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Beauty Counter is a multi-level marketing company which sells makeup and skin care. Consultants can sell via parties, one-on-one sales, or online. Beauty Counter also has retail stores in three cities which compete with Beauty Counter consultants. Below, we analyze the income disclosure statement from […]
The most recent income disclosure we could find on the Thirty-One Gifts website was from 2015. However, an internet search leads various copies of a 2017 disclosure. It is difficult to find or cannot be found on the Thirty One Gifts official website. Below is what we found.
This disclosure can be a bit complicated to understand because of the fine print. The fine print lets us know that the table only includes consultants that were active in 2017. Thirty-one defines an active consultant as someone who submits $200 in personal sales volume in a rolling three-month period.
This fine print is pretty misleading because the table is labeled all consultants. The consultants in this table are actually more than active – they are pretty successful, all of them have $200 in personal volume sales in just a 3 month span (this can correspond to more than $200 in retail sales depending on the products sold).
Thirty-one did not report the percentage of total consultants are active. This makes it impossible to get a good idea of how many participants get paid. However, even the successful participants – 18% of those got paid less than $1 over an entire year.
An important thing to note is that none of the data takes into account expenses. When evaluating business opportunities, most people are interested in profit. Profit is the amount of money brought in (revenue) minus any costs and expenses. A ThirtyOne participant would need to earn more money than these expenses in order to have a profit.
Expenses for Consultants can be several thousand dollars annually. You should factor in estimated expenses when projecting potential profits. Such operating expenses could include advertising and promotional expenses, product samples, training, travel, telephone and internet costs, and miscellaneous expenses.
Thirty-One Gifts 2015 disclosure
A recent survey found that most multi-level marketing participants earned less than 70 cents per hour. The 2015 Thirty-One Gifts income disclosure statement disclosed the average hours worked and average annual income by consultants at different ranks.
Right around 80% of consultants in 2015 made on average $548 and worked an average of 7 hours per week. This amounts to about $1.50 per hour before considering expenses. If the expenses do reach even one thousand dollars as the disclosure indicated (“several thousand dollars annually”), consultants at this rank are losing quite a bit.
At the director level average income divided by average hours reached $10. Only 2% of participants are at director or higher levels. And again, that’s before expenses. It’s likely the case that minimum wage jobs, temporary work, or gigs are more lucrative.
Turning to the 2017 disclosure. We see that the top 1% of earners made more than $10,000. The disclosure lets us know that these consultants had an average tenure with Thirty-One Gifts of over six years. That’s a very long time. Looking only at these participant’s earnings in their most successful years is a form of survivorship bias.
The 2017 income disclosure statement does not break income down by rank, does not include information about average hours per week worked, or time to reach that rank. It’s likely that the difference in presentation accounts for the differences in the data rather than a significant change in the income for distributors. The numbers still stay in the same ballpark.
Most consultants are not earning much money from Thirty-One gifts. After considering expenses that most consultants are spending more than they are earning. The average earnings and corresponding average hours mean that consultants work very hard for the income. We recommend exploring other business opportunities and looking for profits per hour that exceed the minimum wage in your area.
Income disclosure statements also known as earnings disclosure statements help to understand the business opportunity selling Young Living. In 2017 Young Living released an income disclosure statement about the commissions and bonuses earned by Young Living members.
Usually, when people think about a good business opportunity, they are thinking about profit. Profit is money earned minus the expenses. The numbers throughout this disclosure don’t take into account any of the costs associated with selling Young Living. To get a better idea of profit we have to subtract any expenses for the year.
Note that the compensation paid to members summarized in this disclosure does not include expenses incurred by members in the operation or promotion of their business, which can vary widely and might include advertising or promotional expenses, product samples, training, rent, travel, telephone and internet costs, and miscellaneous expenses.
2017 Young Living Income Disclosure Statement
This means that if a member is making $0, or a very small amount of money it’s reasonable to assume that they are losing money selling Young Living. This is because their expenses for the above list would exceed their earnings.
The disclosure statement makes reference to the vast majority (89.5%) of members who are “preferred customers.” These members have not sponsored anyone. It implies these members are just buying oils, but that isn’t the whole story.
The best news for enrolling members is that choosing between becoming a Preferred Customer or a Business Builder doesn’t have to happen at enrollment! By purchasing a Premium Starter Kit (PSK) and enrolling as a wholesale member, you have 11 of our most popular essential oils to help you get started; your personal journey with Young Living will help you organically find your path as a Preferred Customer or a Business Builder.
https://www.youngliving.com/en_US/opportunity
This really hides the number of people who are working to build a business (selling and recruiting), but didn’t make money in 2017. Instead, it characterizes them as customers. Anyone who has not sponsored someone falls into this group.
We should not assume that most are customers. In 2016, Young Living did not have this “preferred customer” category and their disclosure looked much different. In the 2016 disclosure, 94% of members made a median of $0, with an average income of $1 (not including expenses). This $0 average included distributors focused on selling products instead of recruiting. This change in categorization aligns with the difference in average earnings.
The 2017 disclosure statement really only describes those who have successfully enrolled another individual. This accounts for 10.5% of Young Living members. One third of those or 3.5% of all members, get paid a median of $15 per month. The next rank, “star,” or 4.7% of all members and they make a median of $58 per month. Finally, the “senior star” rank has a median monthly income of $198 and makes up a little over 1% of all members.
We looked at medians because the averages indicate that a smaller number of high-commissions are driving the averages up. Medians are a better indicator of what more people are earning for this rank.
Business building ranks also have requirements though including a 50-100 personal volume requirement. This corresponds to $50-$100 or more in purchase requirements. Some of the “income” in this report really is earnings on these purchases (not sales). Check out the Young Living compensation plan for more information on the rankings.
The annualized average income is misleading because a distributor’s rank can change over the year, a distributor can join or become inactive during the year. In all of those cases the annual earnings are lower.
Young Living’s characterization of some business builders as “preferred customers” and excluding them from disclosures is misleading and hide the whole story. This income disclosure statement only gives an idea of income for those distributors who have already enrolled someone and does not include costs and expenses. Young Living gives a list of expenses that are important to consider.
Looking at the 2017 and 2016 disclosures it’s clear most Young Living distributors do not receive income. This is true even without considering the numerous expenses Young Living describes. By and large, distributors and those working hard to sell Young Living are not profitable.
No affiliation with YoungLiving. Please contact us with corrections or questions.
Source: https://static.youngliving.com/en-US/PDFS/IDSOnlineVersion_PDF_US.pdf
No affiliation with dōTERRA. Please contact us with corrections or questions. Source: https://media.doterra.com/us/en/flyers/opportunity-and-earning-disclosure-summary.pdf Income disclosure statements also known as earnings disclosure statements help explain how much money people make selling DoTerra. They also explain which levels make money. The statement doesn’t reference any of the […]
According to the official dōTERRA compensation plan, advocates make profits on the dōTERRA items sold to retail customers or preferred members. Profits are the amount sold over wholesale costs. Additionally, advocates can make money on bonuses paid based on the wholesale purchase volume of the advocates and teams they sponsor.
To participate in the bonus program an advocate must at least:
At higher bonus levels, there are bigger and bigger requirements to get the bonuses. It becomes harder to continue getting the bonuses each month, and most of the bonuses are based on sponsorship and team building.
An extremely small number of people (almost no one) will get to the highest bonus levels (leadership). People at the highest bones levels make a lot of money. dōTERRA’s own disclosures show that these top earners make up less than 0.5% of the members.
As a matter of fact, dōTERRA only paid bonuses to 25% of members. Most advocates didn’t make any commissions at all.
https://www.doterra.com/US/en/policy-manual-compensation-plan
http://media.doterra.com/us/en/flyers/opportunity-and-earning-disclosure-summary.pdf
Consider the following questions:
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