Becoming a Stella & Dot Stylist

becoming a stylist

Stella and Dot is a multi level marketing company which sells jewelry. They are known for their trunk shows and stylists who help customers with creating overall looks to go with the jewelry.
You can find vague information about Stella and Dot’s compensation and initial costs on their website. You can sign up on their site to become a stylist and they will assign you a sponsor if you don’t already have one. Anyone can also buy jewelry from the site directly.

It’s a lot harder to find details about exactly how everyone makes money and gets promoted, details about training, and a good idea about the costs of being a Stella and Dot stylist. Most of this information is given to new stylists after they purchase their starter pack. [1] [2]

What does it cost to get started?

To begin selling Stella & Dot as a stylist you purchase a starter pack. Starter packs sell from between $199 and $699.

$199-$699 starter pack

Other expenses
Personal sales website is free for 60 but after that is $129 for a year or $39 per quarter.
Additional samples may be purchased at 50% off and are suggested to improve trunk shows
You can also purchase things like lookbooks and emarketing

Do you need inventory? Can you just sell online?

The Stella & Dot FAQ don’t really give a straight answer here, but in order to become a stylist you must at least purchase an initial starter pack with samples. Most of their training materials appear to encourage selling at trunk shows (with samples and ordering) and supplementing with online trunk shows and ordering.

Stella & Dot does offer an online affiliate program which is not available to stylists and does not require inventory.

Encourages personally purchasing to meet quotas and get bonuses

Because commission structure requires stylists sell a certain amount each month, stylists may be encouraged to purchase that amount for month regardless of whether customers want to buy jewelry. It seems like a good idea because otherwise the stylist is letting down their sponsor and missing out on the opportunity to get commissions or other incentives (free stuff, etc).

This cycle of personal purchases to meet quotas can lead to debt, stress, and problems. Personally purchasing to meet qualified volume requirements is never a solution, ask sponsors for other solutions — introduce you to new leads, co-host an online trunk show, etc.

Who is getting paid and how? Details!

Stella & Dot is pretty clear with their compensation, however detailed information is generally shared after stylists join the company and receive their training materials.

Digging into this a bit more, it gets pretty complicated there are levels based on the number of stylists you’ve recruited onto your team, and quotas for personal sales in order to continue receiving the bonuses from building a team.

commisions

Commissions
Stylists make commissions based on their personal qualified volumes (25-35% depending on how much they are selling. Once they’ve recruited leaders can make commissions on the sales of the stylists they’ve recruited.

4-9% on the first line’s or first level’s commissionable volume
   During a new stylist’s Jump Start period (first 60 days) you can get an additional 3%
0-5% on the “second line’s” or second level’s commissionable volume

Where you fall in these ranges depend on your rank (higher ranks get higher percentages)

Other requirements and bonuses
Group Qualifying Volumes – that is the first three levels must sell a certain amount of qualified volume in order for everyone to maintain their levels.
There are promotion bonuses for reaching new pay rank. These range from $100 to many thousands of dollars.
‘Generations’ also affect compensation by allowing you to extend commisions beyond the first two levels.
Discounts and product credit awards are also awarded at various ranks

Stella & Dot LevelsStylists
A qualified stylist is a stylist who has sold $500 PQV (PQV is personal qualified volume or personal retail sales). Weekly commissions of 25%-35% (higher amounts if more PQV during that month). A lead stylist has one qualified leg – a leg means that the stylist has started a tree of stylists or the stylist has sponsored one other stylist (who can then go on to sponsor sylists).

Team Leaders
At this rank, there is the introduction of the Group Qualified Volume required to be promoted and hit the monthly pay rank. This is the amount of qualified volume sold by the stylists in the first three levels. For associate stylists the GQV is $3,000 but this goes up to $12,500 for Star Stylists. Personal qualified volumes go up at this level as well. Associate stylists are required to have $1,000 in personal qualified volume sales. Team leaders have to have multiple qualified legs.

Team Directors
Directors are required to have Star stylists in their legs. The number of stars and star legs determine what level of director. The total qualifying volume (whole organization not just the first three levels) must be balanced across legs, so no one leg can account for 50% of the TQV. $12,500 of the group qualifying volume must come from your non-star group.

Executive Directors
Executive directors require everything that team directors do but they must have a newly promoted star stylist from their first level every rolling 12 month period.

compensation plan
It’s really really complicated

Return policy has important exceptions

Samples and display jewelry are treated differently when it comes to returns. Given that you must purchase starter packs to become a stylist, be careful with the amount and kind of jewelry purchased at these prices because it may not be possible to return them.

“Returns or exchanges are accepted on unworn items in resalable condition (excludes sale items, Display Items and Business Supplies, which are Final Sale).”

[1] [2]

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LuLaRoe: Cost to Get Started

Lularoe is a multi level marketing company which sells clothes. They are known for their leggings which come in limited edition patterns. Consultants sell clothing at parties.

What does it cost to get started?

By looking at training documents created by independent consultants it appears start up costs range between $4.5K – $7K for initial inventory alone. There are also other things to buy to be able to sell the initial inventory (hangers, storage, etc). Consultants are also encouraged to buy business cards, hangers, etc to support their business.

“The expenses a Consultant incurs in the operation of the Consultant’s LuLaRoe business can vary widely and can be several hundred dollars or thousands of dollars annually. Such operating expenses include the amount that you pay to become a LuLaRoe Consultant and inventory purchases, and could include advertising and promotional expenses, training, travel, telephone and internet costs, business equipment, and miscellaneous expenses. You should factor in estimated expenses when projecting potential profits.”  – lularoe.com 

 

Pressure to Buy Inventory

Consultants (bottom level) are required to purchase a substantial amount of inventory to get started. In order for trainers (higher levels) to earn bonuses on their downline — both trainers AND their downline must buy more wholesale inventory each period.

These incentives mean new consultants are encouraged to buy more wholesale inventory even when the inventory they have is not selling or is unlikely to sell.

The path to profit is unclear. Check out this breakdown of cost/revenue on initial inventory at BottleSoup.com: LuLaRoe or LuLaNoe: Will Your Investment Pay Off?

Be Careful With Debt

Many of the training documents mention calling ahead to your credit card company to get approval for the large charge. Encouraging to buy on credit coupled with encouraging to buy wholesale inventory even when there is no demand means borrowers may not be able to repay their debt. This can lead to a cycle of debt where one feels like they can’t afford not to continue with the company, leading to further purchases and more debt.  

Other Concerns

“The product sells itself”

It sounds too good to be true, because it is. The product does not sell itself, the consultants need to sell the product and when it doesn’t sell, the consultants lose money they risked buying the wholesale inventory.

Some trainings indicate you can return merchandise for a 15% restocking fee.

Check out some skeptics:
http://www.bbb.org/central-california-inland-empire/business-reviews/boutiques/lularoe-in-corona-ca-89069765
https://www.glassdoor.com/Reviews/Lularoe-Reviews-E865260.htm

 

Note:
Most of this following information is not on the corporate website and instead must be obtained through other consultants. Consultants are also not very transparent about this information and generally provide it only after new recruits express interest (through submitting email addresses, responding to posts, etc). The best information we’ve found is from training materials created by consultants building teams.[1][2] Comment or contact us with corrections or updated information.

[1] [2]

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MLMs Break the Internet

Multi level marketing breaks the internet

If you heard about something that seemed like it might be too good to be true, your first reaction would probably be to Google it. Maybe if you’re really suspicious, you might add “reviews” or “does it work?” to your search. We trust the internet to make available to us all of the best information–and most of the time, it does.

Unfortunately, with products distributed by multi-level-marketing companies, such as Plexus and Lularoe, your go-to Google search gives you bad information. That’s due to a clever trick that these companies use to exploit a common weakness of algorithms used by companies like Google, Facebook, and Twitter.

How MLMs Break Google

The internet is made up of millions of pages of content. In order to answer your every question, your favorite search engine has to know about all of that content.

There’s so much content out there that when you ask a question, your search engine can’t show you every possible answer. Instead, it has to examine all of that content to decide what it thinks are the best answers. “Good” content rises to the top of the search results, and “bad” content gets demoted to the end of the list, where you likely never see it (most people only look at the first few results). To decide what’s good and what isn’t, your search engine scans everything for clues, including how frequently different kinds of content appear. The internet relies on wisdom in numbers, just like we do.

This ranking system is how multi-level-marketing companies control their online presence. These companies encourage a lot of people to create a lot of positive content (videos, tweets, reviews, blogs, websites, and more) all over the internet to promote their products. The huge volume of unique results tricks website search engines, feeds, and trends into thinking that this positive content is the best content about these companies and products. Critical and unbiased stuff gets drowned out.

MLM companies know that If you search for a bad review of something online and you can’t find one, you will probably conclude that the product is great, not that you just can’t find the bad reviews. If you search for a product online and you can’t find it, you probably will conclude the product doesn’t exist at all.

Searching

The implications of this are a little bit mind-blowing. The algorithms behind Google’s search results, Facebook’s feed, Twitter’s trends, and are so powerful that they can change how we think about what’s important or even what exists.

But isn’t that spam?

Really, this is a system where companies blanket the internet with a huge amount of biased information about their products. If they were blanketing your inbox, your mailbox, or your windshield with that information, we would call it spam. Does that mean that all of these chirpy blog posts and motivational tweets are spam, too? And if so, why don’t search engines notice and banish it all to the “bad” category, never to be heard from again?

This is where the MCMs’ plan get even more sophisticated. Breaking the internet isn’t just a numbers game. It’s the kind of content that really counts. Search engines are diligently trying not to show you spam and other undesirables, like your classmate’s old Geocities site from 1999. On the other hand, sites are also sniffing out good content that’s important to you.

As far as Google, Facebook, Twitter, and their ilk are concerned, MCM content isn’t spam. Spam is generated by computers, sent out to huge lists of unsuspecting people, and is really obviously scammy to humans. Spam is not created by a bunch of individuals creating unique blog posts and videos talking about their experiences, and sharing with their personal friends and family. But since MCMs encourage individuals to do the company’s promotion for them, it’s individuals who are generating all of the blog posts, tweets, videos, testimonials, and motivational updates. Those are your friends or your family members posting, so all of that content must be “good” content. At least, that’s what the time-tested logic of the internet would say.

The problem is that the internet’s ideas about good and bad content haven’t caught up to the age of social media. These posts may seem important, but in reality, they are a brand-new kind of spam. Like the chain letters of your childhood, this spam is made by social networks, not computers. Multi-level-marketing leaders actually even train their teams to avoid detection (read: seem less like a computer, more like a human) by teaching things like “don’t copy and paste posts” and “get creative, be unique.” Part of the reason these companies have flourished is because their model is strongest where the internet is the weakest: algorithms are not as creative as people are. And unlike clicking “report spam” on an email, you’re not nearly as likely to block your friend or loved one.

So, posts by the people who are selling the products or recruiting for the company seem important because to the algorithms — they look important. This means these posts show up at the top whenever you search YouTube, Google, and Twitter. If you look for reviews–even if you search for bad reviews– all you’ll find is content that the company, or its representatives, has personally crafted. The company has total control over what shows up online.

The problem just gets worse

The people creating this content are good people, doing their best to sell products and recruit new team members, caught up in something larger. The problem snowballs out of control as new people rely on the flawed information online for protection, only to get entangled themselves.

research
Regular tools for researching MLM products and companies just don’t work.

Suppose Jamie is thinking about joining a team selling an MLM vitamin product. Even if she is smart, she knows how to research, and she cares about doing her due diligence, she can’t. The tool Jamie trusts to do that research–the Internet–is effectively presenting the company’s advertising materials as the factual truth. Extensive research leads Jamie to the very biased conclusions presented by the masses of people already involved with the company. So Jamie joins the company, and creates even more content. If Jamie joins a particularly bad MLM she might end up losing a lot of her money and time, and involving family and friends along the way.

Learn more

Check out these links to learn more and leave questions in the comments!

How does Google search work, more

No. 1 Position in Google Gets 33% of Search Traffic

Info about Facebook’s feed algorithm, F8: How News Feed Works

NYTimes: Facebook’s Bias Is Built-In

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LuLaRoe Leggings

Fun and Unique patterns

LuLaRoe leggings come in a variety of fabrics (manufactured abroad). Rarer patterns are dubbed “unicorns.” Consultants may not have more than one of a given pattern.

They are often described as comfortable, modest, and of good quality with a great fit.

“Like butter”
The leggings are often described has having a buttery texture that is super soft.

Common complaints

No returns and difficult exchanges
Most consultants appear to offer exchanges with the merchandise they have in stock, but they don’t allow returns.

Inconsistent quality and fit
Products are made of different fabrics, in different countries, and are of varying quality. Some of this appears to be part of the interest in LuLaRoe sales model (scarcity of certain types of fabric shiny vs tshirt etc), but it also manifests in many customers being unhappy with quality and hit or miss on particular fit.

Inconsistent pricing
Different leggings and different consultants will sell at different prices. Also, prices may be different in different social networks — if a lot of people are selling then prices will go down. Check out ebay for lower prices (here’s pricing for sold leggings on ebay to give you an idea).

ebay listing

Check out these other Leggings

American Apparel
These leggings have great patterns and feel good that American apparel is made in the USA (sweatshop free!). Prices are a bit higher than LuLaRoe but quality is consistent, and returns are easier. Free shipping for purchases over $50.

Zella Leggings from Nordstrom
When found on sale their price point is similar to LuLaRoe but their quality is outstanding. Consistent quality, fun patterns and colors, and larger sizes. Free shipping and free returns.Check out the reviews (good and bad), and the transparent pricing.

Society6 Leggings
Check out Society6 for the best patterns. Though prices are a bit higher each and every purchase goes to support the artist who created the design (learn more). Products are produced on-demand to avoid waste and keep the business sustainable. Support artists and wear awesome clothes!

ModCloth Leggings
Always cute and unique with great prices, ModCloth has tons of fun patterns and colors in sizes which range from XS-4X. Check out outfit photos to see the fit on real women in your size, and reviews which comment on fit and feel. Free exchanges, easy returns, and hundreds of reviews from women of all sizes.

Before purchasing, consider that your purchase supports the business practices described here. In addition to the information above, LuLaRoe has an incentive structure that leads us to recommend considering alternative products.

American Apparel Leggings are made in the USA
American Apparel Leggings are made in the USA
Awesome reviews, free shipping and returns
Awesome reviews, free shipping and returns
Society6 Leggings have awesome designs and each purchase pays an artist
Society6 Leggings have awesome designs and each purchase pays an artist
ModCloth Leggings have reviews and photos from women of all sizes.
ModCloth Leggings have reviews and photos from women of all sizes.
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