In a multi-level-marketing business like Mary Kay Cosmetics, nothing says “pyramid” like seeing the real numbers of just how few people are making the “big bucks,” as compared to how many are really not making any money at all.
While the United States does not require nearly enough disclosure from multi-level marketing companies like Mary Kay, fortunately, Canada does.
As a result, according to Mary Kay Cosmetics’ newest “earnings representations” posted on the company’s Canadian website (view last year’s earnings breakdown here), one can see the reality behind Mary Kay’s slogan of “enriching women’s lives.”
The reality is, according to Mary Kay Cosmetics itself, of the over 36,000 members of the “independent sales force,” only a handful made in excess of $100,000 in commissions in 2013.
Moreover, less than half (47.5%) of the 4,005 who stayed in Mary Kay for more than a year and who made commissions made in excess of $100.
If that weren’t bad enough, of “the top two percent” of Mary Kay’s Canadian sales force (the “independent sales directors”), if they relied on their commissions to feed their families, it would appear more than half fall below the Low Income Cut Off in Canada, which is $21,359 (after taxes).
- Note: In the U.S., this would be called “falling below the poverty line“.
In other words, more than half of Mary Kay’s Canadian sales directors did not make a “living wage” last year through their commissions.
While some Mary Kay predators could make excuses for this, the fact is, these are not the “Executive Incomes” that many were sold on making if they joined Mary Kay.
So, what about those so-called “Mary Kay executives?” Only 12 out of 20 made more than $100,000 in commissions last year. Eight made less than that.
- Note: It should be noted that these numbers are commissions, not income from sales. However, as many former Mary Kay consultants and directors will attest to, to earn commissions in the first place, consultants and directors often purchase inventory in order to maintain “production” that ultimately ends up on their personal shelves.
As a result, as these numbers also do not reflect the cost of running individuals’ “businesses,” nor time spent, the amount of credit card debt accumulated to maintain production, it is unknown whether the individuals were actually in positive cash flow or whether they actually lost money during the reporting year.
Here’s the numbers breakdown, according to Mary Kay:
In 2013, there were over 36,476 members of the independent sales force of Mary Kay Cosmetics, Ltd. in Canada. Of the 4,005 who were in the independent sales force for at least one year and who earned commissions, 47.5% earned commissions in excess of $100. Of the 535 of those who were Mary Kay Independent Sales Directors, the top 50% earned commissions during the year of $18,610 to in excess of $100,000. Of the 20 of those who were Mary Kay Independent National Sales Directors, 60% earned commissions during the year in excess of $100,000. [Emphasis added.]
The bottom line is this: While Mary Kay still runs on the slogan “enriching women’s lives,” it still appears that the only ones being enriched are those at the top of the pyramid—and, of course, those at Mary Kay Cosmetics’ corporate headquarters.
Here is a breakdown of last year’s numbers: