Fire Sale! How Mary Kay Burns Consultants by ‘Confidentially’ Announcing Product Changes

Can you imagine being recruited into a multi-level-marketing company, being convinced with high-pressure tactics to put your family in debt by ordering $3600 worth of inventory (on a credit card) by your “recruiter,” only to find out a couple of months later that the MLM had announced it was phasing out several of the products and changing the packaging on others?

Worse yet, your recruiter knew that you were buying inventory that was going to be changing. Would you be upset? Would you suddenly have ‘negative’ thoughts? What do you do? Should you send back your inventory and lose 10% of your money? Should you hold a sale and try to get what money you can for your now-obsolete inventory–even if it means not making all the money your MLM recruiter promised you?

everything must go sale

Well, in August, Mary Kay Cosmetics is apparently introducing new products, phasing out certain other products and changing the packaging on others (while keeping the formulas the same).

What does that mean to those who have already bowed to the pressure and spent hundred or thousands on their “inventory?”

Of course, Corporate is telling their sales directors about it now and those sales directors may or may not tell their targeted “prospects” about it as they convince their targets to put their families in credit-card debt by “stocking their stores” with inventory.

Before getting into the specific product changes that Mary Kay Corporate is ‘confidentially’ announcing to its sales directors, let us quickly review some facts:

  • As a $3 billion cosmetics wholesaler, Mary Kay Cosmetics only tracks the wholesale sales it makes to its sales force–not the end retail user.
  • To Mary Kay Cosmetics, the end user is the 2.4 million women worldwide who are its sales force.
  • According to Mary Kay, 70% of its revenue comes from its international market–meaning $2.1 billion of its sales are from outside the U.S.
  • In the U.S., there are 600,000 Mary Kay consultants–2% of those are sales directors (12,000) and only 600 National Sales Directors worldwide.
  • In the U.S., based on a 2006 letter Mary Kay Cosmetics sent to the Federal Trade Commission, the company experiences 68.9% turnover annually.
  • In Canada, according to Mary Kay’s website, more than 88% of its sales force turned over in 2012. Of the remaining 3,967, less than half made more than $100 in commissions.

Additional information about Mary Kay product changes:

Mary Kay Product Changes Page 1

Mary Kay Product Changes Page 2

Mary Kay Product Changes Page 3

Mary Kay Product Changes Page 4

To make matters worse for the Mary Kay sales force, several of the products are not really changing. In fact, according to the product change brochure, the ingredients are “the same exact formula,” except that it is being repackaged.

Mary Kay Product Changes Close Up

So, to the newly-recruited consultant, with all those product changes coming, do you:

  1. Put your family further in debt by ordering all the new product?
  2. Hold a 50% off sale in the hopes of making the money back that you’ve invested?
  3. Return your products for the 90% “buyback?”
  4. Call your director and express “negative” thoughts?
  5. Or, do you stay in the Pink Fog continuing to believe that Mary Kay is not harming you and your family?

Just curious.

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