Mary and Jane are two women who caught the Mary Kay fever and decided to become consultants. (While Mary and Jane are fictictious, their experiences are based on those of hundreds of other women.)
Mary doesn’t want to start her Mary Kay “business” with that “empty wagon” Mary Kay Ash mentioned, so she orders $2400 (wholesale) of inventory. Now she’s set and ready to start selling.
She holds her first “class” and is happy to have a few orders. But as she proceeds to fill those orders, Mary is suddenly dismayed. Two of her customers ordered several of the same lipsticks (or eye shadow, eyeliner, blush, moisturizer…) and Mary only has enough of those shades to fill part of the order. Now what?
Mary has a few options:
1. Order additional inventory from the company: But this means that Mary will have to pay the flat shipping amount just to receive a few additional items. That shipping charge makes the cost of those few items much higher.
2. Trade with another consultant: Although not talked about much, this is a very common practice among consultants. If you’re out of a moisturizer that you need, you swap products of equal value with another consultant.
3. Call your director and buy it from her: This is strongly discouraged by the company, but it’s done all the time anyway. If you’ve ever seen the endless shelves of inventory that a director has, you know why they’re more than happy to sell product to consultants. Many discount it slightly less than what you’d pay if you ordered from the company.
4. Have your customer wait for weeks until you’ve sold enough to have at least a $200 wholesale order to justify the shipping cost: Not the best option.
Meanwhile, Jane decided that she wasn’t going to buy any inventory when she became a consultant. She held classes and took orders, promising delivery within two weeks.
Jane holds a few classes but doesn’t sell $400 retail. She needs to order at least $400 retail ($200 wholesale) to get her 50% discount, so she orders a few extra things to get the order total up. Her order arrives in a week and her customers aren’t bothered by waiting for their product.
Over the next few months, Jane doesn’t hold any classes and has a few individual appointments. But the orders from those appointments aren’t very large. Still, Jane orders the product from the company and pays the flat shipping charge. She realizes that she can’t keep doing small orders every few weeks or that shipping charge will eat into her profit.
At the beginning of the next Mary Kay quarter, Jane’s “earned” 50% discount expires, which means she has to order at least $400 retail from the company initially during that quarter to get the 50% discount on her product. One of Jane’s customers calls her and needs a lipstick. But Jane hasn’t been selling much because she’s been busy at her “real” job and had some family issues to tend to. She doesn’t have the lipstick, since she doesn’t carry inventory, but she doesn’t need to, or want to, order $400 worth of product just to get one lipstick. And if she just orders the lipstick, she not only won’t get the discount but she’ll pay the flat shipping charge on that one item.
These dilemas are what women who’ve been in Mary Kay have faced.
The more you build your customer base, the more likely you are to run dry on certain items. So you order more inventory and keep more of each item. And still, with thousands and thousands of dollars on your shelves, you run out of something. Even if you decide to stock only what your previous customers have purchased and use regularly, it still happens.
It’s a tricky balancing act that’s nearly impossible to perfect.