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Scentsy
Company typePrivate
Industrymulti-level marketing
Founded2003
Founders
  • Kara Egan
  • Colette Gunnell
HeadquartersMeridian, Idaho, United States
Area served
North America, Europe, Australia and New Zealand
Key people
Heidi Thompson (CEO), Orville Thompson (CEO)
ProductsScented products
Number of employees
1,056 (2018)[1]
Websitescentsy.com

Scentsy is a United States-based multi-level marketing[2][3] company that sells scented products including wax warmers.

History

Scentsy was founded by Kara Egan and her sister-in-law Colette Gunnell in Salt Lake City, Utah in 2003.[4][5] At a small business event in 2004, they met Orville Thompson, a struggling entrepreneur who had previously started several unprofitable business ventures.[6] Thompson took an interest in the pair's wick-less candle company and a few months later, he and his wife Heidi Thompson purchased the company from Egan and Gunnell.[5][6][7] The Thompsons moved the company's headquarters to Meridian, Idaho and on July 1, 2004 they re-launched Scentsy using a multi-level marketing distribution model.[5][8][9]

Marketing materials for Scentsy were created by a Layton, Utah-based graphic design company, ScentsySuccess (an authorized division of Ann Dalton Design Inc.). ScentsySuccess was acquired by Scentsy in 2008, at which time they moved to a new distribution centre and showroom in Layton.[10]

In 2009, the company expanded into Canada and in 2011, the company expanded into the United Kingdom and Germany.[11] In 2012, the company had over 170,000 active independent consultants.[12] At the end of 2015, this number had fallen to 95,891.[13] Co-founder Kara Egan remained with the company as a consultant and had over 42,000 down line consultants as of 2012.[12][4]

In 2017 the company reported over $450 million in annual sales, putting it as number 44 on Direct Selling News' list of the top direct selling companies in the world.[14][15] It was also on the Forbes magazine 2011 list of America's 100 Most Promising Companies and the 2018 list of America’s Best Midsize Employers.[8][14]

Business model

Under the multi-level marketing (MLM) model used by Scentsy, all products are sold exclusively through independent consultants, with no retail sales.[12] Consultants can also receive a portion of the sales of any new consultants that they recruit.[16] In a 2011 interview, CEO Orville Thompson said that they chose a direct selling model because their wickless candles were "an experiential product" that were best showcased in home-based parties and that MLM distributing allowed them to offer a larger selection of products than was possible to offer in the limited space of a retail store.[7]

Scentsy has been criticized for its heavy recruitment of American military spouses, whose families' frequent moves mean they often have trouble finding consistent employment.[17][18][19] The military humor site Duffel Blog satirized this practice by announcing the creation of SCENTCOM, "focused on unifying efforts of highly scented products sold on military bases through 'consultants.'" [20]

According to its 2015 income disclosure statement,[13] about 66,000 or 65% of active Scentsy consultants receive an average of $463.34 per year, before expenses. The top 200 or about 0.2% consultants, earned an average of $113,363.98, with the highest income earner making nearly 1 million dollars.[21] According to a military.com article, it takes most consultants over four years to earn a yearly income equivalent to working three and a half hours per week at minimum wage, not counting business expenses.[17] The blog Bottlesoup calculates that a consultant will have to sell 639 Scentsy products per month in order to earn the equivalent of a full-time, minimum wage job.[22] An analysis by The Finance Guy blog, claims that 99.45% of Scentsy consultants were not able to earn a full-time income.[3]

Scentsy was profiled in a study about the rhetoric used by companies in the 'direct selling industry'.[23] Scentsy's recruitment material was noted to emphasize personal agency within the context of Bormann's fantasy theme analysis and convergence theory.

See also

References

  1. ^ "Scentsy on the Forbes America's Best Midsize Employers List". Forbes. Retrieved 2018-03-30.
  2. ^ Snider, Susannah (June 12, 2018). "What to Know Before Getting Involved in an MLM Company". U.S. News & World Report. Retrieved March 3, 2019.
  3. ^ a b "Can You Make Money With Scentsy". The Finance Guy. 5 August 2017. Retrieved 2019-03-30.
  4. ^ a b Home.org, Business For (8 August 2012). "Kara Egan – Scentsy Top Earner Interview". www.businessforhome.org. Retrieved 2019-03-31. {{cite web}}: |first= has generic name (help)
  5. ^ a b c "Inside Meridian-Based Scentsy". Boise State Public Radio - StateImpact Idaho. Retrieved 2019-03-30.
  6. ^ a b "Scentsy founders share their story". KIVI. 2018-05-18. Retrieved 2019-03-30.
  7. ^ a b "Scentsy CEO on Thriving in Rough Economy". Fox Business. 2011-05-05. Retrieved 2019-03-31.
  8. ^ a b "#66 Scentsy - Forbes.com". www.forbes.com. Retrieved 2019-03-30.
  9. ^ Beech, Holly (11 October 2011). "Scentsy's profits continue to rise sharply". Idaho Press. Retrieved 2019-03-30.
  10. ^ Olson, Debbi (8–14 September 2008). "Home-fragrance firm to open distribution center in Layton". The Enterprise. 38 (11). Salt Lake City, Utah: [1], 12.
  11. ^ Beech, Holly (5 October 2013). "Scentsy celebrates growth with new Meridian campus". Idaho Press. Retrieved 2019-03-30.
  12. ^ a b c Littman, Margaret (2012-06-02). "Scentsy and the Sweet Smell of Success". Entrepreneur. Retrieved 2019-03-31.
  13. ^ a b "Scentsy Income Disclosure Statement 2015" (PDF). Retrieved 2019-03-30.
  14. ^ a b "Scentsy on the Forbes America's Best Midsize Employers List". Forbes. Retrieved 2019-03-30.
  15. ^ "DSN Announces the 2018 Global 100!". Direct Selling News. 2018-05-03. Retrieved 2019-03-30.
  16. ^ "Scentsy Compensation Plan Chart | How to make money with Scentsy | Buy Scentsy Online". Retrieved 2019-03-31.
  17. ^ a b Burke, Crispin (2018-01-30). "The Truth About MLM Businesses and How They Hurt Troops". Military.com. Retrieved 2019-03-30.
  18. ^ Shellnutt, Kate (2016-05-12). "Why your Facebook feed is filled with women selling essential oils and press-on nails". Vox. Retrieved 2019-03-30.
  19. ^ Mondalek, Alexandra (2018-05-29). "Why MLMs Are So Appealing to Military Spouses". Racked. Retrieved 2019-03-30.
  20. ^ blondesoverbaghdad (2016-10-14). "DoD stands up SCENTCOM to unify home-based businesses". Duffel Blog. Retrieved 2019-03-30.
  21. ^ "Direct sales gigs: How much can you make being your own boss? | CTV News". www.ctvnews.ca. Retrieved 2019-03-31.
  22. ^ "Living the Dream: Selling Scentsy". BOTTLESOUP. 2019-03-06. Retrieved 2019-03-31.
  23. ^ Martin, Sarah E.; Rawlins, Jacob D. (October 2018). "Stories they tell: the rhetoric of recruiting independent consultants". Journal of Business and Technical Communication. 32 (4): 447–479. doi:10.1177/1050651918780196. ISSN 1050-6519. S2CID 65006466.
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