Monday, December 10, 2007

Executive Income vs. Success vs. Real Life Survival

Wow


MY BAD


Some of you were itching to dispel the ridiculousness effervescing from a certain segment of the www, and I left you no opportunity. I do apologize. And yes, it is quite outrageous today! More on that in a bit.


New policy… everyday will have a “today on PT post” for anyone that wants to throw something up there! I simply do not have an opportunity until after work to catch up on the entire goings on and respond. Please help me by dropping your thoughts “while I am out”.


The format that would be most beneficial of course would be to “quote” the phrase, statement, or paragraph in question and then leave your thoughts after the “quote”.


Now onto the subject at hand.


Warning, what follows is a rant that has been a long time coming. Grab yourself some hot cocoa, (coffee if it is already tomorrow morning for you) put on some classic Christmas music, sit back, relax and enjoy...





That being said, there are two posts on PT today that bear rebutting. It is SO amazing that no one disagreed with what was said! Oh wait, they can’t!


They are both similar enough in content that I will discuss both here and allow you to dole it out as you see fit.


First, there is the issue of a $10,000 unit not being an “executive income”


Then there is the issue of “hope” being one of the obstacles to “recovering” from the nightmare of Mary Kay. This is really only a thinly veiled dig at the “odds” of making it big in Mary Kay.


Glossing over the fact that I can’t stand “The View” (perhaps it is because I am male, but I know plenty o’ the female varieties that can’t handle it either), the fact that involvement in Mary Kay is not ALWAYS a life tragedy (some would argue it is rarely so) and the fact that Mary Kay is NOT a Pyramid scheme, I STILL have a major problem with her LOGIC here.


On both subjects, on many levels, there are so many inconsistencies with this logic that it will be hard to encapsulate them all into one post.


  1. If you only brought $240,000 worth of product sales to the table at any company, it is HIGHLY unlikely that they will pay you much of anything. Perhaps if you have a base salary, but don’t expect a commission at that level. Think of a car salesman at say a Toyota dealership. Your average vehicle sale is say $20,000. (That is what the customer pays) The dealership might make $5,000 on that sale. From that sale, they have to pay, overhead, stocking fees, etc. You most likely have a Sales Manager, a General Manager, and a Store Owner that all want to get a little bit of that and finally, you get your “cut”. I promise you that if you only sell TWELVE of those cars in a year, you are NOT going to be earning a living much less an “executive income”


I don’t care what industry, if you are only selling $240,000 worth of product at the retail level, you are not going to be making “good” money. Companies reward sales people for a certain level of performance. They reward their “executives” on an entirely different basis. If you have a sales team that together sold $1,000,000 in a year, now you might be looking at a different story. Now every industry is different, but the point is the same. $10,000/month may seem like a benchmark, and indeed it is a good goal to set, but if you think that is going to earn you that “executive income” whatever that is in your mind, brace yourself! Not to mention, if YOU bought more than half of that product yourself and aren’t going to sell it, that would be the equivalent of our Toyota sales guy buying himself a new Toyota every other month, just to meet his “one a month” quota. It just doesn’t make sense.

  1. This is compounded by the fact that what she is pointing to as a “problem” with Mary Kay is really a truth about LIFE. One of her first commentators quips,


“Another way to think of it is this way (and this is if my math is right):


Take 5,000 women at random. Ok, now one of them steps forward. That's your odds of succeeding.


1 / 5000 = 0.0002
0.0002 x 100 = 0.02%”


I live in Los Angeles, so this may not apply to all of you, but if you were to take any section of our population and grab 5,000 people, you would be LUCKY to find 1 that was making an “executive income”. The cold hard truth of life is that whatever you pursue, you are not “likely” to get to that golden tier you are aiming for. This is why that level of achievement is called things like, “coveted” “desirable” “enviable”. You don’t just drop into it. I am curious about these people that started an MK business, left it and found a $50k+ job… just like that. What do you do? Seriously… most entry level jobs DON’T pay that much. Period. If you are making that kind of cash right out the gate, you almost ALWAYS have to have at least a Bachelors Degree.


I am not saying that they don’t have one or that they are lying. I am simply saying on behalf of those that don’t have that to fall back on, OR don’t have a husband making enough for them to sit at home all day, “how dare you”. Congratulations that you didn’t NEED Mary Kay, and when you got sick of it you could toss it aside like a rag and spend the remainder of your days *****ing about how terrible it is/was for you, but for the rest of us that have to get up and work a hard day + some every day just to survive this cold hard world, “give us a break”. Yes it is a lot of work. What do you think we mean when we say, “man it’s a lot of work, but at the end of the day I love it”? (***** = whine or gripe or bleat or whatever you feel fits best)


  1. Let’s do the numbers for someone (for the sake of argument) that doesn’t have a further education degree, doesn’t have a parent/friend that “knows somebody” and can only find a $15/hour job answering phones. Let’s further suppose that she is fortunate enough to get a position where she gets a full 40hrs/week. $600/week - $31,200/yr - $2,600/mo. I will let you all do the math for your own personal experiences, but if you have kids, you know the drill. If you have to commute, that commute is every day. If you want to buy lunch, you can’t write it off. If your car breaks down, you fix it. This is also “pre-taxes” You might get a break on health insurance, but a lot of times, you just get the “group rate” Et. Al. $15/hr is still almost countrywide at least double the minimum wage. (exceptions include Connecticut, Oregon, Vermont, and Washington and in January – California
  2. I said it on their site already; my wife’s director doesn’t spend any of her commission checks on the business. She covers all of those expenses with her income from her own personal sales. She doesn’t take any money from those classes for herself (to my knowledge). One of them asked me,


“So after you factor in prizes, training center rent, room fees, 4 trips a year (Seminar, Leadership, Career Conference, & Fall Retreat), Directors suit, Interviews at Starbucks or wherever, bussiness expenses, office expenses, postage ETC ETC ETC. you mean to tell me she pays for ALL THAT out of her personal product sales? Then you have to assume she is in the Queens Court of Sales to fund all the cost that Directorship entails.”


I was banned, so I could not answer there, but I will here.


Yes, in fact she was The Queen of Sales for our… whatever you call the seminar group… district? region? She works her business really hard, and sells a lot of product. She is most definitely the best consultant in her unit. And as to the other comment from the same,


“If that is true- that you have decided not to buy anything that can't be paid for with money she has hasn't already brought in with sales- then that explains why her Director isn't encouraging her to go for Directorship.”


She IS encouraging her to go for directorship. Just not until she has her team ready. Is that really so hard to imagine? A director that WANTS her team to succeed?


I have said it before, I will say it again. Mary Kay is a sales organization. (it is also a manufacturing… well whatever, you get the idea that I am talking about what WE do.) Sales organizations make their money from SALES. They reward their SALES people when they SELL things. If a leader pulls together a team and gets them to SELL more than they could have by themselves, this leadership is rewarded. The fact that people CAN take advantage of and manipulate this scenario does not mean:


1. Everyone does


2. It is the fault of Mary Kay Corporate


3. You have to


Again, sorry you had no recourse to comment on these erroneous posts earlier. Some people have posted comments here if you would like to read them. As mentioned, I will try my best to put up a post every morning that is simply called Today On Pink Truth. Feel free to “quote something there” and then comment on it. Please “quote” at least the portion you are talking about so that those who have a hard time viewing that site will know what you are talking about.



14 comments:

  1. David, well, I guess you have joined the ranks of most of us. We go along patiently trying to say, yes, it can be done honestly and ethically, yes, you can make money, you must be smart and make good decisions, you do not have to use people and can truly care that they succeed the right way,you need to be smart about your expenses, you should not buy production, we acknowledge there are some doing it wrong but we don't condone it. And then wham you read it absolutely cannot be done. I broke down my month in an early thread on your site, if one does the money, it is for real yet, I must be lying because a few people that admit to doing things the wrong way couldn't make it work. Most of the time it doesn't bother me, I just want to share my examples because I know how fortunate my family is because of my MK career and my flexability that I would hate for someone looking for information and only see PT and miss out on what could be the opportunity of a lifetime. At least with pro and con examples, one may may an informed decision.

    If there was no place to read an offset to their horror stories, one may believe they were true.

    Rant away...

    ReplyDelete
  2. Another problem I see here is the push for me was recuiting, not selling. My director recuited someone at my debut. After that I never let her speak to a customer. Sales did not seem to matter. She would prefer to recuit someone instead of sell to them.

    The woman she recruited at my debut was a friend of my mothers. I have known this woman all of my life. She flits from one job to another frequently. One month she may open a store, the next she's selling vests she saw in Mexico, the next it's some foreign fruit drink that cures cancer and such. She was all set to buy the cleanser, moisturizer and day and night solutions. Had her ticket filled out, check made. Then my director informs her that if she signed up she would get those products plus more for almost the same price. What? Huh?? This woman had no intention of selling MK. And she never placed an order after that. She used the product at my debut, liked it, and wanted it. Was prepared to pay for it. But she got recruited instead. And now when I see her, frequently, I get the evil eye because my director kept calling her about making her first order. (And she wants to recuit me into the fruit juice selling business!) The calls have stopped, but she wants nothing to do with MK, or the products. If she would have been kept as a customer I could have made alittle that night, and possibly sold to her after that.

    My point is, sell first. Recuit much later. And not everyone is a recruit!

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  3. GOOD MORNING ALL!!!

    Oh my goodness when I read this post yesterday I was so something that I couldn't even believe it.

    On thing that the poster of pt left out is the fact that yes you have expenses in this business you also have write offs.

    The poster listed all the expenses.

    Meeting space
    gifts
    travel to conferences
    suit
    yada, yada, yada

    I am not a tax professinal however some of these expenses are tax deductable. If you have an accountant that is worth their beans they will use all of your deductions. I know that taxes however there are deductions.

    I can not beleive that people will look at the post and be mislead. I am so sick of these pters posting their"truth" and not allowing the real truth.

    If you work for someone esle do you get to write off your mileage? "NO" If you work for someone else do you get to write off you conferences that they make you attend "NO" the company does that you work for. Do you get to write off a portion of your eletric, do you get to write off a portion of you mortage, do you get to write off a portion of your house being painted or your lawn being mowed or your entertainment expesnse (well maybe this one.) How about you phone bills, internet expense. One more expense that this poster said is health insurance guess what if you are self employeed that is a write off too. Oh my!

    To get a clear picture let's make sure that we get all the information and not some half witted information from someone that HATES MK. I get so sick of all the "Oh Mk did this to me and that to me" We are grown woman and if you can't see things that aren't right and move on well I don't know what to tell you. If you can't see through all of their BS then I don't know what to tell you.

    You know one year I think it was year before last my MK business saved me from having to pay taxes. I think that we need to look at the whole thing instead of just one side of the story.

    Yes it takes money to run a business and that is what these women are not seeing this is a BUSINESS.

    Ok I will stop I just want the whole truth and not just some irriate woman ranting.

    HAVE A GREAT DAY

    ReplyDelete
  4. Judi, I couldn't agree with you more here! If someone wants to buy the Miracle Set, by all means let her have it! You get $50! I have been to events where I've heard other directors talk about recruiting like this. It's Russian roulette (sp?) to recruit that way. It's a shot in the dark recruiting someone after an attempt at one sale--you don't even know if she'll work. That is why Mary Kay Ash said, BOOK, sell, BOOK again, THEN recruit. Someone's willingness to host classes and parties reflects whether she might be good at selling the product because a hostess is supposed to help you sell her friends on buying the product and booking their own classes.

    A friend of mine built her team with silent hostesses. They realized how easily they could get orders for my friend and decided why not do it for their own profit? These are the kinds of tactics we are really supposed to use in building our team. This way, people get some hands on experience before signing up.

    Now, I've gotten a couple team members who came to a guest event and left as consultants, but I wasn't heavily pursuing them to join. It just kind of happened. Some never ordered, some did, but now none are consultants. They do continue to order the products from me. Another indication I do something right--they don't hate MK, they don't hate me, and they still want the product. To me, that is still success. I still have a loyal customer.

    And Judi, if my director recruited someone who was about to order a full Miracle Set, I'd SCREAM! Oh, and are you referring to a juice called Xango? Just curious. I had the sheer joy (sarcasm) of being stationed next to their table at a mall event I did. They stood in front of my display with their juice. And any time someone was looking at my table and filling out my entry slips they tried to steer them away. Crazy! How rude! lol! But, I'm sure that not every person who is involved with Xango elixir behaves as those women did; just as not everyone in MK behaves as badly as described on PT.

    ReplyDelete
  5. She sold NONI first, then Xango. And yes, like most people who rely on sales, she is nuts!

    I had a good CPA do my taxes while in MK. I deducted the heck out of everything. Was depressed when I saw what was left after working so hard.

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  6. speaking the real truthDecember 11, 2007 at 12:59 PM

    Judi brings up another good topic, the "Business Debut". I do not do these as a practice, for many reasons.

    First of all, new consultants need to see classes/parties held, not product intros. If I just help her with her first class, she sells product and she learns alot about what we do, which is hold appointments.

    Secondly, if she invites everyone that she knows and goes to alot of trouble and no one shows, it is very discouraging. A simple skin care class requires little prep or expense for the new consultant.

    If you recruit her friends and family at her debut, you just handicapped her. Those would have probably been her first appointments. Help her to build customers, appointments, and sales first, then recruits from those appointments and sales.

    Mary Kay Ash did not speak about the business debut, she encouraged us to take new consultants to OUR appointments. The problem is that directors/recruiters are not holding enough of their own appointments. The debut takes the pressure off of them, and puts it on the new consultant. That is not wise.

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  7. Judi, how many years were you a consultant? 1? 2? 5? (sorry if I missed it somewhere else) I am just curious because this is my 4th year in the business and I am expecting to show very little loss this year and possibly profit. I took a huge loss my first year which makes sense because I was new and had no idea what I was doing. I still showed a loss my second year. Last year I didn't work and, therefore, didn't claim anything on my business because I sold less than $1000. Wedding planning was more important. ;)

    This year I have been working more, although not as consistently as I would like. I see this year as a turning point because I know I have sold more this year than any other because of what I've built in the past 4 years of my business. I'm eager to see what tax time tells.

    Pink Bren, I know what you are talking about. I never got much money back from the gov't at tax time until I started MK. The first year I was in MK, it actually helped me because I would have owed a bit, but my business reduced what I had to pay.

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  8. My lucky number was 3. Years. I worked my butt off! I was not lazy. I lost money the first year. The second and third years I did not order unless I needed $400 worth. I swaped out with other MKers. Why order all that if you don't know you are going to sell it? Yes, it canceled out some taxes, but no where near compensated my time and effort. And it only gives a break on SOME of the money you've spent, a percentage. I never understood how loosing money in a business was a good thing. You still spent the money. It's gone and you didn't get it back if you lost money in this endeavor.

    I can't believe you are not making money after 3 years. Why do it? I did not see a reason to. My friends were not in MK. One started with me, but she quit before I did. I had a co worder in MK, but we were not not friends outside of work. There was no reason to keep me there if I wasn't making money. I am not understanding why you stay, if you are not being compensated. Please explain, shadesofpink.

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  9. I didn't say I wasn't compensated, Judi. I showed a loss my first two years and didn't work last year. I expect to show a profit this year--even if it's small. If I show a loss, I'll be surprised. This year, I HAVE made money because I paid our bills with MK money while my husband wasn't working. Am I making thousands? No. But an extra $250 to pay his car payment and another $300 to pay his insurance is profit in my book. Especially when my day job money is paying MY car, the mortgage, utilities, groceries, etc. He's working again now so I hope things get easier soon.

    In my previous post I said I expect to show profit this year. It may not be much, but all of my original inventory debt has been PAID OFF which means I now KEEP every penny I profit in my sales. Yes, it took a few years, but that is typical in any business.

    Why do I keep doing it? I enjoy it. I like doing skin care classes, meeting new people, and introducing the products. Also, I'm still learning. I'm not a born salesperson. Sales is really an art. I have to try a little harder than others to pull it off, but I'm getting better at it. Even if I don't achieve directorship, I will still continue to sell to the customers I have.

    You have to think about why it would appear as a loss, too. I placed a few large orders in my second year in anticipation of some larger appointments I had scheduled. The appointments wound up canceling. So, I ordered more than I actually sold. HOWEVER, I follow a payment pattern for paying on my debt. So, let's say I still owed $900 from my initial inventory. I would pay $150/mo every month on my card. If I don't sell more than $300 in a month, I'm just breaking even as far as paying toward the debt. Now, if I have a great month (great is relative--great for me might suck for someone else) where I sell $800, I profited $400. I STILL PAY $150 to my debt and keep the rest to pay bills or treat us to dinner whatever. That's compensation, but I'll show a loss at the end of the year if I have more slow months than good months. Also, if I place an order for $400 in anticipation of an event, that will put me at a loss. If the debt I owe is up to $2000, my payment is $150/mo. I have extremely low APR. The good months are enough to keep me motivated because if I can do it consistently, I won't have problems.

    I'm still figuring it out. And the fact that I don't have any more debt tells me I'm making progress. It's a learning process. For example, I learned not to order in anticipation of results. I order after I make the money. I made a money mistake and I learned from it and it didn't break me. It's all paid off. Oh, and no one suggested I order that and no one pressured me to order. I made my own business decisions good or bad and learned from them.

    This year I learned that I can control my earnings. When we were having difficulties earlier this year, I was able to sell product and make those bill payments. I was even able to hold a few appointments.

    I can believe that after 3 years I'm not making a huge profit:

    1. I joined for fun. I wasn't married when I joined MK. I was only working part time and due to a lack of funding, I lost my other p/t job teaching dance.

    2. I didn't sign up for the sole purpose of making money. I signed up because I had too much spare time on my hands after quitting dance and I was exploring many different things to replace that with. I guess I was reinventing myself.

    3. I love the products, I get them at cost, I share them with others.

    4. I have a lot of drive. I don't give up easily. I want to figure out how I can be successful at this so I can then help others.

    5. My reason for joining was more about the social aspect than money.

    6. I don't have to work very hard to make a little money. I can send an email out to my existing customers and sell a couple hundred dollars when I need money. I don't even have to beg.

    7. MK is refreshing and acts as a way to escape some of the negative aspects of my life.

    I could go on and I may elaborate in a more organized fashion over on my own blog later. For now, Hubby is taking over the computer for a bit. Ciao. :)

    ReplyDelete
  10. RE: Sales vs. Recruiting.

    Safe to say, "Book, sell, book, sell, recruit"?

    Moving on... Judi,

    I am trying to get a picture of what caused you to lose money.

    What do you consider working your butt off? Were you working 40 hrs/wk? 20? 60? more? less?

    What kind of work did you do? I know that you didn't get training from your director, but what kind of work were you engaged in?

    Where were you looking for new customers? Public places (malls, busy streets, professional buildings, eateries)? Phone Calls? Referrals?

    What were your ratios? If you called 10 people, how many booked? Of the ones that booked, how many held? Of the ones that held, how many bought? How long did it take to call those 10 people?

    I am not saying you have to answer those questions here, but have you analyzed it? Have you given much thought to the kind of work that you did? If I went out in my backyard and "worked hard" digging holes because I had heard that working hard would make me a lot of money, I would be deeply disappointed when my results were back pain, holes in my yard and no money. If I kept at it for three years, my fortune would not reverse.

    There is such immense variety in the way that Mary Kay can be successful for people that it should be hard for anyone to say, "see, it is not working for you".

    To simplify it, lets use two ways of "success" in Mary Kay.

    1. Six figure income
    2. Hobby level for enjoyment

    These are probably the two "extremes".

    The problem on BOTH sides of this conversation is that people mix these two concepts.

    You CAN make 6 figures +

    You CAN work as little as you want.

    You CAN'T work 5 hours a week and make 6 figures.

    I believe that some recruiters imply this.

    I believe that Pink Truth bases their complaints on similar accounting. (they point at the ones on the "hobby level" and say, "see their losing money" and the ones making money and say, "see, their working sooooo hard")

    If you have a regular job and your "hobby" job "loses" you money every year, that CAN be a good thing.

    If you want to be aggressive and build a business, you CAN achieve the "executive income".

    It IS bad that recruiters are telling people that they can mix those two and get the same results. No one on this site is denying that. But the point is that if you keep them separate (as they should be), there really are many options to enjoy working for this company.

    And thus we come around full circle to the reason I started this site!

    I did the math in the comments on the other post, but basically, if you want 6 figures, you probably need to have a unit that produces 3/4 of a million. 13% of $750,000 is around $100,000.

    Is that a lot? Yes! Can it be done? Yes! Will everyone get there? No! Is there anything stopping YOU from getting there?

    ReplyDelete
  11. I am not implying this is what has happened to Judi but I have watched (even on times been guilty of it) there is a major difference between actually working and putting alot of thought into thinking about working. You can think and talk about Mk 24 hours a day and really tire yourself out but until you are doing skin care classes and facials, how much work are you really doing?

    speaking the real truth, I tried a few business debuts when they were newer and went back to my way. I always do the first class with the consultant. I find it works great for building our relationship and I know I do a good class and then a good closing so the sales tend to be higher than if I had let her do it on her own and then it is easier for me to set up their second appointment by telling them why we do it and then how it will also help the new consultant. They are usually very happy to book and help her out but I think it is easier that I am asking them then if the consultant tried. So by doing this I know she has great sales and her first bookings set up and she got training and I can thank her friends for supporting her and ask them to be her cheer leaders. It works great. If she then still wants more training on classes, I am always willing to bring any of my unit members to my parties with me.

    And.... I might as well as it - I do not try to recruit her customers, I want her to get going and then after she gets selling then she can start building.

    ReplyDelete
  12. What do I mean when I say I worked? I do not mean that I thought about working.

    I called every beauty salon in a 60mile radius. My director gave me a script for this. Even the little salons. They were in the business of beautifing people, so was I. Let's work together. You already have customers, I want some. I'll give you a discount on the best selling brand. There was a little interest, but nothing took off.

    I warm chattered. And I was sincere about it. I didn't walk up to gross people and compliment them. It was always attractive, put together women.

    I never left the house without my MK pins. I wore the MK pin, the ladder, and what ever other ones I won from ordering.

    I had fish bowls in 2 cities at a time. Usually 4 in each city. I called every single person who put their name down. Most did not hold. In the beginning with the fish bowls I just did the standard "Enter to Win". And, of course, everyone won. But I didn't find they were inviting people. So I added incentives. The hostess got a 10% discount for each guest she had who ordered. That worked but I never got a big class (say, 6-10 people) where people bought $50 each. The majority of my people did not actually invite others.

    I did make some cash. Thankfully, my husband worked, paid for all our bills. I wanted to pay for vacations. So I was not looking to make six figures. But three would have been nice.

    I was on the phone for 3 hours everyday, while my little one napped. I recruited my sister to help with placing the fishbowls in her city and checking them every couple of days. I paid her 10% of what I got from her bowls. I did SCC on Saturdays and after my husband came home from work during the week. My mom was available to watch my little one if I had a class during the week, during the day.

    I can understand why these classes didn't hold. I personally LOVE tupperware. It's all I have in my cabinets. But I will not host a class. Even to get a discount. I can totally understand why peole didn't want to host a SCC. It's hard to schedule people to come to this type of event. They know they will get the recuiting speil. And when you are off of work you don't want to leave your family to go hear why you should sell MK, or tupperware, or any of those other MLMs.

    So, yes, I did work. I did make some money. But not nearly enough for the amount of time I spent earning it.

    ReplyDelete
  13. Judi, I would say you did work your butt off! :) I don't work my butt off. That is the difference. It sounds like your results were similar to my results, but the difference is you put far more time and energy into it than I do. I tend to only try really hard if I want to place an order and I have success with this. Now I am promoting more often because I'm more reliant on the extra money.

    When I placed my initial inventory order, I used a 0% credit card. I was able to transfer the balance a few times to other 0% cards when the promotional APR expired. By the time I would no longer have 0%, I was pretty much paid off. I have never worked my business to the point where I consistently hold 2 classes/wk, but I do sell products every month--enough to make the necessary payment on my card. As long as I was able to do this without dipping into my regular income, I had no reason to quit. Now I'm all paid off and any money I make can be used beneficially for our household.

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  14. Judi, out of curiosity, are you still pursuing Mary Kay as an income option? I think that you still really want the dream and are totally frustrated that it continually seems to elude you. From your comments I detect no belief that what you have to offer is beneficial to your hostesses or customers, only that they will feel used or pressured. Your work ethic and determination are so commendable, my heart aches for you that your success was not, in your own eyes, commensurate with your efforts. Are you still working your business or have you moved on to greener pastures?

    ReplyDelete

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