Scentsy layoffs, compensation plan & product changes
Scentsy has announced a round of staff layoffs. The layoffs coincide with compensation plan changes, effectively raising the barrier of entry to its MLM opportunity.
On January 9th Scentsy filed a WARN notice in Texas. The notice details 94 layoffs in Coppell on January 3rd, 2025 (click to enlarge):
Coppell is home to one of Scentsy’s two US product distribution centers (below is from Scentsy’s website):
It’s unclear how many employees work at the Coppell center.
Following on from the Coppell layoffs, on January 19th CEO and President Dan Orchard announced Scentsy compensation and product changes (hat tip to Julie Anderson).
Scentsy is unifying branding of its “pod” products as Scentsy Air. The company is also discontinuing three of its product lines:
The big change in Scentsy’s compensation plan is the increase in required Personal Retail Volume” (PRV), from 200 to 250 a month. The change also effects Scentsy affiliates qualifying through “party” marketing events.
Scentsy affiliates are required to meet the monthly PRV target to fully qualify for MLM commissions.
The Monthly Sales Award Bonus increases Scentsy commission rates. Its qualification criteria has been increased from 2000 to 2500 PRV a month.
Orchard (right) attributes Scentsy’s compensation changes to needing to “build momentum”.
Recently we’ve seen a decline in momentum, really across just about every direct selling company.
New customer acquisition, customer engagement, new consultant acquisition and new consultant engagement; Given that this is currently not happening at a level that can sustain us today, we know that we need to make some changes.
One positive for Scentsy Consultants is those who don’t meet 250 PRV a month will still earn 20% on personal volume. Previously affiliates who failed to meet PRV requirements once over a rolling four-month period were deemed “inactive”.
I believe affiliates who don’t meet 250 PRV over a rolling four-month period still need to hit 250 PRV at least once every 12 months to avoid account cancellation.
The MLM commission requirement of hitting required PRV (now 250 PRV) over a rolling four-month period remains unchanged.
Previously Scentsy had a “Certified Consultant” rank, requiring 1000 PRV with no time limit and permanently qualifying a Consultant at the 25% commission rate. This rank has been dropped in favor of the monthly PRV requirement.
Of note is Orchard disclosing that as of late 2024, only 25% of Scenty’s Consultants were active (i.e. qualified for MLM commissions).
Increasing monthly PRV requirements will either encourage Consultants to meet the new quota, as Scentsy is hoping, or result in even less Consultants qualifying.
Either is a win for Scentsy as a company. They either drive more sales or earn more on orders they don’t have to pay MLM commissions on (whatever the percentage difference 25% of Consultants failing to qualify but placing an order increases to).
I can’t speak as to whether Scentsy’s plan will work but it does feel like trying to draw more from existing Consultants over expanding the business.
Scentsy’s announced compensation plan changes begin March 1st.
Scentsy is owned by Orville and Heidi Thompson (right).
The Thompsons took a break from Scentsy back in mid 2021 to pursue a “three-year mission” with the Mormon church in the UK.
Dan Orchard was initially appointed interim CEO but that position appears to have been made permanent.
The Thompsons’ “mission” ended mid 2024. As I understand it though they’ve been MIA regarding Scentsy since returning to the US.
Your article is wrong. Currently requirements are $200 to be active but you still get 25% even it’s just $50.
The new structure states you have to sell $250 to be active but anything under $250 your commission is reduced to 20% and $250+ will be 25%. So it’s a cut in pay for 75% because currently 75% do not even meet the $200 requirement.
The active part is only to continue to be a consultant and you have to active only one month out of every 12 months.
As well, they’ve moved it to April 1st because per the current contract they’re required to give 60 days notice and March 1st doesn’t meet that requirement. Hence the April 1st date change.
The 25% was only kept if you hit Certified Consultant, which is going away. Thanks for repeating what was already correctly stated in the article.
It’s not a win-win because they pay commission either way, active or not but so many get reduced commission that it will effect 75% of them. Many are leaving in droves so they’ll never make up for their losses by reducing commission by 5%.
Those at the top need a minimum of $500 to paid at their title and they haven’t changed that, that’s required for anyone with a downline to get paid at whatever title they hold plus other requirements. Why did that increase?
No, the article states they’re lucky because they won’t have to pay commission on those who don’t make active. This below in the article is inaccurate. Everyone gets paid commission no matter how much they sell.
Inactive Consultants don’t get paid MLM commissions. I remember there was a slide shown and, under the current plan, 75% of Consultants or thereabout aren’t active?
So either Scentsy is paying 20% instead of 25% or cutting out even more Consultants from MLM commissions. How is that not financially win-win for them?
Yes they do, as one I can guarantee that everyone gets paid no matter their sales. It was 25% but now it you do not hit $250 you only get 20%. Those are the facts and what you saw in Dan’s was such a bad presentation it wasn’t funny. No matter what you sell, $50, $100, $100 you get 25% right now, April first you’ll get 20% under $250 and 25% above $250. Those are just the facts.
I’d be happy to show you one of my checks when I only sold like $65 and still made 25%.
Either I’m not following or you are failing to understand what MLM commissions means. Getting paid 20% or 25% on your own personal volume isn’t MLM commissions.
Cutting commission on the 75% that make less than $200 is causing many to leave in droves. They won’t be able to make that up with those staying by just reducing the commission by 5% on those who don’t even comprise a small portion of their revenue.
Those consultants make up a huge percentage of consultants who are paid little to nothing while those at the top won’t have a change and make anywhere from $15,000 a month to $66,000+ a month. It’s not a win at all.
You get paid two ways to make it simple, on your own sales you get a commission then you get paid on what your downline does if you even have one.
1) you sell $100 right now you get 25% back, sell $200 you get 25% back and are active. You must be active one month in each of 12 months, that’s all the active part means.
April 1st, if you don’t sell $250 your commission goes down to 20%, so that $100 sales you now only get 20%, and in order to get the 25% currently offered no matter what you sell, you must sell $250.
It’s really quite simple. Either way you get paid commission and 75% are not even selling $200 per his video now, making it $250 when they can’t even hit $200 is making consultants leave like crazy.
What does that do, those at top lose income and the company will lose profits because those that stay and lose 5% how long will they last.
2) if you have a downline, you get paid on your own sales as indicated above, however you also get paid on those below you. Most sell around $2,000 ish to get the extra 5% but now they’ll need $2,500 however that’s the bulk of the commission paid out, it’s what they get off their downlines.
Most would get paid less than $1,000 based on their own sales but actually get anywhere from $15,000 to $66,000+ but it’s only about 1% or less of consultants.
Does that help clear it up?
Right but if you’re not active, you don’t earn MLM commissions (???). Doesn’t matter what the MLM commission rate is if you outright don’t qualify for it.
You’re not thinking like a late-stage capitalist executive silly. How are you going to get your parachute if there’s nothing in the company accounts?
Clearly Scentsy’s owners stopped giving a crap a while ago. They’ve been on holiday for three and a half years.
Get those company accounts as full as you can and cash out. Whatever happens after is someone else’s problem.
You ABSOLUTELY GET COMMISSION NO MATTER HOW MUCH YOU SELL!!!! EVERYONE GETS PAID!!
They left and put scapegoats in place.
Commissions != MLM commissions. There is a difference.
OMG, let me try this again.
CURRENTLY
YOU SELL $150 THIS MONTH
NEXT MONTH YIOU GET A CHECK FOR $37.50
April 1st
YOU SELL $150 THIS MONTH
NEXT MONTH YOUR CHECK WILL BE $30
I’ll bet that’ll save them
Yeah I’m just going to give up trying to explain at this point.
Perhaps Scentsy should have transitioned to an affiliate model if getting paid on their own volume is all anyone cares about.
I know the rules inside and out and how the pay works. So there’s that.
As of April 1, 2025 (USA):
A Scentsy consultant must earn (sell or buy) 250 prv order at least once every 12 months to remain CURRENT (to remain a consultant).
To be considered ACTIVE, a consultant must earn (sell or buy) 250 prv monthly. PRV is generally $1 per point, less other discounts, and a few exceptions.
All consultants receive at least 20% commission on their earned prv. Consultants who’ve earned 1,000 prv, use to earn an extra 5% commission on any size order, but now only do during months in which they earn 250 prv (ACTIVE months).
Consultants with downline (that have recruited & have a team of consultants under them), make more in commissions.
Just clarifying that all consultants earn MLM commissions on their earned prv. If 75% of Scentsy consultants were inactive in December, it just means 75% didn’t earn 200 prv in December.
That 75% is the average consultant, Scentsy’s best customers, and not dead weight.
Attacking this group by taking away commission promises, will be a LOSE-LOSE for the company (less sales & less commissions).
Getting paid on your personal volume isn’t MLM commissions.
See #11.
It is my understanding from the announcement that if you don’t make the 250PRV in the time specified, they are simply cancelling you. Meaning you are no longer a consultant, period.
This I find extremely harsh, especially for those who have invested thousands already and won’t be able to do anything with their stock. Huge blow to those individuals.