Is Scentsy a scam? Or does this MLM company offer a genuine money making opportunity? This company is all about pleasant fragrances, but worth joining or not?
Let’s take a look and find out….
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Company Name: Scentsy
Owner: Orville & Heidi Thompson
Price To Join: $75 to get started
My Rating: 4/10
~ Scentsy Reviews ~
What Is Scentsy?
Scentsy is a multi level marketing company that was started in 2004 by Orville & Heidi Thompson. The company has since spread into a variety of countries across the globe, with a distributor base of more than 100,000.
Most of the product range is about fragrances, but not of the perfume kind. It’s all about diffusers and plug in warmers, permeating the air with pleasant fragrances from scented oils and wax blocks.
Scentsy also have quite a broad range of other deliciously-scented products and the company has been going strong ever since its inception.
Nothing is sold at retail. Scentsy operates solely under the MLM umbrella for product distribution.
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Scentsy Products
We’ll quickly take a look at some of the products Scentsy has to offer, but I won’t go right into them, as this review is more about whether you can make money with Scentsy from a business perspective.
Some of the product categories include:
- Scents
- Diffusers and warmers
- Laundry
- Cleaning
- Bath and body
- Kids
As mentioned, along with the warmers and diffusers, Scentsy sell scented oils, scented waxes, products for the body, like soaps and lotions, household cleaning products, as well as laundry products.
As an indication of the high prices generally associated with MLM, a half litre bottle of laundry liquid sells for around $25.
One of my pet hates with MLM businesses is the prices they charge, and they have little choice but to charge a lot because their compensation plans force the prices way up.
The Scentsy Compensation Plan
Let’s now take a look at the compensation Scentsy offers its distributor base.
Generally there are always two main ways to make money with MLM:
- Direct product sales
- Recruitment
On direct sales at the lowest level, you earn 20% commissions or mark up. If you get active recruiting – which is really essential to MLM success – then you will earn further commissions from those in your downline.
Each month you have to either purchase for yourself or sell a minimum amount of product to remain “active”. If you don’t, you forfeit commissions and bonuses for the month. The amount is approximately $200 a month.
In order to move up the Scentsy ranks so you can earn more money and bonuses, you need to recruit heavily. Those recruits also have to be very active or they’ll do you or your “business” no good at all.
According to the Scentsy income disclosure, only people at the very top tier of the business are earning enough money annually to be considered earning a fulltime income. All the rest are basically struggling to make part-time money at best.
That’s how MLM typically works, though.
Along with commissions there are various bonuses you can earn both individually and as a team.
Let’s look at the ranks to aspire to in Scentsy:
- Essential Consultant
- Certified Consultant
- Lead Consultant
- Star Consultant
- Director
- Start Director
- Super Star Director
Here’s a link to the rather basic Scentsy compensation plan.
The MLM Business Opportunity
MLM companies really hype things up when you watch their videos or go along to their seminars and meet ups, but in reality, making money with Scentsy or any other MLM venture is really tough for a number of reasons.
The thing people find the hardest is constant recruitment of active members. Because it’s essential to success with MLM – due to how they design their compensation plans – people fail to make money because they can’t recruit on an ongoing basis. It’s really hard work trying to find people to join the business under you, and then they have to be active when they do join.
MLM is popular with companies because they get so many advantages. For starters, they amass massive workforces who all work for no pay, earning money only when eligible for commission payouts and bonuses.
Distributors do nearly all the work, the buying and selling, the promotion and recruiting to grow the company, all for the promise of money down the track. The only people getting rich in most MLM ventures are the ones running the show, and a handful of distributors who got in early and managed to get to the very top. The other 99% basically make hardly any money and put in countless hours of effort.
MLM is deliberately designed to majorly benefit the company, with very little incentive or reward for the army of distributors.
The only real reason so many people are keen to join MLM schemes is because they erroneously believe they are starting their own business, but don’t have to establish the business themselves.
True, it’s all set up and ready to go, but you never own your own business or asset with MLM: The company owns and controls everything. You’re just a sales rep that gets to pay the company a joining fee for the right to represent their over-priced products.
It’s a really, really shitty deal.
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Is Scentsy An Illegal Pyramid Scheme?
No, Scentsy is not an illegal pyramid scheme despite their pyramid design of paying the members. In order to be considered illegal, Scentsy would have to rely solely on the recruitment of new members to generate revenue and have no saleable products. Scentsy does have products, therefore can’t be considered a naked pyramid scheme.
What I Like
- Scentsy has an interesting product range that’s not in the mega saturated health and wellness niche, like so many MLM companies are involved in these days
- The company has been around since 2004
What I Don’t Like
- The products are super expensive
- Distributors are either forced to buy or sell around $200 worth of product every month or they won’t be eligible for commissions and bonuses
- Scentsy basically use their distributor base as the customer base
- The products are no better than what you can buy in retail outlets, just about 20 times more expensive
- Only those in the top rank of Scentsy make what’s considered a fulltime income
- The average annual income for the bottom rung distributors is only about $80 a year
- Recruitment and moving up the ranks is key to MLM success, and that’s where most people – some 95% of people – fail with MLM ventures
How Much Does Scentsy Cost To Join?
At the moment the cheapest Starter Kit is $75. This will give you some business materials, as well as some product samples. You also need to purchase or sell around $200 worth of product every single month to be considered active.
Is Scentsy a Scam?
Scentsy is not something I would call a scam. I wouldn’t call any MLM company a scam that has genuine products. But what I will say is this.
The very nature of the compensation structure is designed to totally favour the company and not the distributors. They sell the deal on the dream lifestyle and making it all sound so easy. They also sell the lie of owning your very own business when in fact you own nothing.
MLM is all about hype and making bucket loads of cash for the company and those at the very top. Most people do everything for the company for free, saving Scentsy millions of dollars in advertising and wages.
It’s a really woeful deal for distributors, and in fact most people could make more profit per month from doing paid surveys online than they’ll make from a MLM scheme. And that’s really saying something.
Forget MLM – Try Affiliate Marketing Instead
I’ve done both MLM and affiliate marketing, and I can tell you in all honesty that affiliate marketing wins the battle hands down.
Here is just a snap shot of the benefits affiliate marketing has over multi level marketing:
No recruiting necessary in order to make great money- No purchasing of products or minimum sales orders to be commission eligible
- Promote all products for all sorts of companies
- Work from home or anywhere you like
- No harassing family and friends to join the business
- No promoting over-hyped and over-priced products
- No limit on your income potential
- Make residual and passive income
- Start an affiliate website and you own it and your business asset
That’s just a small cross-section of the advantages. I’ve written a guide on getting started with affiliate marketing, and you can read it by clicking on the banner below. It only takes 5 minutes and is well worth checking out. Affiliate marketing is way better than MLM.
Darren Burton
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