In a significant policy shift, LuLaRoe, a leading player in the direct sales fashion industry, has updated its return policy, leaving many consultants feeling vulnerable, especially those contemplating exit strategies from their businesses. The recent changes have sparked considerable concern amongst LuLaRoe sellers.
Earlier in 2017, LuLaRoe had instituted a policy allowing consultants designated as “going out of business” (GOOB) to return unsold inventory for a full refund, including shipping costs. This initiative was designed to mitigate the financial burden on consultants during their exit process and to discourage the practice of holding GOOB sales that could disrupt market pricing. However, as of the latest announcement, LuLaRoe has reverted to a policy which now stipulates a 90 percent refund on returned items, while also eliminating coverage for return shipping expenses. This alteration could result in significant financial losses for many consultants.
Furthermore, a petition has emerged, urging LuLaRoe to honor the previous 100 percent refund policy for those who had already initiated the GOOB process prior to the announcement. LuLaRoe asserts that the recent changes align with their pre-April policy, claiming that the earlier, more lenient refund terms were only a temporary measure.
The revised policy now maintains stricter criteria for returns, including only accepting items purchased directly from LuLaRoe, thus excluding items traded among consultants—a common practice in the network. Additionally, returns are limited to merchandise bought within the past year and must be in pristine condition, a stipulation that complicates matters for consultants who typically display products at home or during sales events.
Moreover, LuLaRoe will no longer accept returns on seasonal or discontinued items, which presents a considerable challenge for those left with unsold holiday-themed inventory. Given that consultants have no control over the specific patterns they receive when ordering inventory, this policy change adds significant risk to their business operations.
Consultants initially invest substantial capital to join LuLaRoe, with entry packages ranging from $4,812 to $6,784, and are encouraged to replenish their inventory regularly. This new policy poses additional hurdles for those seeking to liquidate their assets. LuLaRoe maintains that they provide a reasonable and fair exit strategy for Independent Fashion Retailers, reiterating the long-standing policies agreed upon at the outset of their business relationship.
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In summary, LuLaRoe’s updated return policy has left many consultants scrambling to adjust to the new limitations that could significantly impact their businesses. As they seek ways to navigate these changes, resources for family planning and fertility may provide helpful support.