medical School noticed that cancer cells being grown in the lab multiplied more quickly in polyester test tubes than in glass. It appears that polyester slowly emits phytoestrogens, which are endocrine disruptors, or compounds similar to estrogen, which can promote certain types of cancer. Enough people are worried about these chemicals that entire conferences are being held to discuss their possible effects. You can see the concerns of the scientific community reflected in this list of topics at a conference being held as we write: http://www.grc.uri.edu/programs/2002/enviend.htm” Find the article here http://www.diaperpincorner.com/2000/04/artificial-materials-cloth-diapering/
Yes, this is an article about diapers, making your own, etc, but the chemistry is sound.
Here is another quote, “Polymer Chemistry 101
It is probably a good idea at this point to back up a bit for some chemistry 101. Basic polymer chemistry isn’t too complicated, but for most people the manufacture of the plastics that surround us is a mystery, which no doubt suits the chemical producers very well. A working knowledge of the principles involved here will make us more informed users.
Polyester is only one compound in a class of petroleum-derived substances known as polymers. Thus, polyester (in common with most polymers) begins its life in our time as crude oil. Crude oil is a cocktail of components that can be separated by industrial distillation. Gasoline is one of these components, and the precursors of polymers such as polyethylene are also present.
Polymers are made by chemically reacting a lot of little molecules together to make one long molecule, like a string of beads. The little molecules are called monomers and the long molecules are called polymers.
Like this:
O + O + O + . . . makes OOOOOOOOOOOOOOOO
Depending on which polymer is required, different monomers are chosen. Ethylene, the monomer for polyethylene, is obtained directly from the distillation of crude oil; other monomers have to be synthesized from more complex petroleum derivatives, and the path to these monomers can be several steps long. The path for polyester, which is made by reacting ethylene glycol and terephthalic acid, is shown below. Key properties of the intermediate materials are also shown.
The polymers themselves are theoretically quite unreactive and therefore not particularly harmful, but this is most certainly not true of the monomers. Chemical companies usually make a big deal of how stable and unreactive the polymers are, but that’s not what we should be interested in. We need to ask, what about the monomers? How unreactive are they?
We need to ask these questions because a small proportion of the monomer will never be converted into polymer. It just gets trapped in between the polymer chains, like peas in spaghetti. Over time this unreacted monomer can escape, either by off-gassing into the atmosphere if the initial monomers were volatile, or by dissolving into water if the monomers were soluble. Because these monomers are so toxic, it takes very small quantities to be harmful to humans, so it is important to know about the monomers before you put the polymers next to your skin or in your home. Since your skin is usually moist, any water-borne monomers will find an easy route into your body.
Polyester is the terminal product in a chain of very reactive and toxic precursors. Most are carcinogens; all are poisonous. And even if none of these chemicals remain entrapped in the final polyester structure (which they most likely do), the manufacturing process requires workers and our environment to be exposed to some or all of the chemicals shown in the flowchart above. There is no doubt that the manufacture of polyester is an environmental and public health burden that we would be better off without.
You may not feel comfortable putting a potential endocrine disruptor next to your child’s most sensitive areas. What about some of the other fabrics and fabric treatments used in cloth diapering?”
Check out out! I know, we’re not talking about diapers, or babies, but I know I sometimes wear my leggings commando to yoga… I know there are others out there who do to. I won’t be wearing any more polyester clothing next to my bare skin, ever. I have removed it from our household in order to prevent our tween from having premature adolescence, as is so very common now a days! (probably from all the chemicals in the water, food, fabrics, etc in our lives.)
Mrs. Bottlesoup says
Thank you for your comment! Yes, Etsy has some great alternatives. Etsy does have it’s own limitations, but it’s much better for small business owners than LuLaRoe, which is a direct sales company, not a small business supplier. Thanks for stopping by and sharing 🙂
Ebony Arts says
Do you own any LLR??? I do, and none of the items i have say dry clean only
Sarah says
Not to mention they are made in China so guess what I did …. found lularoe dupes on Amazon made from the exact material and they are 11.99 ! Same factory too . Screw LuLu!
Math Doesn't Add Up says
There’s one major problem with your numbers. You say that after you’ve sold your initial inventory you are out of products to sell. But you aren’t. The average $18 profit is what you make after the cost of the product..after you’ve reordered that item at wholesale.
So after you’ve sold all the items and made that money back that you quoted at 1 month, you should have reinvested the remaining $ and have a fresh new inventory to resell.
I’m not a consultant, but I have a retail store and this is exactly how my business works. You purchase wholesale inventory up front, sell it at retail and keep the profit. I don’t understand how you view this as a scam?
Mrs. Bottlesoup says
No, my math is correct. Please re-read. If you still need clarification, please email me and I will give you a call and go through this step by step with you.
Jack the Banker says
Your math is wrong Mrs. Bottlesoup and now lots of other people have called you out on it even though you never approved my initial postings months ago. Have some humility to realize you are wrong and correc it.
Mrs. Bottlesoup says
Thanks, Jack. I posted an update here.
Exactly says
Exactly. Thats the issue with the math. My bet is she knows it too (at least by now).
She says she ran the numbers by mathematicians. Lol… who? This is basic business math.
She has missing money equal to the purchase price. Either that is money she slated for the automatic reinvestment (meaning like you said you have a whole new set of merch to sell), or the money was swept under the rug b.c thats where she wants it for her misleading numbers.
OR she said “repay your investment” when she really meant “double your money”. To me, and most readers, these are different concepts.
I dont disagree with the theme of her post, but the numbers she uses to prove her point need to be corrected.
Mrs. Bottlesoup says
I agree there may be an issue with the way I presented the math. I have to dig up the spreadsheet and numbers and review. Apologize for any confusion.
Amy says
It isn’t that hard to recorrect the math. You presented the math in a way which appears to show the reader that you make next to zero if you sell all the clothes. You forgot to take into account that the customer pays more than wholesale cost meaning everything above that is profit.
381*18=Profit not revenue
Mrs. Bottlesoup says
My intention was never to be misleading. It was a simple matter of miscalculation. I deducted the investment twice. I posted an update here.
Amy says
But you refuse to update it on the page with the most traffic. The update is commented way far down in the comments, meaning most people will NOT see the updates math.
Mrs. Bottlesoup says
Wrong. There is a link above the fold, before my post starts, to the update.
Lauren says
While I won’t lie the thought of selling LLR has crossed my mind; being a plus sized woman (though smaller, but still 14-16). One of the more trendier stores I shop at is Torrid, there is also Lane Bryant if you want more true to size clothes. Now while Torrid is the trendsetter by far, LB has definitely had it’s grandmom moments as of late. When I compare to plus size lines at major department stores like Macy’s, Jc Penny’s, Sears (though the new Emma line has gotten my interest) to the Charlotte Ruse and Forever 21 (easiest way to make someone who is plus feel 10’s bigger since their clothes run small!). LLR appeals to me as a true customer, not a consultant for how the items fit and slim me down. I do tend to go for the plain ones and every once in awhile a crazy print. what I am finding that keeps me a customer is the fact that I can go into Torrid or LB and spend more on similar items, but they have a lesser sustainability. Plus size clothing is already pricier than most and so when I compare the prices to what I already pay (outside the CR and F21 spectrum), the price is comparable. I am literally in groups with 18k and 20k women who show their style, their customization for this versatile line. I support my friends who sell and get what makes me happy.
I’ve known 3 consultants (and 2 more who are awaiting inventory) that have paid off their initial investment, debt, vacations, student loans – because inside the Facebook group world… you would be SHOCKED at how these women go nuts for the clothes. So while being a consultant may not be for one person, it is definitely changing the lives of many. I think it’s what works for you at the end of the day and i’m a happy customer as of right now since I have clothes that cover the parts that need to be covered and slim me down. I did enjoy the article and it helped me understand ALOT about the onboarding process..
But just wanted to give a different perspective.
Mrs. Bottlesoup says
I’m aware that women go nuts for theses clothes, and I appreciate your comment. However, as a business model, LuLaRoe is not sustainable. I’d love for women truly interested in retail sales and fashion consulting to branch out on their own by diversifying inventory and starting their own shops where they make the rules. Feel me?
Deanna says
Mrs. Bottlesoup – your article has provided excellent perspective for me AS I STILL PURSUE BECOMING A CONSULTANT! It’s crazy, I know.
I am compelled to comment on this particular comment. I agree with you that going out on your own would be great. However, from my perspective, LLR just makes it easier for me to get going – in a market that people are ready to buy in! And, as a plus size woman, I want to create opportunities for other women to buy clothing that accentuates rather than looks like crap. And it’s true – their clothes really do accentuate rather than make me look like an old frumpy mess.
What Lauren said above is precisely why I fell in love with the clothes and why I want to provide the opportunity for other women to buy as well.
I hate MLM. I hate direct sales. But as you stated early in your article – I will be retailer. And I realize it will be a ton of work. You have to admit that the business model is different than other MLM/Direct Sales companies.
LLR is creating clothing that plus size (and reg size) women feel good in – while the industry is lacking:
http://www.scarymommy.com/tim-gunn-designers-refuse-make-clothes-fit-american-women/
I am not trying to change your mind. And I completely agree that your math is right. I’ve done the math myself. Your article actually helped me to come to terms of the reality of this business. But I want to continue regardless. I’m happy to report back, success or fail, another time.
Thank you!
Signed,
Not-a-consultant-yet-and-not-trying-to-build-my-downline
Mrs. Bottlesoup says
I do love that article and Tim Gunn.
Ian says
So it seems your math is wrong. You are doing the math based on the profit per item, not the actual sales price. If you buy the package for 6k with 381 items. Each item ends up costing roughly $15. If you sell them with an $18 markup, you gross $12,500. Pay back the 6k initial buy in and made a profit of 6.5k. If you take 6k and buy more, you are still in the black 500. I do agree with you though that there is no way you will make 18 profit per item. My wife has asked me to run numbers to see if this is a viable business. I’m skeptical but still pulling data together from a few consultants we’ve met. My background is financial and business consulting. I’m leaning towards scam, but I’m all about the numbers.
Mrs. Bottlesoup says
My math is correct. Please re-read.
Mandy Peterson says
Just because you say your math is correct, doesn’t make it so.
Mrs. Bottlesoup says
That’s true. But it actually *is* correct. Thanks.
David Joosten says
I am not a consultant, but have a background in corporate retail and Business Intelligence and have reviewed the risks and potential of LuLaRoe.
Here is why so many people think your math is wrong… If you assume a noob would sell 280 items in the first month for $18 each, they would take in $5,040 Gross revenue. The average cost of items is $5,500 / 381 items… for average cost of $14.44
No consultant for LuLaRoe is selling their items with a $3.56 average profit per item… I understand the LuLa in Love chart differently… let me explain:
From the Lula in Love chart, NET PROFIT (the $5,040) is the amount of money you pocket after you figure in the COST of goods sold (280 items = $4,200 in this example. Your GROSS SALES are $9,240 in this example (using midpoint of high/low retail value, directly from the chart). This leaves you a PROFIT of $5,040 after you factor in your COST OF GOODS. Now this doesn’t include other expenses such as Shipping, marketing, display, storage, etc…
The error you are making in your calculation is that you assume in the example that the PROFIT somehow has to pay for the inventory… PROFIT is GROSS minus EXPENSE… in this case your TOTAL SALES $$ (Gross) minus the proportioned COST of the ITEMS SOLD is your total PROFIT.
The example assumes 280 items sold in 1 month at an average cost of $15. Mid retail price point assumes $18 profit per item. Mid retail price point assumes $33 price tag average…
280 x $15 = $4,200 of product cost (Recall that 381 items cost roughly $5,500)
280 x $33 = $9,240 of cash in
Based on this simplified math, if you invest/spend $5,500 to start with LuLaRoe, if the average item sold has a suggested median Retail Value of $33, you would need to sell 167 items to recoup your investment. 167 x $33 = $5,511
For reference, my former company had apparel lines that they owned the manufacturing license. A $40 MSRP polo shit had a manufactured cost of $10. The Landed Cost to my company(retailer) was closer to $12. The typical Sale price of this shirt $25 to $35. LuLaRoe appears to be inline with these Cost/Margin ratios for what it’s worth.
The risk with LuLaRoe is similar to other retailers… you buy inventory with no assurance it will sell. You also are subjected to re-order minimums on a monthly basis. If someone is considering this as a business, it requires personal capital, storage space for inventory, and a strong desire to work 20+ hours a week… you will otherwise be on the hook to keep buying more even if you aren’t selling much. I think the biggest issue in the math that LuLa in Love m