Is LuLaRoe A Pyramid Scheme – “Is Lularoe Going Out Of Business?”

Coffee TalkI’m TQ, a mom and owner of this successful Writing Business.
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I heard Lularoe is going out of business.

Are you sure? That’s a billion dollar company.

Correction… you should say… a Billion dollar pyramid scheme!

What all the hates for LuLaRoe?

Aren’t you a LuLaRoe fashion consultant?

Was… my friend… was?

What happened Lis?

I quit… But, I didn’t get the 100% buyback of unsold items.

I got a 90% refund, and… had to pay my own return shipping costs.

I thought LuLaRoe offers 100% buyback policy.

Again… had… my friend… had… They changed this policy.

Many consultants quitted over this change.

That’s why I am singing… “LuLaRoe is going out of business!”

But… you didn’t tell me why you left LuLaRoe, Lis?

I’ll tell you why…

Why I Quit LuLaRoe? LuLaRoe Is A Pyramid Scheme!

Lis… I told you LuLaRoe is an mlm when you wanted to become a LuLaRoe consultant.

It’s not easy to make money with an mlm opportunity… But that doesn’t make LuLaRoe a pyramid scheme.

OK, explain to me why Washington state brought a lawsuit against LuLaRoe for operating a pyramid scheme?

And… newspaper everywhere reporting LuLaRoe is having financial problem and might go out of business.

A company with financial problems doesn’t mean… it’s a pyramid scheme.

But… who cares… I want to know why you quit selling LuLaRoe?

I didn’t make any money…

All I have today is a big debt… Thanks to LuLaRoe!

Lis expression change… I could see the sadness on her face.

Lis is my high school friend… Yes, we know each other that long!

I sat next to Lis and tried to comfort her.

You don’t have to tell me if you don’t want to.

I want to tell you everything, TQ… Maybe, this will help me feel better… I know… I am stupid…

No, you are not… you are not…

It all started when I asked you… Lis begin…

How To Become A LuLaRoe Consultant?

I loved the LuLaRoe so much and ignored all your business advice.

I should have known… this LuLaRoe is a pyramid scheme, a scam!

When I started my fashion consultant business,

To become a LuLaRoe consultant, I was required to purchase one of the three LuLaRoe startup packages, which range from $4,812 to $6,784.

Do you know what’s in those startup packages?

Preselected LuLaRoe clothing… You didn’t even get to choose this stuff… I had to sell what they sent me.

Do you know how difficult to sell LuLaRoe?

I sat there in silence listening to Lis…

It’s not easy to sell all the inventory that they sent… You could never sell all your inventory.

On top of that, every month you must order a minimum of 33 pieces to remain active.

Unsold items were adding up… until I realized, I had thousands worth of unsold inventories sitting in my house.

Why can you sell them online?

Most unsold inventories are not hot, hot items… to sell them, you have to offer below wholesale price… You’ll take a big loss.

I never thought about the inventory problem until I became a LuLaRoe consultant.

Most new consultants think… Oh, $5,000 to $6,000 to start a business is inexpensive. But, the inventory…

Do you know LuLaRoe want consultants to carry $15,000 to $20,000 worth of inventory at all time?

They asked you to take out loans to buy inventory… That’s how I got into debt.

I rubbed List shoulder to comfort her…

Did you earn any money as a LuLaRoe consultant?

Yes… very little… not enough to feed me!

But… I saw Lularoe Compensation Plan,

That LuLaRoe compensation plan was garbage… Lis interrupted me.

They told you that you can earn 35% to 50% on retail sale as a LuLaRoe consultant…

But guess what…

Less than 10% of my inventories were sold at retail price… Most of the time, I had to sell a few dollars over wholesale.

Now, if you add in the costs of operating the business, like those in-house parties… I earn nothing!

Don’t forget the unsold item… There goes my profit… Lis laughed.

I’m telling you TQ, that LuLaRoe compensation plan is set up like a pyramid scheme… Only the top few get rich, the rest of us living in debts!

Remembered you told me to ask for the LuLaRoe income disclosure statement?

I didn’t… not until I got a copy of LuLaRoe 2016 Income Disclosure Statement… Oh boy, what a surprise!

Over 72% of LuLaRoe consultants did not receive payment from LuLaRoe in 2016… The fortunate few, 28%, received an average earning of less than $3,000.

How can you live on $3,000 for the entire year?

At that moment, I realized, LuLaRoe is a pyramid scheme… I could never make money with this company.

What happens to your downline, now?

What downline? They all left or went out of business before me.

Did you see the LuLaRoe recruiting model?

If you see it, you agree with me LuLaRoe is a pyramid scheme.

Lis… I gave you a copy of the LuLaRoe compensation plan… So yes, I had seen it.

OK, then…

Did you know that a LuLaRoe consultant has to purchase 175 clothing pieces to receive 5% downline commission?

Really? I didn’t know that!

Yet! Everyone only looks at 5%… But not the requirement to earn that 5%.

So, if I bought 175 pieces at, let’s say, $15 a piece… I spent $2,625.

Now, if I recruited a new consultant who purchased the most expensive startup package, $7,000… at 5% commission, I make $350.

Spending $2,625 for $350 commission… I’m really stupid!

You are not stupid, Lis… You just didn’t know.

Anyway… It’s all my fault… I should have known LuLaRoe is a pyramid scheme.

Lis, you keep saying… LuLaRoe a pyramid scheme, but I believe you mean… LuLaRoe is a scam.

What’s the difference, TQ? And don’t give me that FTC guideline stuff… LuLaRoe is a pyramid scheme and a scam!

But, what makes you believe

LuLaRoe Is Going Out Of Business.

I am not the one saying it… I read in the news

The many lawsuits, debts, and consultants quitting left and right… including the top consultants… have caused financial trouble for LuLaRoe.

If LuLaRoe is going out of business, I feel bad for all the consultants… They lost everything.

That’s another risk of starting an mlm business… I learned this on my own… not from you TQ.

I can see that, Lis…

Yes… Lis continued… A lot of LuLaRoe consultants lost everything… all the hard work put in to build a successful business…

TQ, you should write and tell your readers never start an mlm business… You never own a real business with mlm opportunities.

With mlm, the moment the parent company goes down… So is your dream.

It is not like owning your own business…

TQ, I should have followed you and start an online writing business.

What stops you?

I have to service a debt…

Well, you can start learning to become a writer part-time.

Do you think I can make good money as an online writer?

Lis, you know how much I make as a writer… Why you even asked?

As a writer… you can pay all your debts and still have millions…

Heh… I didn’t know you’re a millionaire!

Lis and I laughed so hard… We forgot all about…

LuLaRoe a pyramid scheme!

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