Facts, opinions, and the real story behind Mary Kay Cosmetics.
 

Top Director Income

Many recruits are snared into Mary Kay Cosmetics with the lure of executive earnings. They are told that the sky’s the limit, and the earnings are unlimited, if only you are willing to work hard enough. Sales directors tout their “highest checks” without ever mentioning all the business expenses that must be paid out of those checks, or that those are a one-time deal and don’t represent their normal commission checks.

The hard workers are the ones who make it big in Mary Kay, right? Wrong. One has to look no further than superstar Allison LaMarr, who was the fastest woman ever to make it to Mary Kay National Sales Director. Yet all of that hard work resulted in a downward spiral that culminated in Allison becoming the fastest quitter in Mary Kay history. She flailed for a few years, attempting to be a personal coach, a failed participant in multi-level marketing company MLM Bellamora, a former “executive” for multi-level marketer Seacret Direct, and then spent time spinning her wheels trying to build a downline as a distributor for Seacret. All that came to an end when she married the owner of Seacret and disappeared Allison in favor of her new persona, Chaya Mushka Ben-Shabat. No need to shill for an MLM when you ARE the MLM.

Time and again, a critical analysis of the numbers shows that almost everyone who participates in MLM will lose money, regardless of their effort. Even those who reach the top 2% of Mary Kay – – the sales directors – – aren’t making a whole lot of money. Even the most successful directors – – those in the pink Cadillac – – are making around $40,000 per year, if they’re lucky (and that’s only with 40 to 60 hour work weeks). Even with repeated hard work, sales directors are regularly failing to move up – – and are very often moving down – – while telling recruits that they can make as much money as they want and promote themselves whenever they feel like it.

But if you work hard enough and get lucky enough and make it to “top director,” you’re set with that executive income, right? Wrong again.

I was provided with the Income Advisory Statement for a top director in Mary Kay. This woman is in the top 25 directors in Mary Kay in the United States. She is in the Circle of Excellence, and goes on the Mary Kay Top Director Trip. She has a number of rings and prizes that she has won. While the number for total income, including commissions and prizes of $150,000 looks impressive, a closer look reveals a different truth:

  • Prizes totaled $50,000. While this sounds wonderful, the truth is that the value of many of the items appears inflated. And taxes must be paid on all of these prizes, at the inflated value.
  • The commissions totaled $100,000. This is the actual cash in hand for the director, out of which all business expenses and income taxes must be paid. Remember that the taxes are at higher rate than if she had a real job, since self-employment taxes must be paid in addition to regular income taxes.
  • The monthly commissions ranged from $4,000 to $12,000. Seven months showed commissions under $10,000. Three months showed commissions under $5,000. Even as a top director, there is no stability in earnings.
  • Some months were so bad that this director owed a copay on her pink Cadillac. So much for the free car!
  • After factoring in business expenses (including the office staff!) and taxes due on the net income (including prizes), this director had about $34,000 cash left over from commissions to support her family.

Let me repeat that: A top director in Mary Kay – – in the top 25 nationwide – – has about $34,000 left over from that big income advisory statement figure of $150,000.

This director ordered about $35,000 wholesale value of products from Mary Kay last year. Being generous, she may have profited $28,000 if she sold all of those products and sold most of them at full retail value. Taxes on the profit from product sales will eat up $8,000, leaving $20,000 cash from product sales to support her family.

So the big “executive” income for a director at the very top of the company leaves her with $54,000 cash to support her family, but only if she sold all those products and sold them at full retail prices.

Women will read this, and will say that they would be thrilled to earn $54,000. And while that may be a fine income for many people, the point is that this is the money in hand for a woman at the top of Mary Kay directorship. The top! And almost no one will reach this top 25 status. Sadly, in multi-level marketing, your success is not determined by how hard you work. There are 14,000 directors in the United States, and I’ve just shown you what one of the top 25 is making.

And make no mistake that this woman is working 60 hours per week or more. Mary Kay is not the “work from home” opportunity it’s pitched as. It’s a ton of hours, most of them outside your home and away from your family. To work this hard and get this high in the company, only to make middle management wages, is nothing short of disappointing. It’s the hard reality of Mary Kay.

14 Comments

        1. Mountaineer95

          Brittani about her recruit returning the product for the 90% payback:

          “I felt betrayed because she was a friend”

          If that doesn’t sum up much of the problem with MK, I don’t know what does.

          The recruit was likely lauded for “starting her own business”, and yet when the recruit made a sound and proper business decision to return her product and use that buyback promise that EVERY director stresses as a reason to go ahead and start MK, Brittani is “hurt”? Lol. Brittani didn’t loan this recruit any of her personal money (because she didn’t have any what with these bad months and all). She has NO RIGHT to be “hurt” by the action of a woman who “started a business” and realized the venture was not going to be profitable and thus used what was available to her to recoup some of her losses.

          1. Lazy Gardens

            Yes, the recruiting friends and family is a deliberate tactic to minimize returns because of “friendship”. So when a return happens, the recruiter gets butt-hurt. If it doesn’t happen, the friendship crumbles because the recruit starts to realize they “friend” exploited the friendship to make money.

  1. NayMKWay

    “No need to shill for an MLM when you ARE the MLM.”

    Truer words were never spoken. People who (wisely) drop out of the MLM rat race are often ridiculed for being unwilling to do the work. “You just thought it was a get-rich-quick scheme,” they’ll taunt.

    Well, MLM is a get-rich-quick scheme—for the company founders. Mary Kay Ash certainly thought so.

    How better to finance an operation than to charge people to join, and to make them continue to pay to stay in? And how better to entice them to join than by making it sound like a pot of gold? Flash those big commission checks, parade “free” pink Cadillacs and trips in front of people…what are they supposed to think?

    Here’s a 12-year-old self-published piece from Bellamora:

    http://EzineArticles.com/5449440

    While some of it is about their “amazing” skin-care peoduct line, it mostly raves that everyone who gets in on the pre-launch will soon be rolling in it. “Ten ways to get paid” and “a billion dollars in commissions” are a couple of the choice phrases.

    MLMs recruit on false pretenses of easy income, then blame the drop-outs for believing the promises. MLMs are just vile.

    10
  2. Char

    I sure hope this article reaches the participants. IF you make it to the “top 2%”, you will make roughly $17/hr working 60 hours a week hustling people into a pyramid scheme. That’s $17/hr with no benefits!

    Why did I wrap quotes around “top 2%”? Because they’re not actually the top 2% in the company, the CEO, COO, CFO, and all upper management are. I seriously doubt the people on the page “MaryKay..com executive bios” know the names of any of the “Directors”.

    “No need to shill for an MLM when you ARE the MLM.”—

    That’s exactly what I’m trying to convey. Allison LaMarr actually does have bragging rights now, albeit for another MLM scam. You know what they say, “If you want to make serious money in MLM, start one.” (Or marry a founder)

    The people who work for the company at Corporate can reach top level executive status – not the MLMer minions. And, it doesn’t matter what silly, fake title the minion is given; it’s a title that means nothing in the real corporate world. People advise MLMers not to put their MLM scam experience on their resume. Think about that, and duh.

    For context, the consultants are the equivalent to a sub-contracted janitorial “cleaning force” that buys tons of makeup from the company they clean for. Imagine the biggest orderer prancing around claiming to be in the top 2% of the company; it’s laughable.

    The MLMer pyramid section of the company is actually the company’s sales and marketing strategy to collect direct buying customers. It’s working too, even with the small kickbacks given to the “cleaning force”. It’s no secret that Mary Kay is worth billions and debt free. Mary Kay’s top executives make hundreds of thousands per year, guaranteed under contract, and with benefits.

    My comment today is also for all the upline in their stinky, ugly suits who think others should be kissing their feet; for the ones who snub other consultants because they think they’re so important. How about they convey their importance to the Board of Directors? They’d be laughed out of the room. Btw, this isn’t about demeaning good workers; it’s about calling out pyramid schemers who think they’re more important than they are.

    Adding to Tracy’s point that being “the top 2% of Mary Kay MLM pyramid scam orderers” is only worth 54k and hardly impressive, neither is being an MLMer at any level…..or amount of money.

    1. Data Junkie

      Great metaphor Char. I will suggest another metaphor can also drive this point home.

      Mary Kay functions like a buying club, where you get cash back on your purchases. And if you can refer people to join under you to do the same, you get a portion of their cash back as well. Because the “cash back” incentive drives participation more so than the product itself, only a tiny fraction of the product is ever retailed or consumed.

      The product in a Mary Kay purchase is just a “token” that empowers the “cash back” engine. No outside sales are necessary for this entire system to work. MKC proves this on a daily basis.

    2. Mountaineer95

      For anyone who is is Allison Lamar’s current focus:

      https://menachemmendelacademy.com/our-founders/

      Chaya Mushka’s story (sorry this is so long but it’s her “story”):

      “The co-founder and CEO of Menachem Mendel Academy, Chaya Mushka Ben-Shabat is also a seasoned entrepreneur, professional development coach, and public speaker. The Texas born daughter of a Baptist preacher and a music teacher feels a deep personal connection to the Lubavitcher Rebbe and to his universal messages of moral education and caring for people.

      After earning a degree in marketing from Texas A&M University, Chaya (then known by her English name, Allison) took a job in corporate banking and started work on her MBA at Southern Methodist University. Introduced to direct sales by a friend, she dropped out of graduate school to build a highly successful sales business and set multiple records in that company, including the fastest person ever to reach the highest position in the company. Her leadership and team-building skills led to greater opportunities for mentoring women entrepreneurs and to starting her own business coaching women in both personal and professional development. She led seminars throughout North America, was a sought-after guest speaker, and wrote a widely distributed weekly blog.

      When Seacret, an international skincare company based in Phoenix, convinced her to launch their direct sales line, Chaya’s life took an unexpected turn. All employees were required to attend an informal, weekly Shabbat dinner at the home of the owners’ Moroccan Israeli parents. At one such meal Chaya found herself sitting across from their youngest son, a yeshiva student visiting from New York. That intriguing conversation sparked a reexamination of her own faith and a fervent prayer to understand the truth of life. While in New York on a business trip, Chaya attended Shabbat services at Chabad headquarters. It was her first visit to a synagogue. The inexplicable attraction and subsequent events prompted an amazing genealogical search that led Chaya to find she has Jewish roots and discover distant Sephardic relatives living in France.

      Amidst this roller coaster journey of discovery, her first marriage ended, and she was learning to navigate life as a single mom. With her three-year-old son, she turned her life completely around to become a Torah-observant Jew, honing the skills of positive thinking, creative problem-solving, and resilience, accepting that everything is part of God’s plan. Later remarried to Seacret co-founder Mordechai Ben-Shabat, Chaya spent several years traveling the world to help expand the family’s global business using her experience in marketing, sales training, communications, leadership, and strategic planning.

      Chaya’s commitment to education grew from her six-year exploration of options for her own son, and her awareness that in order to transform the world, we must first start at home with our own children. Her vision for MMA is to bring together a global tribe of like-minded people who insist on excellence for the next generation. Chaya says that the inner dimensions of Torah continue to change her life daily, and she is passionate about empowering others to discover, harness, and shine their own special light.”

      Whatever, Allison.

      Note…if you explore the link above (for the school), you get an idea of how…unusual…their goals and methods are. At least is was the last time I read it.

  3. Wild Collards

    The Allison LaMarr story was great in real time, I remember it going down and down and down…the she resigned, MK Corp sued her…she was the FACE of falling from the top to the bottom of MK.

  4. Mountaineer95

    I feel like every PT critic who comes here and declares how she knows “so many women who are making lots of money and taking care of their families” financially should have to read this post.

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