The LuLaRoe Retailer Bankruptcy pattern is increasing exponentially. Take a look at the screenshot below, and take special note of the “date filed” column. 2017 has seen a significant uptick in filed bankruptcies.
Take a look in the “court” column, the first two letters denote the state in which the bankruptcy was filed. Keep in mind that this is ONLY the actually businesses that filed under “LuLaRoe (Business Name)”. There’s really no way to get the full depth and breadth of this because so many people that were retailers did not have business names or filed as a business. Many of them just did business under their own social security numbers. We will never know the true amount of filings.
In any company, there are some people that are not successful, but that’s typically of their own doing: they make business mistakes or do not anticipate what goes into running a business. But they also have 100% control over their businesses to run as they see fit.
If you’re a LuLaRoe retailer, you do not have 100% control over your business: and it’s ludicrous to tell ANYONE that wishes to join this company that you do.
- You can’t pick your prints
- You can’t sell for less than MAP (although in court documents, Mark Stidham himself said under oath that they do NOT tell us this)
- You can ONLY sell in “approved” places
- You can only SHIP to approved locations (no international shipping)
So, you see, you have minimal control over your “business”. Don’t let LuLaRoe fool you OR tell you that you can’ “run your own business”. Your hands are tied in so many ways that it can barely be called “your” business.
Has LuLaRoe set themselves up to fail? Absolutely. Until July, they were paying bonuses to uplines based on the quantity of clothing that people PURCHASED to resell. Guess what? That’s the definition of a pyramid scheme. Uplines pushed, and pushed HARD, for retailers to “buy more to sell more”, all the while making bonuses on all those purchases. Now that the bonus structure is sales based and uplines have a stiff quota to meet, many have gone out of business because all that lucrativeness is now GONE for them and they actually have to SELL pieces to make money.
Now there’s retailers going out of business and filing bankruptcy. And there has been some attorneys that have talked about the fact that uplines CAN be held responsible for pushing their downlines into debt. I’d love to see this play out in court, just one time.
LuLaRoe has failed people and absolutely wrecked their lives. Divorces, bankruptcy, massive debt……..and they tout themselves as the company that blesses lives.
LuLaRoe, how about you refund all those waiting and just quietly disappear from the Earth before there are more LuLaRoe retailer bankruptcy? That would be a true blessing.
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It is going to be very difficult, if not damned near impossible, for LLR to try to prove that they are not a pyramid scheme in the newest class action lawsuit filed against them by former consultants. Only being able to join as a consultant UNDER another consultant, upline consultants making money off their downline’s sales/purchases, bonuses paid to higher level (mentor, coach, etc.) for their downline’s sales/purchases—all of this reeks of a pyramid scheme. Then there is the employee vs. non employee issue. An independent contractor has the majority of control over how they work. In terms of a clothing re-saler, an independent consultant could sell their stuff wherever, whenever & however they wanted to, could set the prices, could accept whatever form of payment they choose, and could choose their own inventory. The fact that LLR governs how & where consultants can sell, sets the retail prices, chooses what consultants get inter orders and controls how payments can be made is a very strong indicator of an “employer”. Also, the contract that consultants must sign & agree to indicates that LLR can change the policies however & whenever they want—another indication of an “employer”. This lawsuit is going to be an interesting one, to say the least. The fact that they outright lie in testimony, and their lies can be proven to be lies with their own documentation is not good. Denying that they say how much the clothing can be sold for, when the exact opposite is stated in the contract, makes them look really bad. Denying that they don’t have “control” over how the clothing is sold by the consultants, when the exact opposite is stated in the contract, makes them look really bad. It appears that LLR is trying to stay afloat by lying & hoping people involved in the lawsuits (like lawyers) believe the lies (just like all the consultants did for so long). The lies are all they’ve really got, because courts will go by the written contract(s) and all of the changes in policies that were made (without notice to the consultants) that affected corporate & consultants’ finances.
I completely agree. Especially since for the first 4-ish years of their existence, uplines ONLY made bonuses on inventory PURCHASED by their downlines and not SOLD by their downlines. This was the main reason that they changed the bonus structure. And they touted this as if it was a BIG favor to us and how they had already paid bonus on that product and they were so committed to this new bonus structure that they were willing to pay bonuses again.
LIES. They did it to try to keep their asses out of hot water. And it’s NOT working.
I also had perfect credit before I got into this Co 9 mo it took us down. And hurt our family so much