PinkLighthouse.com

active - Term that refers to the status of a Mary Kay Independent Beauty Consultant. An Independent Beauty Consultant is considered active in the month a minimum $180 wholesale Section 1 order is received by the Company and in the following two calendar months. See “qualified team member” for further Consultant status information.

adoptee program - Because of the Company’s no-territory policy, if your Independent Sales Director lives in another city, a Sales Director in your city can adopt you into her unit and, in the go-give sharing spirit, she can provide you with education, inspiration and motivation.

Advance brochure

Explains the sales force career path from Independent Beauty Consultant through Independent Executive National Sales Director, as well as the career car programs.You can access a copy of the brochure through the Mary Kay InTouch ®Web site, or you can obtain a copy from your Sales Director.

advertising and sales promotional materials - Company-supplied literature, supplies and brochures which utilize Company names and trademarks may be used by you in your Mary Kay business. The MKConnections® program offers a number of Company-approved advertising materials to help grow your business. You can obtain business cards and MKChecks™ through the Business Cards, Checks and Stationery program. Mary Kay® logowear is available through the MKConnections® Apparel and Business Gear program. Our experience has shown that personal business contact is the most effective and productive means of generating sales. To avoid inadvertent, false or misleading advertising, no Beauty Consultant or Sales Director should prepare or produce for individual or local use, sales literature, advertisements or promotional materials of any kind in which the Company’s trade name or trademarks are utilized without obtaining the prior written permission of the Company. Approved advertisements you can use for local reproduction at your own personal expense are available on the Mary Kay InTouch ® Community, or upon request from the Company by contacting Global Legal Resources at 972-687-5777; e-mail legalsupport@mkcorp.com; fax 972-687-1604 or write P. O. Box 799045, Dallas,TX 75379-9045.

advertising guidelines - As a Mary Kay Independent Beauty Consultant, you agree to make truthful, accurate representations to your customers and potential team members concerning Mary Kay Inc., the Career Path and Mary Kay® products. The Company, of course, carries full product liability insurance as protection against lawsuits claiming damage arising from any possible defects in the products themselves. However, exaggerated claims regarding earnings or potential product effectiveness, etc., are another matter, and, if untruthful and unsupportable, can involve you in a legal controversy with your customer or government regulatory agencies.

• The customer expects and deserves truth and reliability from you as a seller. Consequently, it is suggested that you carefully examine your sales presentation by asking yourself these questions:
  • Is the information I am giving to my customers contained in Career Essentials or in other Company-furnished literature?
  • If not, what is the source of the information and is it reliable?
  • Is it the truth?
  • Do I have facts to support it?
• Use of Company names for personal business purposes. See “legal considerations.”
  • telephone directory listing - As a Beauty Consultant, you are not allowed to list your Mary Kay business or residential service telephone number in any white or yellow pages directories (whether published by telephone companies or private publishing companies) in any way in connection with the Company-owned trade name, trademark or corporate names. This privilege is reserved for those Sales Directors who have elected to participate in the Company’s yellow page advertising program, and only after an agreement has been executed between the Sales Director and the Company concerning the licensed use of the Company’s trademarks or trade names. Should you need additional information, contact Directory Advertising at 1-800-264-7062.
  • local advertising and promotion - As identified in the Independent Beauty Consultant Agreement, the Independent Beauty Consultant agrees: “To protect the Mary Kay trademarks and trade name by obtaining the Company’s written permission prior to my use in any advertising (including but not limited to the Internet) or literature other than Company-published material. I understand that display or sale of Mary Kay® products in public, retail or service establishments of any kind is inconsistent with the terms of this Agreement.”
  • selling and displaying of products in retail outlets - Selling or displaying products in retail outlets of any kind constitutes a violation of your Independent Beauty Consultant Agreement. Aside from the legal considerations, there are also a number of very important practical reasons why you’ll want to avoid selling through retail-type establishments, such as beauty shops, flea markets, dress shops, spas, etc. Your success with your customer depends upon a very personal relationship: the customer’s ability to try before buying; to receive proper individual instruction in product usage, both before and after the sale; and her ability to rely on the satisfaction or money-back guarantee which only you, as an authorized Mary Kay Independent Beauty Consultant, are able to offer.

Agreement - See “Independent Beauty Consultant Agreement.”

annual Go-Give Award - Award given nationally to Independent Sales Directors to recognize those who exemplify the go-give spirit and Golden Rule philosophy. Five annual Go-Give Award winners, one from each Seminar division, are given special recognition for the Seminar year. The nomination form is available online on the Mary Kay InTouch ®Web site.

Ash, Mary Kay - Company founder.

automated information line - Information on the status of up to 10 of your most recent orders within the last 6 months can be accessed by calling the 24-hour automated Information Line at 1-800-440-5370 and entering your 9-digit Personal Identification Number (PIN; touch-tone phones only). For easy reference, your 9-digit PIN will be your Social Security number. If you do not know your Social Security number or wish to have your 9-digit PIN changed, call Branch Customer Service at 1-800-272-9333. Customer Service Representatives are available Monday through Friday, 8:30 a.m. to 5 p.m., local branch time.

automated retail credit card reimbursement - See “Credit Cards: MasterCard,Visa and Discover Card customer sales” for details.

avenues of income - There are three avenues in which a sales force member can earn income: product marketing, team building and leadership. Team building (recruiting new team members; sharing the Mary Kay opportunity, thus earning personal team-building commissions and bonuses) and leadership (becoming an Independent Sales Director and earning commissions and bonuses) grow naturally out of product marketing. Product marketing is the way a Beauty Consultant builds her business by selling Mary Kay® products:

• On The Face - skin care classes and facials
• On The Go - quick and easy 15-minute appointments
• Online - sales through the Internet
• On Paper - sales through catalogs and brochures
• On With The Show - parties that preview product sets (Collection Previews)
• Awards Night - The spectacular night during each Seminar when Beauty Consultants and Sales Directors are awarded prizes and recognized for their Seminar contest year achievements. Seminar queens are crowned for their selling and recruiting accomplishments.

bar pin - Gold and pavé diamond bar pin displaying estimated unit retail production, awarded at Seminar on Awards Night to Sales Directors who exceed all previous years’ estimated unit retail production (beginning at $300,000 and in $50,000 increments thereafter). beauty book - Brochure that pictures product lines and includes a suggested retail price list. Available as a Section 2 item on the Consultant order form.

Beauty Consultant, Consultant - See “Independent Beauty Consultant.”

Beauty Consultant Agreement - See “Independent Beauty Consultant Agreement.”

booking - Scheduling appointments to share Mary Kay® products.

branches - The five regional Mary Kay distribution centers in the United States that are responsible for shipping products to Beauty Consultants, processing orders and Agreements, and customer service activities. You’ll want to send your order to the branch designated for your state:

• Northeast Branch: P. O. Box 6702, Somerset, NJ 08875-6702, phone: 732-563-9100
• Southern Branch: P. O. Box 100028, Duluth, GA 30096-9428, phone: 770-497-1963
• Western Branch: 6300 Katella Avenue, Cypress, CA 90630-5229, phone: 714-897-6300
• North Central Branch: 221 Covington Drive, Bloomingdale, IL 60108-3114, phone: 630-924-8880
• Southwest Branch: P. O. Box 569190, Dallas,TX 75356-9190, phone: 972-620-1221

Business Tracking Register - A tool to help you keep track of your business expenses. You can learn how the Business Tracking Register works on the Career Essentials Audio Success Series, “Money Management” audiotape. You’ll find the original form in the Success Tools envelope and may make additional copies. Look at the example below which is described on the audiotape (keep in mind that this example is based on 6 percent sales tax; your sales tax rate may vary).

Example 1Business Tracking Register

Month / Year April ’02 Monthly Budgeted Expenses $120

Date	Reason	Deposit Sales (without tax)	Sales Tax	Inventory 50%	Sales Aids 5%	Pref. Cust. 5%	Bus.Income 40%
	Balance Forward	$ 0	$ 0	$ 0	$ 0	$ 0	$ 0
4/20	Class sales	$ 400.00	$ 24.00	$ 200.00	$ 20.00	$ 20.00	$ 160.00
	Total	$ 400.00	$ 24.00	$ 200.00	$ 20.00	$ 20.00	$ 160.00

Let’s build on that example. The next week, April 27, class sales were $250 with sales tax of $15. To complete the entry, you would put:

1. The date and reason for entering money in the Deposit column (you’ll want to include the reason you are moving money in or out of your business checking account).
2. The sales tax ($15) in the Sales Tax column.
3. $125, or 50%, in the Inventory column.
4. $12.50, or 5%, in the Sales Aids column.
5. $12.50, or 5%, in the Preferred Customer column.
6. $100, or 40%, in the Business Income column.

Then you’ll total each column. Based on this example, here is what your register will look like:

Business Tracking Register

Month / Year April ’02 Monthly Budgeted Expenses $120

Date	Reason	Deposit Sales (without tax)	Sales Tax	Inventory 50%	Sales Aids 5%	Pref. Cust. 5%	Bus.Income 40%
	Balance Forward	$ 0	$ 0	$ 0	$ 0	$ 0	$ 0
4/20	Class sales	$ 400.00	$ 24.00	$ 200.00	$ 20.00	$ 20.00	$ 160.00
	Total	$ 400.00	$ 24.00	$ 200.00	$ 20.00	$ 20.00	$ 160.00
4/27	Class sales	$ 250.00	$ 15.00	$ 125.00	$ 12.50	$ 12.50	$ 100.00
	Total	$ 650.00	$ 39.00	$ 325.00	$ 32.50	$ 32.50	$ 260.00

Buying Inventory: Let’s look at what happens when you take money out of your business bank account to buy inventory. In Example 2, your total in the Inventory column (after entering the 4/27 class sales) is $325. If there were $400 in the Inventory column, you could get the 50 percent discount on product (since you would be purchasing $800 in suggested retail). If building up your inventory is one of your priorities, you could use some of the money from the Business Income column toward your inventory. That would look like this:

Business Tracking Register

Month / Year April ’02 Monthly Budgeted Expenses $120

Date	Reason	Deposit Sales (without tax)	Sales Tax	Inventory 50%	Sales Aids 5%	Pref. Cust. 5%	Bus.Income 40%
	Balance Forward	$ 0	$ 0	$ 0	$ 0	$ 0	$ 0
4/20	Class sales	$ 400.00	$ 24.00	$ 200.00	$ 20.00	$ 20.00	$ 160.00
	Total	$ 400.00	$ 24.00	$ 200.00	$ 20.00	$ 20.00	$ 160.00
4/27	Class sales	$ 250.00	$ 15.00	$ 125.00	$ 12.50	$ 12.50	$ 100.00
	Total	$ 650.00	$ 39.00	$ 325.00	$ 32.50	$ 32.50	$ 260.00
4/28	Purchase $400 Whsl. Inv.	$ 0.00	–$ 39.00	–$ 325.00	$ 0	–$ 9.00	–$ 75.00
	Total	$ 650.00	$ 0	$ 0	$ 32.50	$ 23.50	$ 185.00

With this example, you would subtract $75 from the Business Income column and $325 from the Inventory column to place a $400 wholesale Section 1 order. In doing so, you can buy your inventory at a 50 percent discount (see the Consultant order form for the current discount schedule).You will still have $185 in your Business Income column for monthly expenses.

Don’t forget, when you take money out to buy inventory, you must also take the appropriate amount out to pay sales tax. You pay sales tax on the suggested retail price of the inventory and the cost of sales aids. In this example, you must pay $48 ($800 suggested retail price x the sales tax rate of 6% = $48) in sales tax. Since there is only $39 in the Sales Tax column, subtract the additional amount needed which is $9 ($48 - $39 = $9) from the Preferred Customer column. The Preferred Customer column is overbudgeted (since you put 5 percent of all sales into this column but you only need to use it one time each quarter to sign your customers up for the Preferred Customer Program). You can use monies from this column for additional sales tax, the $3.50 call-in charge (if you place your order by telephone) and the $7.50* freight charge. Don’t forget to record these transactions in your Business Tracking Register.

* See the Consultant order form for tax and freight information for Alaska, Hawaii, Guam, Puerto Rico and the U.S. Virgin Islands.

As you probably noticed, by totaling the Business Tracking Register after every transaction, you keep a running total of what is in each column, and you will always know how much you have budgeted in each column for your business. You will also have a running total of your sales in the Sales column.

Each time you put money into or take money out of your business bank account you’ll want to record it on your Business Tracking Register. As you’re using the Business Tracking Register, you will want to determine what your goals are in your business. Which has more priority? Building inventory? Paying yourself? Once you make that decision, you’ll know how to spend and use the money you generate from your business. This tool can really help you improve your business savvy, and it is simple to use!

Helpful Hints For Using The Business Tracking Register:

• When you pay yourself, use the money from the Business Income column.
• Remember, everything that you use and record in your Business Income column to run your business (e.g., expenses, inventory, etc.) ultimately takes away from what you pay yourself. This is your money; manage and utilize it the way you want to so you can get the most from your business.
• Be diligent in recording the money that goes into and out of your business. If you forget to enter some information on your Business Tracking Register, just go back to your business bank account register and record the deposits and withdrawals on your Business Tracking Register.
• Put all earnings from team building directly into the Business Income column since this income represents your earnings.

Beauty book

A brochure that pictures product lines and include their suggested price. Beauty books are less detailed than Look Books and are frequently incorporated into the Consultant’s presentation at a skin care class, show or facial.

Beauty Consultant

See “Independent Beauty Consultant.”

Beauty Consultant Agreement

See “Independent Beauty Consultant Agreement.”

booking

Scheduling appointments to sell Mary Kay products.

branches

The five regional Mary Kay distribution centers in the U.S. that are responsible for shipping products to Beauty Consultants, processing orders and agreements, and customer service activities.

Business Debut

A way for a Consultant to officially announce their Mary Kay business. The Consultant invites a large number of guests and does a “show and tell” of Mary Kay products. She then can book the guests for facials and skin care classes.

Business Tracking Register

A tool to help a consultant keep track of her business expenses.

Cadillac

Career car that a Sales Director can earn the use of by meeting the Cadillac career car program guidelines. See “career car program”.

Car Program Credit

Receive $600 car program credit toward car production, maintenance and requalification for each new personal team member whose initial order with the Company is $600 or more in wholesale Section 1 products, and is received and accepted by the Company in the same or following calendar month that her Consultant Agreement is received and accepted by the Company.

career car - The general description for the cars awarded under the Company career car program, which an Independent Beauty Consultant or Independent Sales Director can earn the use of by meeting career car program guidelines. See “career car program” and “grand achiever car program” for the Consultant career car program. For more information, log on to the Mary Kay InTouch ® Web site.

career car program - The Company award program through which an Independent Beauty Consultant or Independent Sales Director can earn the use of a career car or obtain cash compensation by meeting program guidelines. There are four programs: the Consultant Grand Achiever, Sales Director Grand Achiever, Premier Club and Cadillac. The Sales Director Grand Achiever, Premier Club and Cadillac programs are Independent Sales Director programs only. For more information about program guidelines, ask your Sales Director or refer to the Advance brochure.You can obtain an Advance brochure from your Sales Director or access a copy through the Mary Kay InTouch ® Web site. See also “cash compensation.”

Career Conference - A Company-sponsored conference held each spring in which Beauty Consultants may register to attend for inspiration, motivation and education. Speakers include Independent National Sales Directors and top Independent Sales Directors.

Career Essentials - Educational materials designed to educate new Independent Beauty Consultants about how to start a Mary Kay business. It is included in the Starter Kit. The components include the Starting Points: Beginning Your Mary Kay Business booklet and audiotape, the Reference booklet, Products booklet, Audio Success Series and the Success Tools envelope. The Conversations booklet, which contains useful dialogues and is another part of Career Essentials, is available online. To access the Conversations booklet, as well as the other Career Essentials materials, log on to the Mary Kay InTouch ®Web site.

career guidelines - See “Consultant activity.”

career path program - See Mary Kay Career Essentials Career Path Program

cash compensation - The general description for the cash award under the Company career car program which an Independent Beauty Consultant or Independent Sales Director can earn by meeting career car program guidelines. See “career car program.”

Circle of Achievement, Circle of Excellence - Annual recognition based on a unit’s estimated retail production. Circle of Achievement recognition begins at the $300,000 level of estimated unit retail production and continues in $50,000 increments thereafter (up to $600,000 retail). Independent Sales Directors who achieve $650,000 and above in estimated unit retail production are members of the Circle of Excellence and earn the annual top Sales Director trip. At the $800,000 level and above, Sales Directors earn an exclusive excursion. See “Half-Million-Dollar Circle of Achievement” and “Million-Dollar Circle of Excellence.” See your current Seminar prize brochure for contest rules.

Circle of Honor - Recognition for an Independent Beauty Consultant or Independent Sales Director who achieves 56 quarters of Star Consultant status. She becomes a member of the Circle of Honor and is referred to as a Guiding Star. She is awarded a custom-designed Circle of Honor pin with a diamond pavé ladder. She will continue to receive stars to attach to the ladder, and when 64 quarters have been achieved, she will receive a new centerpiece for the pin denoting 16 years of Star Consultant performance.

Circle of Stars - Recognition for an Independent Beauty Consultant or Independent Sales Director who has achieved a minimum of 32 quarters of Star Consultant status. She is awarded a custom-designed pin and a new ladder pin, both to which the Company will add additional “stars” and gemstones to acknowledge her sales achievements.

coaching - Establishing rapport with your hostess, explaining her role in the success of the skin care class, show or collection preview, discussing her goals for earning products from her appointment, and asking for bookings or prospective new team members. See “telephone coaching.”

collection preview - See “avenues of income.”

commission - Percentage paid to an Independent Beauty Consultant or Independent Sales Director by the Company on the wholesale orders of personal team members or the wholesale sales volume of her unit (if a Sales Director) based upon the products being sold at retail prices. Beauty Consultants and Sales Directors must be active to receive commissions on their personal team members’ wholesale orders.

commissionable, non-commissionable - Terms used to identify whether items purchased from the Company are eligible for personal team and Sales Director commissions. Team-builders and Sales Directors earn commissions based on the wholesale purchases of their team members and/or unit. All items listed in Section 1 of the Consultant order form are commissionable. Items listed in Section 2 of the Consultant order form are non-commissionable.

computer printout - The computer printout which is shipped with the orders you place is provided to all Consultants and Sales Directors to furnish a detailed description of the items shipped, items back ordered and the cost of the order. We suggest that you inventory your product against the computer printout when you receive the order. Any discrepancies should be brought to the attention of the branch from which you received the order. You’ll want to keep the computer printout for your tax records.

Consultant activity - See Mary Kay Career Essentials Consultant Activity

Consultant and Medical Relations Department - Company department for Beauty Consultants to call regarding a customer’s skin problem or about Mary Kay® products. This department also provides information on Mary Kay® products to physicians upon request.

Consultant Power Hour® - An educational audiotape available for Beauty Consultants to purchase on a quarterly basis from the Summary Section of the Consultant order form. Calendar quarter in March, June, September and December.

Consultant product return policy - See “customer refunds and exchanges” for product replacement information. Should a Consultant relinquish her Mary Kay business, she will probably still want to have some merchandise on hand for personal use or for gifts for relatives and friends for future occasions. However, if for any reason, upon cancellation of her Agreement, a Consultant feels she must return her inventory, she may ask for a Request for Repurchase form from her Sales Director. Consultants may contact the Company at 972-919-7767 to determine the amount of product eligible for return. She may then return the completed form, along with her repurchasable Company products, freight prepaid, to Repurchase Department, Mary Kay Inc., 1278 Titan Drive, Dallas, TX 75247. If she is unable to obtain the form from her Sales Director, the Consultant may contact the Company at the number indicated above for a form. The following will apply:

• The Company will accept a Consultant’s cancellation of the Independent Beauty Consultant Agreement within thirty (30) days after acceptance of the Agreement by the Company, and upon the return of the Consultant’s original and unused Starter Kit to the Company, the Company will refund to Consultant the Consultant’s cost of the Starter Kit; or if Agreement is terminated and Consultant’s original and unused Starter Kit is returned to Company after the cancellation period and within one (1) year of purchase, to repurchase such Starter Kit at ninety percent (90%) of Consultant’s original net cost.
• The Company agrees to repurchase, upon the termination of the Agreement, at ninety percent (90%) of Consultant’s original net cost, original and unused Section 1 products, provided such items were purchased by Consultant from Company within one (1) year prior to return.
• Starter Kit and Section 1 products must be shipped freight prepaid, accompanied by a Request for Repurchase form to the Mary Kay Repurchase Department in Dallas.
• Company’s cost of any prizes or product bonuses awarded to the Consultant because of the original purchase and any indebtedness the Consultant owes the Company will be deducted from the repurchase amount.
• Section 2 items are not intended to be purchased from the Company for resale and are not subject to the repurchase obligations set forth in the Independent Beauty Consultant Agreement.
• Any commission previously paid on product returned will be charged back based on the actual percentage paid at the time of the purchase.
• A Consultant who returns merchandise to the Company for repurchase is not eligible to rejoin Mary Kay as a Mary Kay Independent Beauty Consultant.
• Shipment of the products is the responsibility of the Consultant. This includes, but is not limited to, bearing all costs related to the shipment and complying with all federal, state and local regulations.

Consumer Guide to Cosmetic Ingredients - Booklet that provides a listing of all ingredients found in each regular-line Mary Kay® product, arranged in the order required by the Food and Drug Administration. The booklet is available on the Mary Kay InTouch ® Web site.

contest credit - Credit applied in a quarterly contest based on wholesale orders and the number of qualified team members added during a contest quarter.

co-op - The general description for the portion of the lease payment owed by participants in the career car program when production falls short of program guidelines.

courts - Recognition categories for Seminar Awards Night. Achievers are recognized for recruiting and sales. See the current Seminar prize brochure.

credit card sales - See Mary Kay Career Essentials Credit Card Sales

customer profile - Provides a record of a customer’s individual skin care purchases and preferences.

customer refunds and exchanges: The Mary Kay® Product Replacement Program - The Mary Kay dedication to total customer satisfaction enables you to give customer refunds and product exchanges. It is suggested that if a customer is unhappy with a product for whatever reason, you offer to exchange it for another product before offering a full refund. This is to your advantage because you will not be refunding cash, only exchanging product. Many times the customer may be happy with an exchange. Of course, should the customer ask for her money back, cheerfully refund the purchase price for the returned products as soon as you get them. In either case, we suggest you make sure to have the customer sign a receipt, itemizing the merchandise exchanged or refund given.

Our satisfaction guarantee is designed to guarantee the quality of our product and to assure that every customer receives product best suited to his or her skin type. The Product Replacement Program is available to you only after you have honored the Mary Kay satisfaction guarantee by either exchanging product or refunding money. In order to facilitate customer refunds and product exchanges, the Company offers you an easy-to-use Product Replacement Request form (included in the Success Tools envelope and is available on the Consultant order form). You must completely fill out the Product Replacement Request form to receive your replacement product. Complete instructions are on the form. Your Product Replacement Request form may be returned to you if not properly completed.

• Mail the completed Product Replacement Request form to the following address within thirty (30) days of receipt of returned items from customer. Attention: PRP Department, Mary Kay Inc., P. O. Box 569350, Dallas,TX 75356-9350
• Handling of returned items: Product returned to you by a customer should not be forwarded to the Company. For Quality Assurance measures, you should retain the product for a minimum of thirty (30) days from the date you mail the Product Replacement Request form to the Company. After the expiration of the thirty-day holding period, properly dispose of the returned items in accordance with applicable laws and regulations, unless you are contacted by the Company to do otherwise. In the event you are requested to return products to the Company, it is strongly recommended you ship the products through UPS and adequately insure the parcel. This will allow for traceability for compensation should your parcel be misrouted. Shipment is solely your responsibility. This includes, but is not limited to, bearing all costs and complying with all federal, state and local regulations.
• situations that may require refunds or exchanges -
  • A customer buys product, but needs a different formula or does not want it. It is suggested that if a customer is unhappy with a product for whatever reason, you offer to exchange it for another product before offering a full refund. This is advantageous to you because you will not be refunding cash – only exchanging product. Of course, should the customer ask for her money back, cheerfully refund the full purchase price for the returned product as soon as you receive it. To receive your replacement product, carefully follow the Product Replacement Request instructions, including the instructions regarding proper handling of returned items.
  • Customer claims there has been an allergic reaction to a Mary Kay® product. In the rare case when a customer notifies you that she is experiencing an allergic reaction, advise her to discontinue use of all products immediately. Mary Kay Inc. will not accept legal liability for the reaction, since any number of factors affect the skin including diet, illness and physical condition. The customer, by herself or through her Independent Beauty Consultant, must furnish the following documentation to the Company to be considered for reimbursement:
    • Name and address of the attending physician
    • Statement from the attending physician giving an opinion for the cause of the customer’s medical condition
    • Itemized receipts for prescription expenses and doctor bills
    • Once this information is provided, the Company evaluates the information to consider making a payment determination. Information concerning any such claims should be sent to Claims Coordinator, Mary Kay Inc., P. O. Box 799045, Dallas, TX 75379-9045.
    • The medical reimbursement policy does not pay for doctor’s visits “up front.” The customer may be reimbursed after she has been released by the treating physician so we can reimburse for the total cost of medical expenses rather than on a piecemeal basis. The Mary Kay Inc. medical reimbursement policy does not provide for payment directly to a health care provider. Medical reimbursement is paid directly to the consumer.
    • The medical reimbursement policy does not extend to:
      • Patch testing
      • Dermabrasion
      • Cosmetic surgery or any other cosmetic procedure that the customer requests and alleges is needed as a result of using a Mary Kay® product
      • Wage loss
      • Child care/baby-sitters
      • Mileage expenses
      • Housekeeping
      • Other similar expenses
  • Purchases from other Consultants - In the event a customer contacts you and requests an exchange or refund for a product she purchased from another Consultant, you should advise the customer to contact the Customer Satisfaction Department at 1-800-MARY KAY. A representative of the Customer Satisfaction Department will advise the customer how to obtain an exchange or refund.

DIQ - Refers to an Independent Sales Director-in-Qualification. See “career path program” for details.

debut - The completion of Company qualifications for the position of Independent Sales Director or Independent National Sales Director. New Sales Directors and new National Sales Directors are recognized at Company special events and within their own units with special debut ceremonies to celebrate the advancement in their careers.

Direct Selling Association (DSA) - Professional organization of direct selling companies which seeks to promote high ethical standards in the direct selling industry. Mary Kay Inc. is a member of this association.

discount schedule - The Company’s wholesale price to Beauty Consultants on product orders. Determined by a discount from suggested retail prices. See the current Consultant order form for the discount schedule and freight charges.

Double Star of Excellence - Award for an Independent Beauty Consultant who has completed 16 quarters as a Star Consultant.

dovetailing - When a Beauty Consultant is unable to hold or overbooks a skin care class and asks another Beauty Consultant to fulfill her commitment to the hostess, it is called a dovetail.The original Beauty Consultant who booked the class can receive a percentage of the class sales (a suggested guideline would be 15 percent of class sales). All other sales and bookings from the class go to the Beauty Consultant who actually held the class. The hostess remains the customer of the original Beauty Consultant.

dual-marketing concept - An important aspect of Mary Kay Inc. is its dual-marketing system — its separation of corporate management from independent contractors selling the Company’s products. See “marketing plan” for more information.

e-cards - See “Internet programs” for MKeTouch™.

electronic advertising - Consultants may only utilize the Company trademark standardization name and trademarks electronically (i.e., the Internet) through Company-approved programs, such as the Mary Kay® Personal Web Site program. For more information on electronic advertising and the Internet, read the Internet Guidelines found in the Legal Ease brochure. This information is also available online.

e-mail - See “Internet programs” for free Marykay.com e-mail service.

emeritus - An honorary title given to someone retired from an office or position.

Executive Senior Sales Director - See “Independent Executive Senior Sales Director.”

Expense Tracking Form - Form to track your business expenses. Tracking your expenses provides a means to help you control expenses and monitor where your money is going. Consider evaluating where your money is going and spending your money wisely on items that will grow your business. You’ll want to keep every business receipt and put it in an expandable file that is labeled with the categories on the Expense Tracking Form. You’ll find this form in the Success Tools envelope. On a monthly basis you can calculate each category of receipts based on the section headings on this form. Use this information to help you make smart business decisions. To learn how to use the Expense Tracking Form and manage your money, you’ll want to listen to “Money Management” on the Career Essentials Audio Success Series.

Fabulous 50s Club - Independent Sales Directors who achieve at least $30,000 in unit wholesale production within six months of their debut date and have a unit size of 50 unit members or more at the end of the sixth month following their debut date became members of the Fabulous 50s Club.

Face Case - A personalized skin care class trial case. It includes a regular and magnified mirror and can be packed with a foam tray for product samplers and demonstrators. The case is designed to be portable in the GO Kit and/or the GO Book.

facial - Demonstration of Mary Kay® products held with one or two people. The purpose of the facial is to introduce the customer to the Independent Beauty Consultant and Mary Kay® products, as well as teach the customer the correct application order.

family security program - Program that provides participating Independent National Sales Directors with normal, early and late retirement benefits, and disability and survivor benefits.

former Consultant status - See “Consultant activity” for details.

four-point recruiting plan - Mary Kay personally developed the four-point recruiting plan when she began holding skin care classes. By following these four easy steps, you can leave each class with personal prospective team members and referrals. In addition to the hostess and guests at your classes, you’ll want to consider friends, relatives, co-workers and referrals as good sources for potential team members.

1. Ask who might be interested. Before every skin care class and collection preview, ask the hostess, “Who is coming today who might be interested in doing what I do?”
2. Tell your I-story. Present your heartfelt, enthusiastic I-story at every skin care class and collection preview. Share why you began your Mary Kay business and what it means to you.
3. Select at least one person at every skin care class and collection preview and offer them the Mary Kay opportunity. You may want to plant seeds by sending guests home with a Something More audiotape, then meeting with them to tell them more about the Mary Kay opportunity.
4. Offer the hostess a special gift for any person she suggests who becomes a Beauty Consultant.

free Marykay.com e-mail - See “Internet programs” for details.

Future Independent Sales Director - See “career path program” for details.

general liability - This type of policy is designed to protect you from bodily injury, property damage, personal injury or advertising injury liability claims arising out of your activities as a Mary Kay Independent Beauty Consultant. Additionally, if you participate in bridal fairs, etc., you will be able to provide a certificate of general liability insurance to the owner/operator of the premises. Refer to an independent insurance agent in your local area.

Note: To protect yourself against any accidents which a business guest might have while on your property or which you might have on personal property other than your own, you may want to check with your local insurance agent about adding a special amendment to your homeowner’s policy.

GO Book - A streamlined, professional business organizer. The GO Book is designed to carry business cards, pens, customer profiles, datebook, recruiting and product literature along with copies of The Look and product samplers. You can even include a Face Case for an individual facial. The GO Book coordinates with the GO Kit.

Go Give Area - Area composed of Independent Sales Directors who do not have an Independent National Sales Director affiliation. When a National Sales Director becomes an emeritus and doesn’t have an active Senior NSD, the Independent Beauty Consultants and Sales Directors in her area become members of the Go Give Area.

Go-Give Award - Monthly award given to one Independent Sales Director in each of the five Seminar areas to recognize those who exemplify the go-give spirit and Golden Rule philosophies. Name and photo are published in Applause® magazine. Five annual Go-Give Award winners, one from each Seminar division, are given special recognition for the Seminar year. A Beauty Consultant may also receive a unit Go-Give Award.

go-give spirit - Spirit of unselfishness, sharing and helpfulness.

GO Kit - A tote bag professionally designed to carry your product demonstrators and supplies to skin care classes and/or Collection Previews. It contains multiple Quick Zip Bags that Velcro® to the bag, along with ample pockets and storage compartments.

gold medal program, gold medal - Special recognition for sales force members who personally build their teams with five or more new team members in a single calendar month.

Golden Rule - Philosophy of “Do unto others as you would have them do unto you.” The principle upon which Mary Kay Ash founded the Company.

grand achiever car program - Career car program that awards Independent Beauty Consultants and Independent Sales Directors the use of a Grand Am or cash compensation by meeting the career car program guidelines for Consultant Grand Achiever or Sales Director Grand Achiever. Refer to the Advance brochure, available through the Mary Kay InTouch® Web site, for program guidelines.

Grand Am - Career car that an Independent Beauty Consultant or Independent Sales Director can earn the use of by meeting the Consultant Grand Achiever or Sales Director Grand Achiever program guidelines. Refer to the Advance brochure, available through the Mary Kay InTouch® Web site, for program guidelines.

Grand Prix - Career car that an Independent Sales Director can earn the use of by meeting the Premier Club career car program guidelines. Refer to the Advance brochure, available through the Mary Kay InTouch® Web site, for program guidelines.

Half-Million-Dollar Circle of Achievement - Seminar recognition for Independent Sales Directors whose units achieve $500,000 or more in estimated unit retail production during the Seminar year. They receive a choice of one of several prizes. See the current Seminar prize brochure.

Honors Society - Independent Sales Directors who achieve at least $60,000 in unit wholesale production within one year of their debut date and have a unit size of 50 unit members or more one year from their debut date became members of the Mary Kay Honors Society.

hostess - A person who hosts a group selling situation, such as a skin care class or Collection Preview. For more information, see “coaching.” hostess incentive/hostess credit - Allows the hostess to earn Mary Kay® products when she shares her appointment with others. hostess packet - Information that can be given to a hostess when she schedules a class or collection preview.A list of items you may want to include in your hostess packet are:

• beauty books and The Look
• Something More audiotape
• Become Something More marketing brochure
• Your business card
• Suggested dialogue your hostess can use when she’s calling to invite guests to her class such as:
  • I am so excited to call you! I would like to invite you to have a complimentary facial at a skin care class that will be conducted by a Mary Kay Independent Beauty Consultant. The class is by reservation only, and I can invite five friends. If you can come, let me know now so I can reserve a place for you.” or
  • I am so excited to call you! I would like to invite you to a collection preview.A Mary Kay Independent Beauty Constultant will preview the latest products from the Company.You need to only show up and have fun. There will be great refreshments and conversation. Can I count on you to be there?”

You may want to offer the hostess a product credit of 10% of sales from the appointment, 15% for an appointment with one booking, 20% for an appointment with two bookings. Many states prohibit various referral sales plans and some do not permit plans when the earning of the rebate or discount is contingent upon a subsequent event. To comply with these various types of laws which might possibly be interpreted to cover the skin care class and hostess incentive, it’s important to give hostess incentives based on the number of bookings scheduled from the appointments, not based on whether the appointments hold.

I-story - A brief, heartfelt, enthusiastic talk on why an Independent Beauty Consultant began a Mary Kay career and what it means to her.

inactive, inactivity - An Independent Beauty Consultant with no order on record to meet the $180 wholesale Section 1 requirement is considered inactive. See “active.”

Independent Beauty Consultant - Official title for a Mary Kay salesperson, an independent contractor.

Independent Beauty Consultant Agreement - Legal contract between the Company and the Beauty Consultant (independent contractor) which outlines the responsibilities of each.

independent contractor - An independent businessperson who engages in business under the terms of a contract (i.e., the Independent Beauty Consultant Agreement). Independent contractors are self-employed and are in business for themselves. They control the details of their own businesses. They are not employees. They have no power or authority to incur any debt, obligation or liability or to make any representation or contract on behalf of the Company. Mary Kay Independent Beauty Consultants, Sales Directors and National Sales Directors are independent contractors, not employees of the Company.

Independent Elite Executive Senior Sales Director, Elite Executive Senior Sales Director - Sales Director who has eight or more active, first-line offspring Sales Directors.

Independent Executive Senior Sales Director, Executive Senior Sales Director - Sales Director who has five to seven active, first-line offspring Sales Directors.The blouse and/or scarf of their Sales Director suits will be a different color to designate their Executive Senior Sales Director status.

Independent National Sales Director, National, NSD - The top position in the career path. To achieve this status, an Independent Executive Senior Sales Director must have at least 12 first-line offspring Sales Directors with at least six who are also Senior Sales Directors or 11 first-line offspring Sales Directors with seven who are Senior Sales Directors or 10 first-line Sales Directors with eight who are Senior Sales Directors. The units to count toward these totals must meet certain performance guidelines. She must debut as a National Sales Director by age 64 or younger. Appointment to this position is at the Company’s sole discretion.

Independent Sales Director-in-Qualification, DIQ - See “career path program” for details.

Independent Sales Director, Sales Director - Advanced position in the Mary Kay career path. Sales Directors have proven their abilities to successfully sell Mary Kay® products and have demonstrated their abilities to motivate other team members to become successful. They have also completed Sales Director-in-Qualification requirements. Sales Directors are eligible to wear the Sales Director pin and Sales Director suit.

Independent Senior Sales Director, Senior Sales Director - Sales Director who has one to four active, first-line offspring Sales Director(s). They are eligible to wear the Senior Sales Director pin. The blouse and/or scarf of their Sales Director suit will be a different color to designate their Senior Sales Director status. See “offspring, offspring unit.”

insurance plans - See “general liability” and “Product Protection Insurance.”

Internet guidelines - Your Mary Kay business activities and responsibilities regarding the Internet are explained in this document available on Mary Kay InTouch ®Web site. This information is also available by contacting the Mary Kay Legal Department.

Internet programs - See Mary Kay Career Essentials Internet Programs

inventory - Your stock of merchandise — the product you have on hand. You should count your inventory on or as near as possible to December 31 each year in order for you to determine your cost-of-goods-sold deduction (the wholesale cost of merchandise you have sold during the year).