Pros and Cons of Five Popular Party/MLM Businesses

Since more and more moms are opting to stay at home these days (some say the number is up 15% in the last 10 years) sooner or later a mom is going to get asked to a “party.” What kind of party? One may ask. And the answer will go something like this “Oh we’ll just get together, have something to eat, a little (facial, lingerie show, book show, toy demonstration..insert word here), you get to hang out with some other women, it will be fun!”

I’m talking about all the “work out of your home, on your own time, run your own business” opportunities out there. Most of the moms that I know are suburban women with two kids, a minivan, a husband who travels for work, and a three-story house. Most of them also have a little business, one of the several party-based, MLM businesses that seem uniquely set up for women. Just so you will know what to expect the next time someone invites you to a party, and then asks if you’d like to make X amount of dollars in your spare time, here is the lowdown on five of the more popular, common party businesses.

Mary Kay This cosmetics and skin care company has been around since 1963 and has gone through several facelifts in the last 40 years. But the pink and white packaging and the pink company car are still familiar. The products are great. The investment is only $100 for a starter kit. You can earn a pink Grand Prix, Vibe or the famous Cadillac for a certain number of sales and recruits. However, a director will usually suggest making a big order in order to get the biggest discount and therefore the largest profit margin (40%). Mary Kay is one of those businesses where the basic set-up is inviting people to host a “party” for you at which you hope those guests purchase your product and then agree to host a party as ell. But sometimes it is hard to unload all the product. You don’t know what people will order and it will usually be something you don’t have. And like most of these other businesses, the biggest money comes in recruiting in a multi-level marketing format. So unless you know a lot of people who would just love to buy and then sell the Mary Kay line, it may just end up being an expensive way to buy your own cosmetic and skin care products.

Arbonne International is another cosmetics and skin care company with a twist. It is based in Canada and is eco-friendly for the new age. Founded in 1980, all of their products are herbal and botanical based, not tested on animals, and they put a big emphasis on health and wellness. Arbonne International’s salespeople are also independent consultants and the compensation range is 35-50% depending on what the consultant chooses to resell the products for. This cosmetics company’s incentive is a Mercedes-Benz for top salespeople with top recruits. The products are great, and the company is reputable, but unless you are willing to do lots of cold calling, stopping people in the grocery store to talk about skin care or business opportunities and work really hard, big money isn’t on the horizon. Arbonne International is also an MLM (multi-level marketing) company and the highest compensation comes from recruiting the most successful people to be under you (your down line, in MLM talk).

The Pampered Chef is another MLM-based company started 25 years ago that sells upscale cooking and kitchen ware, mostly proprietary to The Pampered Chef. The home parties for Pampered Chef usually include a meal prepared as part of the demonstration. Becoming a consultant for The Pampered Chef requires a minimum starter kit for $90. Becoming successful as an independent consultant for The Pampered Chef includes conducting those same demonstrations at other people’s houses where they have invited guests that you hope purchase product, agree to host a cooking party, and even become a consultant under you. One upside about this company is that you aren’t required to carry stock. All orders are shipped directly from Chicago to the party hosts.

Southern Living at HOME was created in 2001 in response to readers of the magazine Southern Living who were inquiring about where to buy some of the products in the magazine. Southern Living at HOME features one of a kind decorative and accent pieces for the home. Start up cost to be an independent consultant is $199 for samples and initial supplies. The profit margin for personal sales is 25% and incentives are added when you acquire recruits or a down line. Southern Living at HOME requires like most other MLM businesses a tireless energy and an endless supply of friends and acquaintances who want to buy your products, host your parties, and eventually sell for you.

Let’s end this discussion of five common party businesses with a hot note. Pampered Passions Fine Lingerie basically has independent consultants (called “hostesses”) to conduct lingerie parties. These parties can be for private friends, bachelorette parties, couples nights or one of many other themes. Pampered Passions has taken what has been viewed as “naught night out” for some other lingerie companies and made the home lingerie party a bit more upscale. Still, the premise is that the hostess invites a group of friends, shows them a bunch of lingerie, and hopes that they buy, and hopes that they invite their friends next time. Instead of a start up cost, each party can be purchased with a kit. The hostess or consultant gets a discount on this kit and then can sell the lingerie and other items for what she chooses to be her markup. There might be some ladies getting rich hostessing Pampered Passions lingerie parties, but a hostess is encouraged to recruit other hostesses to boost her earnings.

MLM is not for everyone. For the right person, it can be very profitable, but the real money is in recruiting. For most of us, it can be a cheaper way to indulge in a product we like and maybe make a few bucks on now and then. At the worst, all our friends and family will duck when they see us coming, or start screening their calls if they’ve heard the pitch once too often. Look at the opportunities very carefully and decide only after really watching a consultant for several months. Some consultants initially do well with the friends and family effect, but the momentum can be hard to sustain when you are accosting strangers or making cold calls.

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