International Law

The inventory "investment" con in Mary Kay

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"The secret to getting Mary Kay consultants (especially new ones) to order lots of inventory is overcoming their objections.

New consultants typically are skeptical about spending thousands of dollars on inventory that they're not even sure they can sell.

But no need to test the waters and hold a few classes before you order! ORDER NOW! You'll sell tons. Trust me.

And so the con game goes. You want to be successful, don't you?

Would a store open without anything on its shelves?

Do you think women really want to wait for their cosmetics?

Order now. Order often. Have lots on hand and you'll be successful."

I like this a lot because this pitch is the paradigm of fraud. It makes sense, but it is false and designed to relieve you of your wallet.

The networking model of sales makes sense precisely because distributors, sales persons, or consultants don't have to hold inventory. If they did, there would be no overall advantage to the retail model.

So the con relies upon the individual's appreciation of the retail model, all the while selling an alternative distribution scheme.

Very clever.

Full post as published by Misleading Advertising Law on July 16, 2008 (boomark / email).