I know you must be wondering if you can make money selling women’s clothing with LulaRoe MLM? Let’s just say there seem to be a few problems with this company at this time.
With the straight facts, I’m going to help you decide if LuLaRoe will be the right business opportunity for you.
What is LuLaRoe
- LuLaRoe is a MLM company in the women’s clothing industry. It was founded in 2012 by DeAnne and Mark Stidham
- They have a BBB rating of B-, and are not accredited by the BBB
- They have around 20,000 distributors (down from 80,000 at one time)
- There is currently a class action lawsuit against LuLaRoe for unfair and deceptive practices. The state of Washington sued them around 2017 for operating a pyramid scheme. Also at least one other lawsuit regarding poorly made products is outstanding. They also have hundreds of BBB complaints filed against them regarding products and customer service.
Is LuLaRoe a Pyramid Scheme?
According to Wikapedia, a pyramid scheme is basically defined as a business model that recruits members by promising payments for enrolling others into the business, without purchasing products or supplying investments.
They were said to draw consultants in by promising high profits and promising the ability to return any unsold merchandise purchased. One of the main complaints by consultants was that they were not able to return unsold purchases as promised.
A business opportunity becomes a pyramid scheme when the main business income comes from recruiting others, rather than from sales of products or services.
The state of Washington pointed out that the top earners were making monthly bonus checks up to 12 times higher than their merchandise sales. It was more profitable to recruit others who would make inventory purchases, rather than sell to individual consumers.
This lawsuit caused LuLaRoe to change their compensation and bonus structure in July of 2017. A LuLaRoe executive admitted the change was made to get away from being a pyramid scheme.
Where is LuLaRoe in 2020?
The company is still active in 2020 and the owners continue to hold out hope to pull out of the lawsuit problems.
I can state right now, I wouldn’t recommend getting involved with this company at all. There are too many questionable issues surrounding LuLaRoe right now, such as:
- The huge drop in consultants tells me the company doesn’t treat their consultants very well
- The cost to join is extremely high, compared to other MLM’s
- The startup kit is pre-selected for you, so you may get sizes and styles you’re not going to be able to sell
- The quality of the clothing is poor and over-priced
What is the Cost to Join
You become a LuLaRoe consultant by purchasing $5000-$6000 of inventory to start and then you must continue to purchase a minimum inventory amount every month.
What is the Opportunity
I really don’t think there is an opportunity with Lularoe at this time. There are less expensive and easier ways to make money.
A BETTER OPPORTUNITY
There is a way to make extra money that is less intense and won’t cost an arm and a leg. I can show you how to have a money-making website like this and be able to quit your day job. It’s free to join and no credit card is needed. Check out “HOW TO QUIT MY DAY JOB.” You’ll get a website, training and 24/7 support to ensure success!
All the bad stuff you might have heard about Lularoe is true. I would say unfortunately, it is still a legitimate business. However, I can’t see anybody being able to make a decent income with the company. In my personal opinion, I don’t see it being a viable company in the near future.
Selling products through direct sales can be lucrative if you’re friendly or have a large network of friends and family. However, if like this company, the products are expensive, and it has a questionable reputation at best, it will be hard to sustain any kind of profitable sales levels.