a LuLaRoe MLM Review – A Fashion Phenomenon Marred by Controversy! SCAM Or Legit?

Welcome to this LuLaRoe MLM Review

If you are fashion conscious and looking for a clothing line that is different, with striking designs that will undoubtedly make you stand out in a crowd, then maybe LuLaRoe is it.

You might have seen the marketing campaigns on Facebook, or maybe you have been approached by a LuLaRoe independent consultant, and it has sparked an interest, and you want to know more.

Whatever the reason I’d like to welcome you to this website because you are certainly in the right place.

Rest assured I am not here to sell you any of their products or the business opportunity that is on offer, but here to give you the facts for you to make a decision whether this is a great business or not.

It’s not all about the products as LuLaRoe like to think they are selling the dream. To help empower women so that they can be financially independent or even financially free.

So, is LuLaRoe a Pyramid Scheme?  Is LuLaRoe a Scam? Is there a LuLaRoe business opportunity worth investing in?

These questions will be answered plus many more so without further ado, let’s get right into it!

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[Affiliate Disclosure: This LuLaRoe MLM Review has been thoroughly researched from information and testimonials that are in the public domain. This post may contain affiliate links which means we may earn a small commission, however, this won’t affect what you pay! 

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LuLaRoe MLM Review – Summary

Product: Lularoe

Location: Corona, California, US

Founders: Deanne Brady, Mark Stidham

Founded: 2012

Website: www.lularoe.com

Product Description: A multi-level marketing company manufacturing and selling women’s clothing.

Cost to join: $499.00

Price of products: $15 – $85

Best For: Experienced network marketers who love women’s fashions.

Recommended: No

Summary: Avoiding MLMs (Multi-Level Marketing) is wise due to their high financial risk and low success rates.

Most participants lose money, as earnings depend more on recruiting others than on actual product sales.

This model can resemble a pyramid scheme and often involves significant upfront and ongoing costs, creating financial strain.

Aggressive recruitment tactics can damage personal relationships and reputations.

Additionally, MLMs face legal issues and negative public perceptions, making them precarious and often unprofitable ventures.

This combination of factors suggests that MLMs are not a sound business opportunity for most people.

So long as you are fully aware of the downside of joining an MLM then let’s continue.

 

LuLaRoe MLM Review – TOC

1. 1. What is LuLaRoe about and who are the founders? 
   2. Is LuLaRoe a Pyramid Scheme
   3. Let’s look at the LuLaRoe products range
   4. LuLaRoe Business Opportunity – What you need to know
   5. What others say about LuLaRoe
   6. What We Like – LuLaRoe MLM Review
   7. What We Don’t Like –  LuLaRoe MLM Review
   8. Is LuLaRoe a Scam?
   9. Is LuLaRoe a Worthy Business to get involved with?
   10. LuLaRoe MLM Review FAQs
   11. LuLaRoe Past And Present Legal Issues
   12. Feedback, Follow and Subscribe

What is LuLaRoe about and who are the founders?

LuLaRoe is a multi-level marketing

business founded in 2012 by Deanne Brady Stidham and her husband Mark Stidham and they are based in Corona which is in California, US.

Initially, they concentrated on women’s fashion, but over the years have extended the product line to include men’s.

In just four years LuLaRoe has catapulted from near obscurity into a 2.3 billion dollar business selling leggings, shirts and dresses through their network of thousands mainly through social media.

In 2013 LuLaRoe became a private company.

The companies fashions tend to be more on the modesty side due to their Mormon beliefs which means that they are missing out on a large market of people who are looking for trendy and sexy.

If you are looking for unusual clothing where you aren’t going to bump into others wearing the same item, then this might be for you, because once they have sold a number of a certain pattern, that’s it.

But, patterned clothes with lots of chevrons, geometric shapes and stripes in a loose-fitting style aren’t for everyone.

So, LuLaRoe’s mission is not just to produce unique clothes that would appeal to many but more about providing an opportunity for people to make money by selling their stylish clothing.

The name “LuLaRoe” came about from their first 3 granddaughters names, Lucy, Lola, and Monroe.

{Our mission is to improve lives and strengthen families through our clothing line. LuLaRoe is a community that instils confidence and bases itself on quality products made you, the customer, in mind.}

Check out this short promotional video coming from Deanne Stidham

As the story goes, Deanne started way back in the early ’90s when she started selling clothing from wholesalers.

She convinced a man who was selling overstock items from major brands to supply her with the stock required to sell in-home parties.

For the next 25 years, she made a living from selling in homes and the word got around amongst stay at home mums.

Known as “The Dress lady” and with a vision which eventually unfolded.

Is LuLaRoe a Pyramid Scheme?

Well, this depends on who you talk to but in

recent times they have been hit with quite a few lawsuits, but then again so have many other MLMs.

These stem from around 2017 and whilst many are about to end up paying hefty fines, they never accept or admit to running a pyramid scheme.

A pyramid scheme would be deemed as such if the sponsor or team lead actually got paid for recruiting others into his/her downline and sometimes that business might hide behind a product or service.

See what Wikipedia has to say here.

Check out this short interview where the owners fight back at claims that LuLaRoe is a pyramid scheme.

Many MLMs end up fighting lawsuits at some point if they are about long enough but with LuLaRoe who have only been around a few years they are going to have to pull out the stops.

Since 2017 the lawsuits have stacked up from their own distributors and consumer advocates in relation to its business model and the way they operate.

Even to the point that the “Washington State Attorney General” in 2019 accused LuLaRoe of running a pyramid scheme.

Let’s look at the LuLaRoe Products Range

One thing you will notice with LuLaRoes products is uniqueness and the chances that you will run into anybody else with the same item is pretty remote.

LuLaRoe best sellers

Due to the nature of their business, bestsellers will change on a frequent basis due to the limited quantities that are made of the same item.

Once that style has completely sold out they will not be any more manufactured.

Leggings do appear to be their flagship product though and look kind of cool if I say so myself.

The LuLaRoe product range can be found within the categories listed below…

1. Womens Collection

2. LuLaRoe Denim

3. Valentines Collection

4. Black, White, Charcoal

5. Elegant Collection 2019

6. Men’s Collection

7. LuLaRoe Vault

8. Limited Edition Capsules Collection

For a closer look at the extensive LuLaRoe product range with current prices…

The full range of products can be found on their official website here.

LuLaRoe Business Opportunity – What you need to know

What you should be aware of is that the number of LuLaRoe consultants in the last couple of years has dropped by around 2/3rds.

With a number of lawsuits since 2017, it would appear that many have or are in the process of leaving.

The problem for many is that they are left with thousands of dollars worth of products that they have stockpiled due to pressure from above and whilst there is a returns policy when leaving many just aren’t able to get refunds.

How to become a LuLaRoe Consultant?

Through my research, I found that many LuLaRoe consultants started their businesses that cost thousands in stock, in fact, one consultant ended up purchasing $10,000 worth of goods.

A few months back you were expected to invest a minimum of $5,500, which is absolutely ludicrous.

In recent times it looks like the startup fee is more reasonable with it costing $499.00 and for that, you get 65 items of clothing.

Plus…Tools and resources…

• • Educating resources…To get you started.
  • Business support. Sale and Tax management
  •  LuLaRoe training
  • Point of sales system
  • Card reader to process card payments
  • Marketing resources
  • Leadership and team support
  • LuLaRoe events
  • Sales incentives
  • Reporting system
  • 5% discount

To be able to join you have to find a sponsor and if you don’t know one anyone will be assigned to you.

In the small print, it says that “A sponsor is an active independent retailer that will guide, inspire and train you”.

Take it from me that if 99% are not making enough for it to become a full-time income then is this the type of sponsor you are looking for?

How to Make Money With LuLaRoe

There are 3 basic ways when you first start this type of business.

1. 1. Purchase the goods at a discount and sell them to family and friends.
   2. Find customers and sell to those.
   3. Recruit others into your team or downline as it is known and make commissions from their sales.

If you want to progress your way up the corporate ladder then you have to excel at recruiting.

There are many other ways that you can make money from…

• • Social media, like Facebook, Instagram, Pinterest, YouTube etc
  • Rent premises
  • Home parties

There are many other ways that are only restricted by the imagination.

With any business nowadays a website should be a number one priority for getting your word out there.

Their teaching methods for getting customers are slow and outdated.

People are already searching in Google for LuLaRoe related things, all you have to do is target those people.

Here you can check out the LuLaRoe Compensation Plan for yourself

Are LuLaRoe consultants actually making money?

Although most MLMs I have found to be devoid of any income disclosures, I did manage to find one for 2016 although it doesn’t paint a full picture.

These are bonuses that you and your team have been paid.

As you can see

• • 72% made no bonus
  • .33% made between $0.01 and $50.00
  • 2.9% made between $50.01 and $250.00
  • 5.07% made between $250.01 and $500.00
  • 4.01% made between $500.01 and $1,000.00

That’s 6.1% who earn over $1,000.00 a month.

What isn’t taken into consideration are the expenses, such as the cost of purchasing stock, shipping costs, etc

What others say about LuLaRoe

Looking on the Better Business Bureau website I found a number of complaints and was shocked to see nearly 400 complaints.

The first 3 are from LuLaRoe independent consultants who have left.

What I like about LuLaRoe

Normally when reviewing a business opportunity

I can usually find a number of positive things to say, but I’m struggling here.

1. Products are unique

2. 6 month warranty period for their products

3. Plenty of resources for helping in your marketing campaigns

What I don’t like about LuLaRoe

I had to restrict the number of negative things

here otherwise it might have turned out a one-sided affair.

1. Not accredited with the Better Business Bureau (BBB)

2. LuLaRoe can be found on other retail sites like Amazon and Walmart

I could never understand this except for one-word GREED. They are certainly not thinking about their independent consultants.

As if it wasn’t hard enough to make sales, but one thing is for certain, you do not have to join  LuLaRoe in order to purchase their products.

3. Expensive

The products are over-priced and better and cheaper products can be found elsewhere and with recognized labels.

4. Poor quality

In recent times I am seeing many complaints about the quality of the products.

What normally happens over time is that suppliers increase raw material costs and therefore the retailer either increases their own retail costs to compensate for it or find other suppliers that are cheaper and often with inferior materials.

5. Many lawsuits

Any business no matter what type it is, if they are around long enough is going to have their fair share of lawsuits, but for a company that has only been around 8 years sure have fallen on hard times.

6. The demise of LuLaRoe

LuLaRoe only came into existence in 2012 and rose pretty quickly in popularity, and maybe too quickly as they peaked in 2017.

So, really LuLaRoe has only had maybe a couple of good years, but since 2017 they have been hit with a stream of lawsuits which has had a big impact on their popularity as can be seen by Google Trends.

Is LuLaRoe a SCAM?

LuLaRoe is not a scam. They are a legitimate MLM business and whilst it is difficult to succeed, it is also very possible to make some money.

They have a large product line that many are raving about.

What people aren’t aware of when they are approached by LuLaRoe consultants is the initial and progressive costs that nobody talks about.

People are listening to BS.

The Dream, of being successful and living that Laptop lifestyle, but very few actually make it.

Is LuLaRoe a Worthy Business to get Involved With?

Well, what do you think? Worth it or not?

As you can see, LuLaRoe is having its fair share of issues, especially with their top earners leaving.

If you are still considering joining this MLM then I would suggest you purchase a few products and check out the quality first, and remember you can purchase them from Amazon.

If this business doesn’t appeal and you are still looking for an opportunity I can highly recommend affiliate marketing.

LuLaRoe FAQs

1. What is LuLaRoe? LuLaRoe is a multi-level marketing (MLM) company that sells women’s clothing, including leggings, dresses, tops, and skirts.

It was founded in 2012 by DeAnne and Mark Stidham and is known for its colorful and unique prints.

2. How does LuLaRoe’s business model work? LuLaRoe operates on a direct sales model where independent consultants purchase inventory at wholesale prices and sell it at retail prices.

Consultants also earn commissions by recruiting others into the business and creating a downline.

3. What are some common criticisms of LuLaRoe? Critics have raised concerns about the financial risks associated with the MLM structure, including high initial investment costs, pressure to recruit new consultants, and potential financial losses.

Additionally, there have been complaints about the quality of products and customer service issues.

4. Has LuLaRoe faced any legal challenges? Yes, LuLaRoe has faced multiple legal issues, including a significant lawsuit from the Washington State Attorney General alleging it operated as a pyramid scheme.

The company settled the lawsuit in 2021 for $4.75 million without admitting wrongdoing.

For further information see the next section in this LuLaRoe MLM review.

5. What is the “LuLaRich” documentary? “LuLaRich” is a documentary series on Amazon Prime that explores the rise and controversies of LuLaRoe.

It features interviews with former consultants, employees, and the founders, providing a detailed look at the company’s business practices and legal troubles.

6. What makes LuLaRoe’s products unique? LuLaRoe is known for its vibrant and unique prints, with a limited number of items made in each print.

This creates a sense of exclusivity and urgency among customers. The company’s “buttery-soft” leggings are particularly popular.

7. What are the financial risks of becoming a LuLaRoe consultant? Consultants often face significant financial risks, including the cost of purchasing initial inventory, ongoing expenses for new inventory, and potential difficulties in selling products.

The income potential is uncertain and largely depends on the ability to recruit new consultants.

8. How has LuLaRoe responded to quality complaints? LuLaRoe has acknowledged past quality issues and has made efforts to improve product standards.

The company has also updated its policies to address customer and consultant concerns, though opinions on the effectiveness of these changes vary.

9. What is the buyback policy for LuLaRoe consultants? LuLaRoe has a buyback policy that allows consultants to return unsold inventory under certain conditions.

However, changes to this policy have led to disputes and legal challenges, with some consultants alleging that the policy was not always honored.

10. Is LuLaRoe still a viable business opportunity? While some consultants continue to find success with LuLaRoe, potential consultants should carefully consider the financial risks and market conditions.

It is important to research thoroughly, understand the MLM structure, and be aware of the company’s history and ongoing challenges.

LuLaRoe Past And Present Legal Issues

Most Multi Level Marketing companies are prone to the odd legal issues and here are a few from LaluRoe.

Washington State Attorney General Lawsuit In 2019, the Washington State Attorney General filed a lawsuit against LuLaRoe, accusing the company of operating as a pyramid scheme.

The lawsuit alleged that LuLaRoe misled consultants about the profitability of selling its products and imposed significant financial burdens on them.

The company was also accused of deceptive business practices. In 2021, LuLaRoe settled the lawsuit for $4.75 million without admitting any wrongdoing which is pretty typical.

The settlement included provisions to compensate affected consultants and required LuLaRoe to make changes to its business practices​.

Class-Action Lawsuits by Consultants LuLaRoe has faced several class-action lawsuits from former consultants who claimed that the company misrepresented the income potential and pressured them to purchase large amounts of inventory.

These lawsuits highlighted issues such as high initial investment costs, difficulties in selling products, and financial losses experienced by many consultants.

Some lawsuits also focused on the quality of the products, citing issues like leggings that easily tore.

Supplier Lawsuit In 2018, Providence Industries, one of LuLaRoe’s main suppliers, sued the company for nearly $49 million.

The lawsuit alleged that LuLaRoe failed to pay for goods that had been shipped.

The supplier accused LuLaRoe of fraudulent conduct, including the transfer of assets to evade payment.

This legal battle drew significant attention to LuLaRoe’s financial practices and internal stability​.

Refund and Buyback Policy Disputes LuLaRoe’s refund and buyback policies have been another source of legal trouble.

Consultants have claimed that the company changed its buyback policy without adequate notice, making it difficult for them to return unsold inventory.

This led to financial strain for many consultants who were left with large amounts of unsold products.

Legal challenges have arisen from these disputes, with some consultants seeking compensation for their losses.

“LuLaRich” Documentary Impact While not a lawsuit, the Amazon Prime documentary “LuLaRich” brought substantial public attention to LuLaRoe’s legal issues and business practices.

The documentary features interviews with former consultants and employees, as well as the company’s founders, providing an in-depth look at the legal and operational challenges faced by LuLaRoe.

The increased scrutiny from the documentary has contributed to ongoing reputational challenges for the company.

Conclusion LuLaRoe’s legal issues have primarily stemmed from allegations of operating as a pyramid scheme, misrepresentation of income potential, quality control problems, and disputes over refund policies.

The company’s settlement with the Washington State Attorney General, multiple class-action lawsuits, and supplier disputes highlight significant challenges in its business practices.

These legal battles, coupled with public scrutiny from media coverage, have had a considerable impact on LuLaRoe’s reputation and operations.

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Until next time, stay safe.