How Much Are Lularoe Leggings Wholesale

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LuLaRoe generated $1.8 billion in sales in the last year.Instagram/@lularoe LuLaRoe is launching a massive refund program in response to customer complaints that the company's leggings "rip like wet toilet paper" and develop holes after as little as a few hours of wear. The 4-year-old company, which sold $1.8 billion in clothing in the last year, said Tuesday that it would issue full refunds for any defective merchandise purchased between January 1, 2016, and April 24, 2017.

Customers can get the refunds through the 80,000 people who sell LuLaRoe clothing — whom the company calls "independent retailers" — or directly from the company online. LuLaRoe is also implementing a so-called happiness policy that's intended to make it easier for customers to get refunds, credits, or exchanges for purchases going forward. "We listened and we heard the feedback from social media and our consumers and even from our retailers," LuLaRoe CEO Mark Stidham told Business Insider.

"If someone has spent money on one of our products, we want them to feel that they got value for that money they spent." Customers have shared hundreds of photos online of ripped LuLaRoe leggings.Laura McIntyre Business Insider reported in February that hundreds of customers were complaining about holes developing in leggings, which are LuLaRoe's most popular product. Customers also claimed that many retailers — who buy clothing at wholesale prices from LuLaRoe and then sell it at a markup to friends and family on Facebook and at parties in their homes — wouldn't allow them to return defective merchandise.

At the time, a Facebook group devoted to sharing stories about the damaged leggings had more than 1,400 members. It now has more than 26,000 members. One month after Business Insider's story, two LuLaRoe customers filed a class-action lawsuit accusing the clothing brand of ignoring customer complaints and knowingly selling defective clothes that "rip like wet toilet paper" to enrich the company's top executives.

Stidham says LuLaRoe's unhappy customers represent a tiny fraction of its total customer base. "It's statistically insignificant — it doesn't exist," he said, comparing the several hundred complaints lodged against LuLaRoe on the Better Business Bureau's website with the 17.5 million garments that the company sold in March alone. "At the same time, I don't want to be flippant about that." 'I don't feel we have much to apologize for' Stidham said the refund program and new policy did not represent an apology or a change of course for the company, but rather reinforced that LuLaRoe stands behind the quality of its products.

"I don't feel we have much to apologize for," he said. "I'm empathetic, and I'm sorry that [some customers] had a bad experience. But I don't feel that the company is in a place where a blanket apology is necessary." LuLaRoe CEO Mark Stidham and DeAnne Stidham, his wife, who founded the company.Facebook/LuLaRoe LuLaRoe's internal audits have shown that the merchandise damage rates are "very, very small," he said.

"But no matter how small it is, if it's your piece of clothing and the bottom rips out of it, you are not going to be happy." He said LuLaRoe would "always look for ways to improve quality and style," but that it was not changing its manufacturing process in response to the complaints. The company has made changes, however, to its quality-assurance tests in the wake of the controversy. "We've added different stretch tests and visual inspections to find small holes," he said.

"We also invented a light-tower system where leggings can be stretched over it" to help detect any issues. How LuLaRoe works LuLaRoe has grown tremendously in the last several years. The number of people selling LuLaRoe products has jumped from 38,277 in September to 80,000 today, according to data obtained by Business Insider. Skye Gould The company expects to reach $1.8 billion in sales from April 2016 to the end of this month.

LuLaRoe has achieved this growth without selling any products in stores or even on a company website. Instead, the company sells clothing through its 80,000 independent retailers. The retailers — many of whom are millennial moms — buy the clothing at wholesale prices and then sell them at marked-up prices to friends and in online forums. The retailers can earn money from their direct sales and the sales of a team of recruits.

This strategy is called multilevel marketing — though Stidham says he prefers "multilevel management" — and it's also used by companies like Mary Kay, Beachbody, and The Pampered Chef. Some of LuLaRoe's top sellers say they make six-figure salaries. One retailer, Tiffany Cook, posted a lengthy video online last year saying she earned about $34,000 a month with LuLaRoe. In the video, she says friends of hers make monthly bonus checks of between $9,000 and $20,000 from the company.

Another retailer told Business Insider last year that she sold 800 to 1,000 pieces of LuLaRoe clothing — about $80,000 worth — out of her home each month. LuLaRoe's top sellers on a cruise in February.Instagram/LuLaRoe But most sellers aren't as successful. More than 80% of LuLaRoe's representatives generated less than $5,000 in sales last month, including 10,834 who sold nothing, according to data reviewed by Business Insider.

The average representative sold about $3,387 worth of LuLaRoe in the month. Stidham said the company didn't make any promises about how much money retailers could make selling its products. He said many retailers were content selling the clothes to friends and family for a little extra money, and that most didn't want to manage teams of sellers, which could generate more money. How to get a refund LuLaRoe's new policies include its Make Good program, which applies to purchases between January 1, 2016, and Monday, and its happiness policy, which applies to all future purchases.

The company also said it had sped up the process of refunding retailers who took back damaged items. In the past, retailers have complained that they couldn't get money back in a timely manner, but Stidham said that should no longer be the case. Retailers were informed of the changes on Tuesday. Here's a breakdown of each policy. The Make Good program: Applies only to purchases of defective merchandise made between January 1, 2016, and April 24, 2017.

Customers can apply for a replacement, gift card, or cash refund by contacting the retailer who sold them the product. If that retailer refuses to help them, they can contact LuLaRoe through its Make Good website, and the company will connect them with another retailer who can process their claim. Customers can also apply for a refund in the form of a personal check or a LuLaRoe gift card by making a claim directly to LuLaRoe on its website.

Claims must be made no later than July 31, 2017. The happiness policy: Applies to purchases made on or after April 25, 2017. Within 30 days of purchase, customers can return products for any reason to the retailer they purchased from to receive a full refund, credit, or exchange. Within 90 days of purchase, customers can return products for any reason to any retailer to receive a credit or exchange.

Customers can also apply for a refund in the form of a personal check or a LuLaRoe gift card by making a claim directly to LuLaRoe on its website. If a product has a manufacturing defect in materials or workmanship, customers may be entitled to a return at any time under the company's new limited warranty. The limited warranty applies to items purchased after April 24, 2017. Customers will not be charged for return shipping.

EXCLUSIVE FREE SLIDE DECK: The Future of Retail 2018 by the BI Intelligence Research Team.Get the Slide Deck Now » SEE ALSO: LuLaRoe is getting sued over claims that its popular leggings rip 'like wet toilet paper’ NOW WATCH: These are the $800 knives that celebrity chefs like Massimo Bottura swear by

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The company says it had a "technology system failure." Most Popular Feb 27, 2017 Original Story, 2/27/17 at 2:11 p.m.: It looks like LuLaRoe, the popular, colorful and comfy clothing line, has some explaining to do. Operated by what the brand calls "individual retailers," LuLaRoe is sold boutique-style during pop-up parties in women's homes. The clothes, especially the company's line of leggings, are known for their stretchy material and quirky patterns — and as of late, for their serious lack of quality.

Advertisement - Continue Reading Below More and more LuLaRoe customers are complaining about rips and tears in their leggings, some of which have appeared after just a few hours of wear. Women have taken to Facebook and other social media outlets to document the leggings' damage — images reveal large slashes or multiple tiny rips running through the fabric. "These pants rip like wet toilet paper," Valerie Williams, 35, of Syracuse, New York told Business Insider.

Of the five pairs she bought, two of them tore as soon as she put them on. Most Popular LuLaRoe spokeswoman Shana Frahm crunched the numbers, claiming that reported damages are only around 0.061% of shipped merchandise per month — a stat that's way below the industry average. But a scroll through LuLaRoe Defective/Ripped/Torn Leggings or Clothes Facebook page, which has 6,571 members (and counting), tells a different story.

The rips have become so pervasive that some sellers are now offering care guides for the leggings. The instructions include "Keep a separate LuLaRoe laundry basket" and "Treat your leggings like you would treat pantyhose." Which is, you know, the opposite of how you should have to treat your stretchy, comfy kick arounds — and women are calling the company out. Advertisement - Continue Reading Below "Any clothes that require that much TLC will not be welcome in most people's wardrobes," a Facebook commenter wrote.

Priced around $25 a pop, the leggings boast quite the price tag for a garment that may not last past lunchtime. Despite the company and their sellers' reassurance, some customers and consultants have yet to receive replacements or refunds. There's no way to return clothes through the company directly — only through sellers. If sellers, who pay for the clothing in bulk, wholesale, can refund your money, they have to wait for their own return on the damaged goods.

It's bad enough — but the company is also under fire for wrongfully taxing customers in states that don't levy one on clothing. And by "under fire" we mean facing a class-action federal lawsuit. "Defendant overcharges buyers up to 10.25% every time a consultant who lives in a jurisdiction that taxes clothing makes a sale where delivery is made to a jurisdiction that does not," said the suit, CBS News reported.

The plaintiff in the case is Rachael Webster, a Pennsylvania native, who was charged $35.16 for sales tax on a LuLaRoe purchase made in 2016. Pennsylvania, however, doesn't tax clothing sales. Webster's lawyer, however, thinks the wrongful taxation goes way beyond his client. "My suspicion is that there is a substantial percentage of consumers who make purchases from LaLaRoe through out-of-state 'consultants,'" R.

Bruce Carlson told CBS News. Looks like there are a lot more people entitled to compensation — and you might be one of them. There's some good news, though. Carlson told CBS that LuLaRoe has been receptive to the current charges. "Hopefully, they will take a similar approach regarding a broader universe in response to the litigation," he said. Until that time comes, customers have turned to other outlets to make LuLaRoe's inconsistencies known.

After more than 200 customer complaints were filed to the Better Business Bureau, citing sales tax and quality issues, the BBB gave the company an F rating. "On July 27, 2016 BBB notified the business of our concerns and requested their voluntary cooperation in eliminating the pattern of consumer complaints," the website reads. "As of today, the business has not responded to our request." [h/t CBS News and Business Insider] Update, 2/27/17 at 4:15 p.

m.: reached has reached out to LuLaRoe for comment and the company gave the following statement: "We stand behind the integrity and quality of our products, and take any concerns seriously. By and large, consumers love our products. We encourage our Independent Retailers to remind their customers that they can contact them to help facilitate an immediate exchange or full refund if they are unsatisfied with their product.

We are fully aware of this issue involving our former payments vendor, which had a technology system failure that misidentified the accurate location of certain individuals. We have invested significant funds and resources to develop an alternative point of sale system that corrects the issue. We have immediately reimbursed any individual whom we could identify as having been improperly charged sales tax.

We are proactively working to ensure that all affected individuals are refunded." For the latest coverage on LuLaRoe, click here. Watch Next: More from Good Housekeeping:

Hazel Gordon

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