Multi-Level Marketing - Is it worth it?

I am not a fan of large multi-level marketing companies… I am definitely not against people making money or people starting businesses, but these companies are sort of out of control. Not long ago my friend Monica and I were out enjoying happy hour on a Friday night when the lady sitting at the table close by interrupted us. She just had to tell us how fun we looked. (We are fun!) But then she proceeded to tell us she really wanted us to come to her Mary Kay event, that we definitely didn’t have to buy anything just show up. Ok, lets be real… Don’t lie… You don’t want me to just come hang out, you want me to hang out and then realize how great Mary Kay is and buy a ton of stuff. For me I just don’t spend money on that type of stuff… Walmart or Target makeup for this girl works just great.

I get invited to parties of all types – health products, makeup, bags, kitchen supplies, jewelry…. I have been invited to 3 parties this week alone. How do I say yes to one friend and no to another?  I am an equal opportunity friend but I live on a budget as many of my friends do.

To me it just doesn’t seem worth it to both the consultant and the host.  To be a consultant you have to buy all the product to showcase, it doesn’t really seem that profitable to me when this is considered. It would be like if I worked at a sporting goods store, I would spend my entire check on Under Armour gear and Asic running shoes rather than pay my bills. But at the same time I wouldn’t need my friends to buy Asics and Under Armour to help support my habit so it would actually be better than being a consultant for a multi-level marketing company.

To host a party you have to clean your house, beg/invite all your friends to come, purchase food and drinks… All for a discount on a couple of products, maybe get a couple of products free. After factoring food and drink costs it is usually cheaper to just buy the products at full price than invite your friends into your house.

Most of the items you can buy at these parties are available at Target (or some sort of similar product) for much cheaper, or you can get on Etsy and find something original and handmade for less.  (Target doesn’t charge the $5-$15 shipping these parties do).

Seriously check out Etsy – The jewelry on this site is fantastic and is handmade all across the United States. This stuff is fun and you will most likely be the only one that has it out of any group of friends you go out with! And you are supporting a small business. Or…. Maybe you could sell Etsy stuff… (see below)

With large companies everyone gets a cut, making the product completely overpriced. The seller gets a cut, the person who recruited the seller, the recruiter who recruited the recruiter…. The company itself also needs to make a profit. When something is sold at retail the wholesaler and the retailer make a profit. So… its much easier to make more money and at the same time  maybe offer a product for cheaper.

If you still want to have home parties or sell a product BE ORIGINAL– There are plenty of small companies that would love to work with you. It might take more research but definitely worth it. A) Your friends will be so much more excited to see new stuff and B) You will probably make more money.  Average commissions from a large MLM company are generally 20-30% max. If you work directly with a wholesaler you can profit 50% and sometimes more.

You can also start websites with your favorite products, I hate technology and could even figure it out. Many companies will work to drop ship items you want to showcase. Check out thepinkstore.com.  This store is an ecommerce website that sells products for other companies. This could be done for virtually anything. My sister sells our headbands on various websites such as eBay and my mom does all the shipping. My sister never physically sees our headbands in Phoenix and they are shipped from Nebraska. While this is a family arrangement, it could easily be worked out with any business such as what thepinkstore.com does. Pixi Chix out of Lincoln is always looking for people to host parties/be reps for their products. They would work with virtually anyone that would be excited to sell their unique and cute clothing. It is completely different from any home parties I have been invited to. Again, there are several sellers on Etsy that would probably sell products to you. 

So…. Although I love getting together with groups of girls for a night of fun, I would rather just buy the bottles of wine and have everyone leave their money at home. And, I think if you are considering selling for someone, take the time and find an original product. It might be more work upfront but you will make more money and your friends will be much more excited to see what you are selling than being invited to the same jewelry, bag, kitchen party... :)