How much can you earn with Stella & Dot?

How much can you earn with Stella & Dot?

Analysis of the 2017 Income Disclosure Statement

“The earnings represented herein are not necessarily representative of the income, if any, that an Independent Stylist can or will earn. There is no guarantee that any Independent Stylist will earn any income.”

Stella & Dot 2017 Income Disclosure Statement

This is a little weird to see after scoping out their website and seeing a tool on “see how much you can earn,” reading the FAQ, and learning about the “jobs” that Stella & Dot has created. There are actually little disclaimers all over the website pointing to the income disclosure. The FTC has provided guidance to help companies ensure they aren’t being misleading to folks.

However, digging into this disclosure we find that lots of Stylists aren’t receiving any income at all from Stella & Dot. 62% of Stylists didn’t receive a check in 2017. The company doesn’t pay by the hour, this isn’t a job or source of income in the way most people might think. Stylists pay for a starter kit and then are paid based on commissions for the sales they make (or the sales of the Stylists they recruit). Most people get paid a modest amount (if they get paid). Career level pay is super duper rare.

In order to start selling with Stella & Dot you must purchase a starter kit.
This is one of many costs and expenses to consider in order to evaluate profit.

Also, numbers in this disclosure statement are all ‘payments’ or ‘income.’ None of the numbers indicate profit. Always look at profit (or profit potential) when evaluating business opportunities. Profit is revenue minus expenses: the money coming in minus the money spent. This disclosure only shows money paid by Stella & Dot, it doesn’t show what Stylists must spend on their business in order to earn these figures. Costs can be pretty high. Most direct sales participants report costs being hundreds or even thousands annually.

Percentiles, Highs, Bottom, and Top

The “Bottom 25%” of participants is explain to mean the lowest 25% of folks at that rank. This means that the average annual estimated income reported is the most that anyone in that quartile brings in.

Specifically, at the Stylist rank, the bottom quarter of folks make between $0-200. The top quarter all make more than $1,800. We can clarify this a bit to be:

Rank% of Paid Stylists2017 Income Range
Stylist (Bottom 25%)18.48%$0 – $200
Stylist (Middle 50%)36.95%$200 – $1,800
Stylist (Top 25%)18.48%$1,800 – $43,800

The average over this rank is $1,400 which means that there aren’t very many people making those higher pay-outs. It’s probably very rare and just a few people. It’s much more common in this group for the estimated annual average to be hundreds of dollars.

What about higher ranks?

Like most multi-level marketing companies, the big money is paid at the higher ranks. This means, to earn the most money you need to recruit others to sell the product. Very few people advance to these higher levels. A little over 89% of participants are in the first three ranks.

Rank% of Paid Stylists2017 Income RangeAverage for rank
Stylist (Bottom 25%)18.48%$0 – $200$1,400
Stylist (Middle 50%)36.95%$200 – $1,800$1,400
Stylist (Top 25%)18.48%$1,800 – $43,800$1,400
Lead Styist (Bottom 25%)1.28%$0 – $400$1,600
Lead Stylist (Middle 50%)2.55%$400 – $2,100$1,600
Lead Stylist (Top 25%) 1.28%$2,100 – $15,100$1,600
Associate Stylist (Bottom 25%)2.53%$0 – $900$3,600
Associate Stylist (Middle 50%)5.05%$900 – $4,800$3,600
Associate Stylist (Top 25%)2.53%$4,800 – $28,300$3,600

All of the others make up just 11% of the folks who are paid (or about 4% of all Stylists, paid or unpaid) Stylists in 2017. Even though they make up most of the disclosure they represent a very small number of people and their earnings are certainly not typical. It’s really rare for people to be paid an amount that would be similar to a job even before considering expenses.

Annual calculations

The notes remind us that stylists don’t necessarily make commissions every month. However, the estimates in the table take monthly averages of many stylists and then estimate what income would be annually assuming a check every month.

If Stella & Dot were to take actual average annual income of stylists they would be lower. This is because any analysis that did include months where stylists recieved $0 would be lower. We can’t figure out how much lower without knowing more about how many stylists each month recieve $0. We can only conclude that the averge income from actual stylists is definitely lower than those reported in this disclosure.

Stella & Dot does report that around 62% of Stylists in the United States didn’t recieve a comission check at all during 2017. Because they didn’t receive income, none of those thousands and thousands of participants are taken into account when describing the average income disclosed here.

Finally, the Stylists at many ranks have likely worked for more than just one year to reach their rank. They have invested a lot of time, energy, and money to reach their level. This isn’t captured, and there is no disclosure about the time to reach each of the ranks.

Conclusion

It is best to view the amounts in this Income Disclosure statement as over-estimations. There are known costs and under estimates that will lower the actual averages. It’s likely that many of the folks at the ranks described actually lost money selling Stella & Dot jewelry once they factor in costs and expenses: driving, tax preparation, their time, childcare, party prep, etc.

According to their own income disclosure, annual earnings of $43,000 (or monthly of $3,600) is at best very rare and there is no evidence for the claim of 5-10 hours per week.
The income disclosure estimations do not take into account costs and expenses.

Here are some suggestions about topics for more questions when doing more due dilligence on the Stella and Dot opportunity:

  • Costs and expenses
  • Requirements and time to reach various ranks
  • Time investment

For all questions about the opportunity, be sure to ask for data about most participants, typical participants (medians, averages) rather than anecdotes and information about the most successful participants.

No affiliation with Stella & Dot. Please contact us with corrections or questions.
Source: https://www.stelladot.com/stylist/IDS



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