Scentsy is a popular home fragrance company that offers many different products people can use to create personalized home smells. The company was founded in 2003 and has since expanded into several different product lines. But just what is Scentsy? How does it work? And why is it so popular?
We spend more and more time in our homes, and we spend more and more money on home products. Many of these products are scented. Scentsy is one of those products that allows you to use the products you love, and have them smell wonderful. However, you should keep in mind that Scentsy is not a good opportunity.
Scentsy is a company that offers a wide variety of home fragrance products through a network of independent consultants. It is a way for the company to expand its reach to the millions of women and men who are interested in making their homes more inviting. In return, consultants earn a commission when they sell scentsy products to their friends and family, and the company gives them free products for their efforts.
Scentsy claims on its website that you may “make some extra dough” with its offer, but is Scentsy a good opportunity or just another multi-level marketing business that promises the world but delivers heartache?
Is Scentsy a Lucrative Business Opportunity? According to the Scentsy Income Disclosure Statement, only a small percentage of Consultants profit, while the majority lose money. Scentsy is not a business opportunity, according to Scentsy, Inc. Policy and Procedures.
Is Scentsy a Lucrative Business Opportunity?
Scentsy is referred to as a multi-level business or MLM in this article because it utilizes a multi-level compensation structure.
Apparently, whatever Scentsy has to offer isn’t a chance.
You are an independent contractor and did not buy a business opportunity when you became a Scentsy Consultant, according to Scentsy Inc. Policy and Procedures, Section 4.1.
Edith Ramirez, then-Chairwoman of the Federal Trade Commission, reminded Direct Selling Companies in October 2016 that a reputable multilevel marketing company must properly describe its business opportunity and what a member is expected to earn.
Scentsy seems to have chosen to claim that it is not providing a business opportunity at all, rather than properly portraying its business potential.
The statistics back this up. Most Scentsy Consultants lose money and leave, according to industry statistics and Scentsy, Inc. papers.
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3 Scentsy Secrets You Should Know
- 1Scentsy is a cosmetics company, not a business opportunity.
- 2The majority of Scentsy Consultants make under $140 per year!
- 3Only around 1% of consultants make a full-time living.
You are the client.
Scentsy may avoid the problem of opportunity, but the ramifications are obvious. When people join Scentsy, they expect to earn money.
Scentsy does not explicitly guarantee a job. The promise of “additional cash,” as mentioned on the Scentsy website, is not a guarantee of financial gain.
People, on the other hand, join for a purpose, and that motive is most likely to earn money. Why would individuals join Scentsy if they knew it didn’t provide an opportunity?
Are they just enrolling to squander money on Scentsy’s overpriced products? That is incomprehensible.
Perhaps it is the expectation of opportunity that drives individuals to become Scentsy Consultants.
The covert denial of “opportunity” by Scentsy is just half the tale and deceit.
Not only is there no opportunity, but the erroneous perception of opportunity converts the vast majority of Consultants into consumers.
Every transaction between Scentsy and the Consultant generates revenue for the business.
Do you want to buy a starting kit? Scentsy is a profitable company. The Consultant makes a financial investment.
Do you have to buy goods every month in order to qualify? Scentsy is a profitable company. The Consultant makes a financial investment.
Anyone who keeps track of how much money goes to Scentsy, Inc. will soon discover the reality.
They are the client.
When the emotional appeal of earning money is removed, all Scentsy goods become expensive.
That is MLM’s dirty little secret. Customers are first and foremost consultants.
It is from here that the majority of the company’s revenue is generated.
Warning from the Federal Trade Commission.
The Federal Trade Commission’s website provides a lot of information regarding MLMs and how some of them aren’t genuine.
Before joining Scentsy, we should be aware of two things, according to the FTC.
- 1How much money do Scentsy Consultants make?
- 2Does Scentsy encourage recruitment as a means of earning money?
What Do Scentsy Consultants Get Paid?
According to the 2018 Scentsy Income Disclosure Statement, Scentsy split their Consultants into two categories.
The first group consisted of all Consultants who had worked for the full year. This group accounted for about 31% of all Consultants.
This group’s average annual income was $1,989, and that was before expenditures were subtracted!
Consultants who were not active for the whole year made up the second group. They either resigned or were fired. This group accounted for 69% of all Consultants.
Allow that to sink in: about 70% of all Scentsy Consultants depart within a year.
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The average annual income for the second group was $239, and that was before expenditures!
It’s worth noting that the annual revenue numbers were calculated before any company costs were subtracted.
We know that each Consultant paid $99.00 for a Starter Kit. That implies the second group didn’t make more than $140.
They most likely made a lot less.
Dr. Jon Taylor believes that the typical annual business costs for an MLM company are about $2,500, according to his study published on the FTC’s website.
If we subtract $2,500 from each group’s average income, it seems that no one earned a profit.
The Scentsy Income Disclosure, on the other hand, shows that someone made almost a million dollars. The issue is that there were so few people who earned money that it is statistically inconsequential.
To put it another way, just a small percentage of all Scentsy Consultants made a profit.
Everyone else was out of pocket.
Is it true that Scentsy promotes recruitment as a means of making money?
There are eight tiers to the Scentsy Compensation Plan. Every level, save the first two, Escential Consultant and Certified Consultant, needs recruiting.
The FTC’s Warning Has Been Revisited.
When considering joining an MLM like Scentsy, the Federal Trade Commission advises that we look into how much most Consultants make.
In the case of Scentsy, the majority of Consultants lose money.
The FTC also cautioned that if an MLM advertises recruitment as a means to earn money, it may not be a genuine business opportunity.
Recruiting is required at every level above the first two, according to the Scentsy Compensation Plan.
The Unstated Goal of Scentsy
Understand that Scentsy was not designed to help you earn money before you join as a Consultant. Orville and Heidi Thompson founded Scentsy in 2004 as a multilevel marketing company (MLM) to supplement their income.
Before establishing Scentsy, Mr. Thompson had a lengthy career as an entrepreneur. By every measure, the Thompsons have been phenomenally successful.
Mr. Thompson built his company to over half a billion dollars in yearly sales in less than seven years, an achievement that any businessman would be proud of.
While I appreciate Thompson’s accomplishments, the fact remains that Scentsy is not a charitable organization. It’s a business, after all.
Scentsy’s main goal, like any other company, is to maximize profits. While this is a valid goal, it is accomplished by abusing its sales staff.
And therein is the problem.
One of MLM’s distinguishing features is that its salesforce is self-funding. In other words, rather of the business footing the bill for a sales force, the Consultants foot the bill.
The business spends little or no money on the Scentsy salesforce. Not only does the sales force cover the company’s costs, but the Consultants are also likely to purchase the majority of Scentsy’s goods.
While Scentsy covers the costs of its Consultants, the majority of the earnings go to the company’s coffers and a few experienced marketers at the top.
The corporation and a select few at the top profit at the cost of everyone else.
An Overview of Scentsy
Scentsy was founded in 2003 on a sheep farm by Kara Egan and her sister-in-law Colette Gunnell, who created wickless candles.
Orville Thompson and his wife Heidi bought Scentsy in 2004 and turned it into a multi-level marketing business. Kara Egan remained a Scentsy Consultant in 2012, with a downline of over 42,000 people.
For that year, Kara Egan’s downline accounted for 20% of the Scentsy salesforce. This demonstrates that individuals who join a multilevel marketing company early have a significant advantage over those who join later.
The business currently has a comprehensive product range, which includes personal care items, laundry care aroma goods, and scented greeting cards, in addition to its main product, wickless candles.
In 2012, the company had $560 million in sales and 218,159 consultants. Each year, the company’s income and the number of consultants has decreased.
With just 131,000 Consultants, Scentsy generated $468 million in revenue in 2018.
Scentsy’s sales are likely to continue to decrease as more people become aware of the reality of MLM.
Statement of Scentsy’s Earnings.
The income disclosure statement for Scentsy is deceptive.
However, a closer study reveals that success as a Scentsy Consultant is statistically virtually impossible.
Scentsy makes the average income of the winners seem much greater by separating the Income Disclosure into two categories, losers and winners.
The DSA Code of Ethics prohibits the manipulation of data.
MLMs are urged to post accurate and verifiable Income Disclosure Statements by both the Direct Selling Association and the Federal Trade Commission.
Prospective independent sellers must be provided adequate information to appropriately assess the opportunity and earning prospects, according to the DSA Code of Ethics.
Former FTC chairperson Edith Ramirez urged that genuine multilevel marketing companies properly portray their business opportunities in an honest, non-misleading, and proven way.
Scentsy does not offer this information, nor does it give any way of confirming its correctness.
Scentsy says in its Policies and Procedures document that a Consultant is not purchasing a business opportunity.
This statement may exempt the business from providing truthful, non-misleading, and verifiable facts.
Scentsy’s Income Disclosure Is Deceptive.
Because I don’t want to infringe on Scentsy’s copyright, I’m not going to post the 2018 Income Disclosure here. If you click Scentsy Income Disclosure, it will open in a new tab for you to follow along with.
The Scentsy Income Disclosure Statement is split into two categories, which is the first and most obvious manipulation. The losers and low-income consultants make up Group 2.
I use the term “loser” to refer to consultants who have clearly lost money.
By excluding the losers and low-income Consultants, the figures in Group 2 seem more significant, giving the false impression that Scentsy can earn a lot of money.
Remember that inactive Consultants will be terminated by Scentsy.
In other words, Consultants who bought a starting kit and goods but didn’t “qualify” by selling $200 worth of merchandise each month were “fired.”
We don’t know how many people were fired or resigned. Most Consultants, according to industry averages, would fall under this category.
The biggest group of individuals that lost money with Scentsy is referred to as Group 2 on the Income Disclosure Statement.
Group 2 consists of 91,813 individuals who earned an average of $239 for the year before business costs were deducted. Group 2’s highest earner took home $18,002.
Scentsy’s figures are deceptive since they include both the majority of people who lost money and left or were fired, as well as at least one individual who earned $18,000.
The $18,000 outlier skews Group 2’s average income significantly.
The skew in Group 1 is much more pronounced.
Consultants who have been with Scentsy for a year or more are in Group 1. There were 41,571 consultants in 2018.
The highest earner earned almost a million dollars ($961,423), while the average income for the year was just $1,989 (before expenditures)!
Annual Commissions in Scentsy on a Median Basis.
The Median Annual Commissions are much more telling.
We would know that the commissions were equally divided from the lowest to the greatest if the Median Annual Commissions and the Average Annual Commissions were the same.
The Median and the Average, on the other hand, are not the same thing.
In reality, the gap between the Median and the Average is significant.
In Group 2, the average income is $1,989.
In Group 2, the median income is $697.
What does this discrepancy mean? It indicates that the majority of the revenue is concentrated at the top of the sales force.
Take a careful look at the average yearly commissions.
Most Consultants with the business for a year or more made less than $697 for the year BEFORE costs were subtracted.
That’s all there is to it!
Is Kara Egan the highest-paid employee?
Kara Egan, one of Scentsy’s founders, has 42,000 Consultants on her downline in 2012.
Scentsy’s salesforce is made up of approximately 32% downlines of that size.
Ms. Egan must be among the top earners in Scentsy if she isn’t the top earner.
At the start of the Scentsy MLM, Ms. Egan became a Scentsy Consultant. Her accomplishment exemplifies the enormous benefit of getting in early.
The Compensation Plan for Scentsy.
I won’t reproduce the Scentsy Compensation Plan since it is protected by copyright. By clicking the Scentsy Compensation Plan, you may open it in a new tab and follow along.
The true goal of the Scentsy Compensation Plan is to make you believe you can earn money. It’s the cornerstone of Scentsy’s recruitment approach.
The Scentsy Income Disclosure, as we’ve seen, statistically shows that becoming a Scentsy Consultant is virtually impossible.
Within investing hundreds of dollars on a starting kit and supplies, the majority of Scentsy Consultants will leave after the first year.
The above-mentioned Scentsy Income Disclosure Statement plainly demonstrates this.
The promise to become “certified for life” by earning $1000 in sales is a risk of the Scentsy Compensation Plan that you should be aware of.
If you produce 1,000 PRV in the first two levels, you will be qualified for life at that levels. What this implies is unclear.
Scentsy’s offer of life certification, on the other hand, seems to be a frantic attempt to product load its new Consultants.
The majority of consultants will purchase a starting kit and goods, fail to generate sales, and either leave or get fired without ever making a profit.
Scentsy is very aware of this.
The promise of lifetime certification seems to be an effort to get a new Consultant to purchase $1000 worth of goods before quitting or being dismissed.
It’s blatant exploitation.
Complaints about Scentsy.
Scentsy has a lot of good ratings online, but it also has a lot of negative ones. Many of the complaints are regarding the goods’ excessive cost and poor quality.
On SiteJabber.com, the majority of evaluations were one-star bad.
Total Rip Off Products, Don’t Waste Your Money, Total Crap, Garbage Company, and Overpriced, China Made Crap are just a few of the headlines on SiteJabber for Scentsy complaints.
“Many Scentsy items may be purchased at Walmart and Hobby Lobby,” one reviewer said.
“I can buy the same items for much less money, practically anyplace else,” said another SiteJabber reviewer.
Indeed.com has over 500 reviews, with a 4.3-star rating on average. The majority of the comments on Indeed.com were from business workers.
However, there are a number of vehement objections from consultants and clients in the mix.
“The goods are expensive,” said one reviewer.
“Too costly, consultant harassment, too saturated and competitive,” said another.
“Too many consultants,” a former Scentsy Consultant said on Indeed.com. My neighborhood was overcrowded. There was no assistance from the home office. You were fired if you didn’t sell enough.”
“Working with Scentsy will cost you more money than you will make,” stated another former Consultant. For little compensation, you’ll spend hundreds of dollars on materials. The firm is unconcerned about its consultants.”
“Can be tough to market since there are so many experts in one area,” another Consultant commented.
“After Scentsy, I’m done with direct sales,” a former Consultant wrote.
In a Q&A of Indeed.com someone answered a prepared questioned about how the CEO of Scentsy could improve the company. Her answer is very revealing about the realities of the business. Here’s what she wrote:
“Stop putting pressure on salesmen and treating them as failures. Remove the required $200 in monthly sales. Nobody could do that without going bankrupt.”
The Final Say on Scentsy
We investigated if Scentsy is a good opportunity in this post and discovered overwhelming evidence that it is not.
It’s obvious that just a small percentage of Scentsy’s customers profit.
Scentsy is a multilevel marketing firm (MLM), which is an antiquated and inefficient business strategy that compels salespeople to pay the organization for the pleasure of earning money.
It also necessitates the exchange of your time for money. Working in a minimum pay job is a better use of your time.
A depressing fact regarding the Scentsy opportunity is revealed in the article The Truth About MLM Businesses and How They Hurt Troops, published on Military.com.
According to the report, most Scentsy Consultants make just the equivalent of three and a half hours of minimum wage each week, BEFORE subtracting company costs, despite four years of trying!
Instead of generating more money, they are hustling harder.
If you’re a Consultant, you’re effectively an unpaid employee since you have to follow Scentsy’s regulations, but you don’t receive any of the perks of an employee.
The difficulty of making money with MLM is becoming more widely recognized online and in the media.
The Multi-level Marketing sector has been in decline over the last ten years. This decrease may be seen in Scentsy’s declining yearly revenue and decreasing salesforce.
Hosting events, making sales, and building a sales team will become more challenging.
Scentsy does not provide anything distinctive. Similar goods may be found online and at large box shops, typically for a lower price.
The demand that Consultants abuse their most trusted connections is perhaps the most damaging requirement of Scentsy.
Making Money in a Different Way
Making more money is seldom the only goal. It’s generally about leading a better life with less stress, more flexibility, and greater security.
Many so-called “opportunities” claim to help you make more money, but the majority are nothing more than false promises designed to steal your money.
It does not have to be this this.
We now have the internet, which is a blessing. Anyone who can go online and write an email can create a website that generates money 24 hours a day, seven days a week.
Yes, it requires effort.
Yes, it may be aggravating at times.
However, the benefits are tremendous!
More money is needed. More liberty. More tranquility.
Allow technology to handle the heavy lifting. That is the sensible approach to increase your earnings.
Rather of exchanging your time for money, use the internet to make money without ever leaving your house.
You can earn more with less work if you use leverage and the power of big numbers.
Consider how self-assured you’ll be if you know you’ll always be able to make money. That is safety.
Affiliate marketing is a good place to start. It’s simple to get started, and it’s inexpensive.
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Please leave a comment below if you’d like to add to the Scentsy opportunity conversation. Thank you very much.
Scentsy is a direct sales company that offers a wide variety of products from warmers, candles, and soaps to wax melts, specialty oils, and even scents. You can earn commissions selling Scentsy products, and you can start by becoming a distributor by joining the company’s affiliates program. The commission structure is one of the highest in the direct sales industry, and the company offers a variety of high-value rewards to its active distributors.. Read more about scentsy horror stories and let us know what you think.
Frequently Asked Questions
Is Scentsy a good company?
Scentsy is a company that sells candles and other related products. They are not a good company because they have poor customer service, high prices, and low quality products.
How much do Scentsy consultants make?
Scentsy consultants make an average of $50,000 per year.
How do I make my Scentsy business successful?
There are many things you can do to make your Scentsy business successful. One of the most important is to have a great product that people want to buy. You should also be able to find a market for your products, and work with retailers who will carry them.
This article broadly covered the following related topics:
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