Hit docu-series, LuLaRich, explores how the multi-level marketing scheme convinced mums on Facebook to 'girl boss' their way into selling leggings and recruit other women along the way...
Last week, LulaRich aired on Amazon Prime. A four-part docu-series about billion-dollar clothing empire LuLaRoe, the documentary explores the accusation that founders Mark and DeAnne Stidham misled thousands of women to become retailors of their multi-level marketing (MLM) scheme – or, as the lawsuit against them alleges, a pyramid scheme. And boy, does it get wild.
But first, a brief history: LuLaRoe is a fashion company best known for its bright-coloured, quirky leggings perfect for middle-American mothers busy lifestyle. When you visit their website though, you’ll notice the homepage is filled with promises beyond getting your hands on the latest legging trend. ‘Join LuLaRoe’, ‘Be Part Of Our Family’ and ‘Business Opportunity’ are all prominent taglines, emboldened by the LuLaRoe motto: ‘Creating Freedom Through Fashion’
So, what exactly are they selling? A retailor opportunity, it seems. That’s what LulaRich explores, how LuLaRoe went from selling leggings to convincing thousands of women to join their salesforce, invest in inventory and if you want a slice of the pie, convince new sellers to join on too.
You can see where this raised some eyebrows. Now just wait till you hear what the women who joined LuLaRoe as retailors have to say. Accusations levied against the company – which amassed over one billion in sales in 2016 - include sellers being pressured into weight-loss surgery, told to max out their credit cards and even sell their breastmilk in order to afford new inventory.
Yes, seriously.
A lot of people lost their marriages, their lives were in shambles.
‘A lot of people lost their marriages, their lives were in shambles, people were selling breast milk for start-up costs – are you kidding me?’ LaShae Kimbrough Benson, who started as an administrative assistant at the company’s headquarters in 2015, told The Guardian. ‘People were taking out loans, all kind of stuff. And [Mark and DeAnne] knew that.’
How did they get women on board with then? By appealing to their inner ‘girl boss’, it seems. According to LulaRich director by Jenner Furst, the company appealed to ‘middle America millennials who don’t have the same opportunities that their parents had, who are facing a lot of different struggles, who are susceptible on one hand to the patriarchal nuclear family structure but then also the pitch to be a girlboss and to be empowered and to be a feminist who is selling these leggings.’
In the docu-series, several former LulaRoe retailors – dubbed ‘Consultants’ – agreed with this notion, saying the company used shallow feminist language like ‘boss babe’ and promises they could work ‘part-time for full time pay’ to convince women they could run their own business from home while still having time for their kids.
‘They saw me, they’re like she’s bubbly, she’s energetic, she knows how to use social media, she’s an asset to moving this forward,’ Roberta Blevins, a former consultant at Lula Roe, told The Guardian – comparing the grooming process to love-bombing. ‘At that point, I was just another walking dollar sign.’
Blevins says was convinced to join LuLaRoe by a woman selling their leggings on Instagram who said she bought them wholesale from the company and sold them for double the price. Before long, Blevins had paid $9,000 (£6.5k) to become a consultant and receive a starter package of clothing to sell. While she initially made money, she said the company’s emphasis on recruiting new ‘consultants’ and the ‘bonus checks’ received for that put a strain on her. Soon, she was questioning everything, including the company events that seemed more like religious celebrations - where Mark would recite from the Book of Mormon – describing the environment as ‘very culty’.
While LuLaRoe has been sued multiple times since 2017, not just by consultants but consumers of their products too – and their chief clothing supplier Provident Industries, the company denies wrongdoing in all suits. Most recently, in January 2019, the Washington State Attorney General's Office filed a suit against LuLaRoe alleging that it is an illegal ‘pyramid scheme’, makes misleading income claims and encourages its consultants to focus more on recruitment than selling clothes to customers.
If you’re unfamiliar with MLMs, that’s how they skirt around the usual pyramid scheme legalities: MLMs are legal in the US as long as they sell a product rather than a membership, have a buyback policy, and prohibit buying new inventory until retailers have sold 70% and have at least 10 new customers.
In February 2021, LuLaRoe settled the Washington lawsuit for $4.74million (£3.5m) with the funds set to be shared between LuLaRoe distributors in the Washington state. They denied any wrongdoing, however the settlement now explicitly prohibits the company from operating a pyramid scheme and demands measures to improve transparency, including a requirement to publish accurate income disclosures.
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FAQs
In early 2017, a class-action lawsuit was filed against LuLaRoe by customers, who complained that the firm's proprietary point-of-sale software incorrectly calculated sales tax rates on interstate sales, and in jurisdictions that do not charge sales tax on clothing.
What did LuLaRoe get in trouble for? ›
“LuLaRoe tricked Washingtonians into buying into its pyramid scheme with deceptive claims and false promises,” Attorney General Bob Ferguson said in a statement.
Is LuLaRich a true story? ›
While growing up in Panama City, Florida, her mother had also fallen prey to a multilevel-marketing company she believed could save her family's finances. That background inspired her to produce LuLaRich, an Amazon docuseries about LuLaRoe's rise and fall, premiering September 10.
What is the documentary on Netflix about LuLaRoe? ›
Experts in the documentary reflect on how LuLaRoe seduced thousands of recruits, some of whom ended up risking their homes, their bank accounts, and their relationships with close family and friends - all in an effort to be their own boss by selling LuLaRoe leggings.
Is LuLaRoe out of jail? ›
Brazil's former president Lula walks free from prison after supreme court ruling.
Is LuLaRoe still in business today? ›
IsLuLaRoe still in business today? Yes. They are still attempting to make their business work in a more positive light. As of May 2022, LuLaRoe has managed to get its rating up to a “C” by the BBB.
How many people lost money with LuLaRoe? ›
Ferguson said of the case: “LuLaRoe tricked Washingtonians into buying into its pyramid scheme with deceptive claims and false promises. As a result, thousands lost money and two individuals made millions from their scheme.
What is the most famous pyramid scheme? ›
Bernie Madoff: The most famous Ponzi scheme in recent history—and the single largest fraud of investors in the United States—was orchestrated for more than a decade by Bernard Madoff, who defrauded investors in Bernard L. Madoff Investment Securities LLC.
Is LuLaRoe a Mormon company? ›
The Founder is a Member of the Church of Jesus Christ of Latter Day Saints. DeAnne Stidham is the founder of LuLaRoe. She owns the company jointly with her husband Mark.
What religion is LuLaRoe? ›
Very early on we learn that LuLaRoe's founders, Mark and DeAnne Stidham, are LDS members. Although the company was secular, the founders' religious identity was also central to its operation.
LulaRoe and lululemon are NOT the same company. In fact, they have two radically different business models. Practically the only thing that these brands have in common is the “L's” in their names and the fact that they sell leggings.
Do any of the sister wives sell LuLaRoe? ›
"So, the real answer as to what do I do for my businesses - I sell LuLaRoe." She then went on to explain what that means, and what she does. "It's lots of fun, and on weekends like this I get to come and hang out with all my people.
What is the movie LuLaRich about? ›
LuLaRich chronicles the rise and fall of the LuLaRoe leggings multi-level marketing company.
Is LuLaRich still on Netflix? ›
No, LulaRich isn't part of the Netflix slate. It is now streaming exclusively on Amazon Prime Video.
What is so special about LuLaRoe? ›
LuLaRoe clothing is unique.
LuLaRoe only makes 1,000 pieces in each pattern or design. That's split up between 20 different styles available with the brand. That's also split between the thousands of LLR consultants so the odds of you having the same shirt or skirt as someone else in your town…
Do people make money with LulaRoe? ›
Direct Sales
Inventory, which is purchased at wholesale, can then be sold for a profit by marking items up anywhere between 35–50% (though LulaRoe is very strict about using a minimum advertised price for online sales). This places most products in the $35–$65 range, with many falling closer to $35.
How much does it cost to buy in LulaRoe? ›
Getting started is easy! To start your business, complete the online registration and make your initial purchase of $499 for 33 pieces of select styles (retail sales value of $1,228). Once complete, an onboarding team member will contact you to help choose your items!
How many retailers are left in LulaRoe? ›
In a recent Instagram post, LulaRoe said they have 17,000 active retailers, a far cry from the 80,000 they had back in 2017. Of those retailers, the income disclosure statement shows that about half made less than $5,000 in product sales and bonuses (now called the "Leadership Compensation Plan").
How many LuLaRoe consultants are there now? ›
That means that despite the deluge of bad press, lawsuits, and former retailers consistently trash-talking the company online, there are still approximately 18,000 women and men who sell LuLaRoe.
Is LuLaRoe in debt? ›
LuLaRoe is facing mounting debt, layoffs, and an exodus of top sellers, and sources say the $2.3 billion legging empire could be imploding. The letter F. An envelope. It indicates the ability to send an email.
However, when LuLaRoe began stretching production to meet unsustainable demands, the quality suffered. Now, retailers are finding mismatched seams, unflattering pattern placements, broken zippers, and other severe complications.
Is Rodan & Fields a pyramid scheme? ›
Rodan + Fields has its headquarters in San Francisco, California. Its products include cleansers, toners, moisturizers, creams, exfoliators and sunscreens. Rodan + Fields distributes via multi-level marketing, which has been criticized by consumer advocates as akin to a pyramid scheme.
Why is Mary Kay not a pyramid scheme? ›
Why is MaryKay not Considered a Pyramid Scheme? Even though the Mary Kay Company does play some emphasis on recruiting, they place more of an emphasis on selling their products which is the hallmark of a legitimate MLM.
Is Avon a pyramid scheme? ›
Avon: MLM or a Pyramid Scheme? To note, while Avon is known to have been an MLM rather than a Pyramid Scheme, it is still important to know how one can differentiate both terms. MLM is a business model wherein a brand can recruit representatives and sell products where they can earn commissions – you know the rest.
What corporations does the Mormon Church own? ›
The following are DMC subsidiaries:
- Beneficial Financial Group: insurance, investment, and retirement services.
- Bonneville International Corporation: owns radio stations nationwide, Bonneville Interactive, and Bonneville Satellite Company.
- Bonneville Communications (Boncom): Advertising agency.
Mormon attitudes towards gender
Mormons believe that men and women are fully equal as the spirit children of God. The place of woman in the Church is to walk beside the man, not in front of him nor behind him. In the Church there is full equality between man and woman.
Is dot dot smile part of LuLaRoe? ›
DotDotSmile was founded by Nicole Thompson, the daughter of Mark Stidham and DeAnne Brady Stidham. The children's clothing line was also sold alongside LuLaRoe's standard collection of adult-sized clothing. For years, LulaRoe was considered among the most successful multi-level marketing companies.
Who is the head of LuLaRoe? ›
Mark Stidham is the Chief Executive Officer and Co-Founder of LuLaRoe, one of the nation's fastest growing fashions brands.
Is LuLaRoe successful? ›
According to The Wall Street Journal, LuLaRoe grew to a business generating $2.3 billion in retail sales in the span of four years thanks to its ever-increasing team of “retailers” who were mostly mothers seduced by the promise of financial success that could be reaped by buying and selling LuLaRoe merchandise from the ...
What country owns Lululemon? ›
Founded in Vancouver, Canada in 1998, lululemon athletica is a technical athletic apparel company for yoga, running, training and most other sweaty pursuits. While Vancouver, Canada is where you can trace our beginnings, our global community is where you'll find our soul.
Founded by Chip Wilson in Vancouver, Canada in 1998, lululemon is a yoga-inspired, technical athletic apparel company for women and men. What started as a design studio by day and yoga studio by night soon became a standalone store in November of 2000 on West 4th Avenue in Vancouver's Kitsilano neighbourhood.
What company owns LuLu? ›
Lulu Hypermarket is owned by LuLu Group International. LuLu Group International also owns Twenty14 Holdings, which owns hotels across the world.
Where is LuLaRoe now? ›
LuLaRoe settled with the state in February 2021 for 4.75 million dollars. Today, the company remains in business, although according to the docuseries, many “LuLa-famous” independent retailers have closed up shop.
Did Kody and Janelle split? ›
The couple is currently separated. In a recent trailer for a “Sister Wives: One on One” special which aired in December 2022, Janelle revealed that she and Kody have been separated for months.
How much does Mary make from LuLaRoe? ›
Although it has not been revealed how much Meri makes as an trainer for LulaRoe, a multi-level marketing company she has been a part of since 2016, Glassdoor reports that a trainer makes over $77,000 a year.
Where can I watch the new LuLaRoe documentary? ›
Watch The Rise and Fall of LuLaRoe - Season 1 | Prime Video.
Where can I watch LuLaRich for free? ›
Watch Lularich (2021) Online for Free | The Roku Channel | Roku.
Where can I watch LuLaRich episodes? ›
Watch LuLaRich - Season 1 | Prime Video.
Is Meri still with LuLaRoe? ›
Meri Brown Shocks Fans With Continued LuLaRoe Partnership.
Does Meri still work for LuLaRoe? ›
Due to their fame, Christine and Meri are surely bringing in a lot of new clients into the LuLaRoe system. While this could be possibly bad for certain victims of a potential pyramid scheme, this means that Meri and Christine are still making a profit.
Right now the majority of retailers participate in “Takeovers”, where they go to another retailer's store and do a Facebook Live sale where you sell other retailer's inventory. Then, whatever you sell, you purchase at wholesale from that retailer.
Why are LuLaRoe leggings so soft? ›
Other soft leggings are 170 grams, single brush, and then print without yoga band. LuLaRoe leggings are 190-200 grams, which means they have more yarn. We do more than 1 brush. This technique is what creates the super soft feel of the leggings.
Is LuLaRoe a good company to work for? ›
LuLaRoe Rankings
LuLaRoe is ranked #10 on the Best Companies to Work For in Corona, CA list.
Are there still lawsuits against LuLaRoe? ›
Even after settling a major lawsuit with Washington state by agreeing to pay a $4.75 million fine, LulaRoe still has dozens of unsettled lawsuits against them.
What is going on with LuLaRoe now? ›
LuLaRoe settled with the state in February 2021 for 4.75 million dollars. Today, the company remains in business, although according to the docuseries, many “LuLa-famous” independent retailers have closed up shop.
Do people make money with LuLaRoe? ›
Direct Sales
Inventory, which is purchased at wholesale, can then be sold for a profit by marking items up anywhere between 35–50% (though LulaRoe is very strict about using a minimum advertised price for online sales). This places most products in the $35–$65 range, with many falling closer to $35.
What is the religion of the LuLaRoe owner? ›
Very early on we learn that LuLaRoe's founders, Mark and DeAnne Stidham, are LDS members. Although the company was secular, the founders' religious identity was also central to its operation.
Is LuLaRoe and Lululemon the same company? ›
LulaRoe and lululemon are NOT the same company. In fact, they have two radically different business models. Practically the only thing that these brands have in common is the “L's” in their names and the fact that they sell leggings.
How much does it cost to buy in LuLaRoe? ›
Getting started is easy! To start your business, complete the online registration and make your initial purchase of $499 for 33 pieces of select styles (retail sales value of $1,228). Once complete, an onboarding team member will contact you to help choose your items!
