Essential oils have skyrocketed in popularity over the last few years, largely because of two popular multi-level marketing companies that promise a world of money and freedom if you sell their products: Young Living and DoTerra.
Whether you’ve been thinking about joining an essential oil company or you want to learn how to make your own oils and do it yourself, this post will go over everything you need to know to start an essential oil business without joining a pyramid scheme.
First, let’s go over two of the most popular essential oil companies and whether the opportunity is worth the hype.
(This post contains affiliate links. A girl’s gotta eat)
Young Living vs. DoTerra Essential Oils
Young Living and DoTerra are both multi-level marketing/network marketing/direct sales/MLM/pyramid scheme/whatever you want to call them companies. This means that when you sign up to become a distributor of their products, you get commission for every sale you make, and a smaller commission for the sales of every seller you recruit (your downline). The recruitment is when it goes from a regular sales business to a multi-level marketing company.
Both companies have a similar structure and commission level, and they’re actually much less strict than other MLMs. Here’s what to expect from each company:
Young Living Essential Oils
To become a Young Living distributor you have to purchase a starter kit, which costs $165 and includes your membership, an oil diffuser, and 12 oils. When you become a member you get 24% off the regular price of the product, so if you decide to sell to other people, your profit margin is 24%. If you recruit other people who become members, you get anywhere from 1-8% of their sales in commission depending on how far you are up the ladder. You can read their full compensation plan here.
According to the Young Living income disclosure, the average income for ALL ACTIVE MEMBERS in 2018 was $272. Two hundred and seventy two dollars. If you look at the charts for the average income of all ranking members, the numbers do look pretty attractive when you hit those higher ranks. But in order to reach Diamond level, for example, you have to have at least 100 orders a month and at least 5 people in your downline making $15,000 or more a month. No pressure!
DoTerra Essential Oils
To sell DoTerra essential oils, it doesn’t look like you have to buy a starter kit, but there are a few different options for signing up and becoming a member. When you become a member you get 25% off your orders, so that’s your profit margin. If you sign others up as members, you get anywhere from 2-7% of their sales depending on how high up you are in the pyramid. The DoTerra compensation plan is just as confusing as Young Living’s, but you can read it here to see the commission rates and tiers.
According to the DoTerra Income Disclosure statement for 2018, which has all the bad stuff in fine print and all the good stuff in pastel graphs, 62% of their sellers are what they consider “entry-level wellness advocates”. Fifty-three percent of that group made more than $0 in 2018. Those earnings averaged out to $380 for the year.
The next level of members is the “part-time entrepreneurs”, which make up less than a quarter of all members. This rank includes several levels on the compensation pyramid, but even the highest-paid rank in this group (which makes up 5% of all members) only made an average of $10,507 that year. All of that information is in the fine print of the income disclosure.
This last section is the only part of the income statement that’s highlighted in an eye-catching chart. This is the income of DoTerra Wellness Advocate Leaders, which make up less than 1% of all members:
Remember: that chart is the 6 tiers of Wellness Advocate Leaders, which make up less than 1% of the whole company. 62% of these leaders make an average of $28,205 a year. That’s a full-time sales job for fast-food wages, at best.
This is just one example of the many misleading tactics MLMs use to convince vulnerable people (mainly women) that this is a great money-making opportunity. Aside from shady tactics and bleak income statements, there are plenty of other reasons why you should avoid MLMs and network marketing opportunities like these:
- These companies have thousands of members who are representing the brand, and you have no control over what they say or do. If you’re trying to do things by the book and maintain a good brand image, it’s not going to do you any favors when the anti-vaxx mom who sells the same brand as you claims that a diffused combination of frankincense and orange oil cured her vegan son Braidyn’s ebola.
- You also have no control over the product price, the supplier, the brand image, the style… you’re given the responsibility of running your own business with none of the control.
- Even if you only plan to sign up for the discount on your own orders, your upline will pressure you to get more people to sign up so you can earn more commission. When your fellow members are showering you with toxic positivity and encouragement driven by dollar signs, it will be hard to not get yourself wrapped up in it and feel like you have to sell more products.
You can read my full explanation of why MLMs are a problematic business model that’s designed to fail at this post. As far as the essential oils, I found this aromatherapist’s opinion on Young Living and DoTerra to be pretty insightful, especially this part:
“Along those lines, doTERRA distinguishes their oils with CPTG Quality Testing (Certified Pure Therapeutic Grade®). This is a testing process that doTERRA created themselves, and no other brand of essential oils can use their trademarked certification label. Becaue of that, there’s nothing to compare it to, and it doesn’t really mean much. Yeah doTERRA has the only Certified Pure Therapeutic Grade® essential oils on the market—because no one else is allowed to use the term.”
That’s what I like to call deep-fried bullshit!
How to Start an Essential Oil Business Without Joining an MLM
If you want to sell essential oils online, there are better options that don’t involve selling your soul to a multi-level marketing company. Options where you can control your profit margins, your product quality, and your brand image.
You’re probably thinking you have to learn how to make essential oils in order to do this, but you actually don’t – although that is a great option if you’re willing to learn how to do it safely, and we’ll go over that as the last option. This list goes from the easiest/lowest investment to the hardest/biggest investment, so you can research each method and determine what is right for you. You can even start with one, then pivot your business to accommodate another selling method once you’re more experienced in the market. No matter what you choose, all of these options will teach you more than an MLM will.
Share Your Favorite Oils With Affiliate Marketing
Affiliate marketing is often confused with network marketing, and while there are similarities, affiliate marketing is a much more flexible way of making money with essential oils than the MLM method. With affiliate marketing, all you do is sign up for a brand’s affiliate (referral) program and share unique links with your blog readers, social media, friends and family. When someone buys through your link, you get a commission.
Millions of brands have affiliate programs, so you can sign up with brands you’re already using if they have a program, or promote multiple brands and products instead of what’s offered at one single company.
As an affiliate you have no upline or downline to report to, no starter kits or enrollment fees, no monthly quotas to meet, and no pressure from anyone to do anything – it’s a fully autonomous concept. Here’s my full guide to affiliate marketing for beginners if you’d like to learn more about the process and search for essential oil affiliate programs to join.
Private Label Essential Oils
Private labeling is a business model where you pay a company to make their product with your brand’s label on them, then you either buy the labeled product from them upfront, or in some cases, they ship the products to your customers themselves when you make a sale. It’s a common method that millions of brands use, and it’s a way for you to create your own online store without having to carry inventory or make the product yourself. This is a great way to get started to see if the business is right for you before learning how to make your own or investing thousands in wholesale inventory upfront.
If I were doing this method I’d open a Shopify store (get a free 90-day trial with my referral link!) and start working on my branding in Canva. I’d also be creating content to publish on a blog and social media such as recipes, uses for essential oils, my favorite scent combos, affiliate links to my favorite diffusers, etc.
Essential oil brands that offer private labeling services:
As with anything you sell, it’s important to do your research on each brand, where they source their ingredients, and anything else you’d want to know if you were a customer. Here’s a great guide from an aromatherapist on what to look for in a quality essential oil.
Buy and Resell Wholesale Essential Oils
Another option is to buy wholesale products and resell them in your own boutique. The difference between wholesale and private label is that you’d be buying another brand’s product rather than something branded as your own company. You could also do this with a Shopify store and sell a bunch of different brands rather than just one. Your company would be the boutique itself. You could even combine your own privately labeled brand and sell it along with wholesale items, but call yours the “signature collection”.
Wholesale usually requires a larger upfront order minimum than private label dropshipping, and you have to manage your own inventory and ship items yourself. You also need an EIN with your state to legally buy wholesale items, which is simple to do online through the IRS.
Buy Wholesale Essential Oils:
Make Your Own Essential Oils
If you don’t want to buy and resell another brand’s essential oils, you can always make your own. This is obviously the most challenging, especially if you’re not an aromatherapist or you’ve never made essential oils before, but it’s never a bad idea to take the time to learn a new skill or trade.
Since I don’t have the first clue how to make essential oils, here are some handy guides I’ve found that may be of use to you if you choose to go this route:
Aromahead Institute has an online course called “Introduction to Essential Oils” and it’s currently free to enroll. You’ll learn everything you need to know as a beginner from a professional aromatherapist, including:
- What essential oils are and where they come from
- How essential oils are extracted from the plant
- The language and terminology you’ll need to know
- Essential oil uses, safety protocols, and how to store and care for them
- How to dilute, diffuse, and make other products with your oils such as lip balm and soap
You’ll even get a certificate of completion and resources for career opportunities once you complete the course. If you’d like to become a Certified Aromatherapist, they have a paid course that’s more intensive but will officially certify you in aromatherapy. If you plan on doing any of the things on this list, it will probably help you significantly if you at least take the free course, especially since this is considered a health and wellness product. It’s safer for you, your business, and your customers if you are knowledgeable about every product you’re vouching for.
More essential oil educational opportunities:
Plant Therapy has a free course, so you could possibly learn from them and source some of your products from them.
Skillshare is an online course marketplace with dozens of essential oil-themed courses on everything from blending basics to more advanced aromatherapy.
All of these options vary in difficulty, investment, earning potential, and overall risk, but every option on this list allows you to make money with more autonomy than any MLM company ever will. Remember that you can always start off with something simple like joining a couple of affiliate programs (maybe even for products you already use) and write a blog post or social media roundup reviewing each one. Take some free courses, learn everything you can about the products and industry, then start your own private label or wholesale boutique if you’re ready to take the next step.
I hope this helps give you some clarity and helps you start an essential oil business the right way! If you try an idea on this list, tell me about it in the comments below.
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