What Everybody Ought to Know About Mary Kay Cosmetics

What Everybody Ought to Know About Mary Kay Cosmetics

Have you been considering a new business? Are you thinking about maybe Mary Kay cosmetics? Really some people do well with a Mary Kay business. Starting, you will become a Mary Kay consultant. All Mary Kay consultants’ are Independent Beauty Consultants (IBC). I have seen success with Mary Kay and heard some horror stories.

Let take a closer look. We always start with.

Mary KayMary Kay History

Mary Kay Inc., an American company, privately owned. The company sells cosmetics, using multi level marketing. Mary Kay was the sixth largest multi level marketing company in the world in 2015, having a wholesale volume of us$3.7 billion.

Mary Kay is based in Addison TX, outside of Dallas TX. The company was founded by Mary Kay Ash in 1963. Her son Richard Rogers is the chairman and David Holl is the president and in 2006, was named CEO.

Business Model

Of course, Mary Kay sells cosmetics through a multi level marketing model. Distributors (beauty consultants’) can make money by direct selling to the public, people in your community. Also make money by receiving a commission from wholesale purchases made by your down line, your recruits.

To qualify beauty consultants’ must purchase a starter kit $100.00. As a private company, Mary Kay releases very few details of money made by sellers. In 2005 Mary Kay reported wholesale worldwide sales exceeded us$2.2 billion.

Manufacturing Plants

The companies main manufacturing plant is in Dallas, Texas. A second plant was opened in Hangzhou, China to manufacture and package product for that market. Then in 1997, a third plant was opened in La Chaux-de-Fonds in Switzerland for the European market. The Swiss plant was closed in 2003.

Animal Testing

This is a big thing for cosmetic companies. After pressure from animal rights groups, the company announced a moratorium on animal testing in 2008. In 2012 Mary Kay expanded into China. The Chinese government requires animal testing of all health and beauty products. The Chinese government carries out these tests. PETA has removed Mary Kay from the “does not test” list.

Earnings for Consultants

Retail Sales Earnings

Mary Kay Beauty Consultants earn 50% gross profit on all product sold at full retail price. The quoted yearly earnings for an IBC of US$1,057.14 (2015) This figure was reached by dividing annual wholesale sales by number of IBC. This figure does not take into account: product returns, sales at discount, purchases for personal use, eBay or auction sales. These would of course lower that figure.

Flower mary kay logo

Mary Kay logo

Recruiting Commission Earnings

This includes the bonuses and commissions of 4,9 or 13% that one earns on wholesale purchases of their team or unit. These bonuses come directly from Mary Kay ans not the consultants or their units or team. In Feb 2010 Mary Kay (Canada) reported these figures.

  • 29,675 people were consultants’ for the year.
  • 1,878 consultants’ earned more than CAD 100 in commission.
  • 276 of the 553 sales directors earned more than CAD 17,471 in commission
  • 15 of the 23 national directors earned more than CAD 100,000 in commission.
    For Mary Kay (US) National Directors the median gross income in 2006, $175,443.00 this is before business expenses.

Consultant Turnover Rate

    With information Mary Kay (USA) supplied to the Federal Trade Commission (FTC) a 68.6% turnover rate per annum was calculated. An 85% per annum has been calculated with information from Mary Kay Canada.
    • These documents exclude individuals who earn a commission and are in the company for less than one year. Also excludes individuals that are with the company more than one year, but do not earn a commission check. Seems to made they are excluding a lot of possible quitters. I imagine the people there least and making the least are most likely to decide to move on.

Hidden Costs

    Mary Kay says that consultants’ make about 50% when products are sold at full retail price. But for every $1000. of product the consultant will get about $400. Consultants buy their product direct from Mary Kay, at their expense. Then resell at suggested retail price. It has been stated that the consultants’ agreement with Mary Kay has more than a little fine print. And this is adding extra costs to the process.

Refund Policy

    Mary Kay has what can be termed a liberal return policy. But (there is always one) this is not true for the consultants’. Consultants have a procedure to follow, likely resulting in less than a full refund. Lucky to get back 90% and are responsible for shipping and handling, possible commission charge backs could come into play. Obviously costing even more of your profit. I have to wonder why a billion dollar company cannot treat their very important front line consultants’ better. Any ideas here?

Mary Kay Products

 

 

    Mary Kay, Ladder of Success
    Success, meaning so many different things to us, We must all determine what success is for us. The Mary Kay starter kit/bag is $100.00 all consultants must purchase, this is the start of your very own Mary Kay business. The bag contains: Samples to share, Full-sized products for demonstration, Special offers for new consultants, brochures and DVD with easy to learn sales tips.
    A wealth of print and digital tools are available from Mary Kay to keep your business running. You will get access to your own Mary Kay personal website. I have not been able to get the charges for the website, but I have seen several and they appear to be identical. Thinking here that if this is a personal website I would want to put something of me on there. How about you, would you want to have a hand in design or content??
    myCustomers app will be your new personal assistant, an exclusive website created just for Independent Beauty Consultants, called the Mary Kay in-touch site. Don’t forget the Mary Kay virtual makeover app. And of course all the catalogs, fliers, hand outs, magazines.
    Certainly seems to be enough to help you along that road to success, you agree?

Common Complaints

People either love or hate Mary Kay. Guess that is true of a lot of people and companies. Some complaints from consultants:

Unfair ordering policies, Hidden costs, Unclear about the actual cost of becoming a Beauty Consultant, Pressure to buy more to stay in the company.

My opinion is that these complaints are not a large problem in of themselves. Rather, then indicate that there is a problem with communication particularly the lower levels, I believe.
Mary Kay Business Cards

Conclusion

Mary Kay is NOT a scam, it is a direct sales, MLM method company. Mary Kay has many fans and many detractors. From what I have seen there are lot of people working/attempting to work as a consultant. This is a business, there will be expenses, there will be a learning curve. If you have problems with anxiety, if you are easily intimidated, do not I repeat do not go into a job with direct sales.

I believe that Mary Kay has to work harder themselves to get people that are not doomed to fail right off the bat. What is happening here is something like what we used to say “the only qualification to get hired here, is a warm body” meaning of course they could be dumber that dirt. Hope that didn’t insult anyone, but if I did. Leave it in the comments.

Mary Kay gets 84 out of 100

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