This past weekend, I watched the LuLaRich docuseries on Amazon Prime video. What an interesting docuseries this was! The entire time that I was watching this docuseries, I couldn’t help but think about how much the world of MLM (multilevel marketing) parallels the world of resale. Let’s take a look into how these two worlds are similar and what lessons we can learn from them.
About LuLaRoe
The LuLaRich docuseries highlights the rise and fall of the brand, LuLaRoe, which I’m sure that many of you have heard of before. The docuseries features interviews from LuLaRoe’s founders, employers, and sellers. It showcases the history of the company and how it went from being a powerhouse to losing over half of its’ sellers in the matter of weeks. For those of you that are unfamiliar with LuLaRoe, LuLaRoe is a multilevel marketing company that sells whimsically printed dresses, skirts, tops, and other clothing goods. People are recruited into the company with the promise that they will make a ton of money working minimal hours. [For the top 1%, that may have been true, but for the majority, that just wasn’t the case.]
The company grew very quickly and became extremely popular among stay-at-home moms, specifically targeting caucasian women. As a result of such rapid grow, the company just couldn’t keep up with their demand and made many questionable decisions that negatively impacted so many people who worked under this company. People began question the integrity of the company and left in large numbers. Multiple lawsuits were filed and many of their sellers went into extreme amounts of debt as a result.
Back in 2016, when LuLaRoe was thriving, I remember what a big deal it was to source and sell LuLaRoe as a reseller. People would pay so much money to get their hands on a LuLaRoe piece. Nowadays, most reseller loathe finding LuLaRoe pieces at thrift stores. To many, it serves as a painful reminder of how LuLaRoe negatively impacted so many people’s lives.
Although reselling is not a MLM or pyramid scheme, per se, there are many aspects of it that are very similar to what was covered in this docuseries. Let’s get into it:
Lesson #1: Don’t Buy Into False Promises
In the docuseries, they discussed how LuLaRoe sold women a false promise. This false promise was that they would be able to make a full-time income while only working part-time hours. They would be making so much money that their husbands would be able to retire and work alongside them in their businesses’. Does this sound kinda sorta familiar to you?
When I first heard this on the docuseries, I immediately thought to myself, “This sounds like a message that I hear from just about every single reselling-related platform or service that I have ever stumbled upon.” Many of these platforms and services cater to the same demographics- low income, minorities, single and/or stay-at-home moms, and those who wish to be entrepreneurs. They are trying to sell people on the idea that you can make a ton of money while also having workplace freedoms if you use their platform or buy their service. However, most of these platforms and services fail to provide their users with any helpful tools or data. Additionally, they don’t prepare users for the reality of how much work is actually required to make sales on these apps.
Before signing up for any platforms or services, take a minute and really think about what your motivations and expectations are going into it. Reselling is very challenging and requires a lot of work, especially in the beginning. You probably are not going to make a lot of money in your first year if I am being completely honest with you and that is fine. It is something that you are going to have to work at consistently to grow.
Lesson #2: Do What is Best for You & Cut Out the Noise
One topic that was discussed in great lengths in LuLaRich is how the company put a lot of pressure on people to perform. LuLaRoe pushed people to BUY, BUY, BUY and Poshmark pushes people to LIST, LIST, LIST. Weird coincidence? I think not. These company’s create a false sense of community in order for you to feel safe and confident in your abilities to perform. In reality, they don’t care about you at all. All they care about is getting you to perform, so that they can in turn, make money. Many people don’t realize this and fall victim to these company’s sneaky ways.
[FYI: Do you know how Poshmark encourages you to recruit new users with your $5 off code? Promoting that message isn’t helping you at all. Instead, it is helping Poshmark to gain another user so that they can make more money off of their sales.]
Don’t get me wrong, I love reselling on Poshmark and other reselling platforms but I am also very aware that I am just a pawn to them. They genuinely do not care about me, which is fine. I will always do what is best for me and my business, just as they are doing what is best for them. Remember: Do what is best for you and your business and don’t be afraid to cut out any unnecessary noise from your reselling platforms if you need to.
Lesson #3: Don’t Put Yourself In Debt to Start a (Reselling) Business
This was the absolute hardest thing for me to watch in this docuseries. So many shared their stories and explained how they went into extreme debt over starting their LuLaRoe businesses. I didn’t know this but in order to enter into the LuLaRoe company, sellers had to buy introductory packages that cost them between $5000-$9000. That’s insane! Most of these sellers didn’t even earn their money from sales. Instead, they earned their money from bonuses’ based on how the people below them performed.
Reselling is not an MLM so the way that we make money is obviously different but I know that there are so many resellers who get themselves into debt over reselling. As a reseller, you want to be profitable and have money to take away at the end of the day. If you are buying as much as your are selling, are you really making a profit??! And social media doesn’t help this at all. Please don’t believe everything that you see on there; There are many people on social media selling you a false narrative. Being a reseller has many hidden costs that people don’t share with you. Just because someone made $5000 in sales, doesn’t mean that they are profiting anywhere near that number. Be smart with your spending and if you need help, reach out to other reputable resellers for assistance.
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