Product Type: MLM
Scam or Not: Not a Scam
Overall Rating: 5/10
What is CAbi?
CAbi stands for Carol Anderson by Design (hence the strange capitalization) and is a direct selling company that focuses on selling clothing. This choice of products is very unusual for direct sales but despite that, the company itself actually does fairly well and has carved out a place for itself in the direct selling industry.
Like other similar companies, CAbi promotes itself as a way of making money, through selling the products and recruiting others. While that approach should sound extremely familiar, there are some unusual things about CAbi that make it a little bit unusual as a way to make money.
In this CAbi review, we’re going to take a look at what CAbi offers and whether the company is a good choice for making money.
Essentially, CAbi focuses on selling fashion. Primarily, their products are clothes but there are also a few accessories and some jewelry in the mix. As with most clothing companies, their products vary with season and in this case, they release two collections per year.
In terms of price, the clothing from CAbi is somewhere in the middle of the range. So, this isn’t the cheapest clothing that you will buy, not by a long shot. Nevertheless, it is less expensive than many high quality stores.
Based on this, your audience is likely to be people who don’t mind paying around $100 for a single piece of clothing. Certainly, there are many people who fall into this category but there are also many who couldn’t afford to buy this type of clothing.
Because of this, it’s worth closely considering whether or not your potential customers would be interested in these clothes and able to afford them.
As for the clothing itself, what you think will depend on your personal style preferences. I imagine that some people find their clothing appealing, while others may be less impressed.
Some reviewers note that the clothing has the advantage of being fairly versatile, working for a range of age groups and body shapes, along with many different styles and types of outfits.
The company does also appear to put a lot of thought into the clothing and there is a clear focus on fashion and the way that different pieces look and feel. To me, that is encouraging and it suggests a strong focus on consumers.
However, there are limitations too. For example, the clothes certainly aren’t designed for people who are outside the ‘norm’. So, there are no tall sizes, no petites and no plus sizes. At the same time, there are relatively few basic items.
Those patterns are partly connected to the fact that the collections are fairly limited. For example, this is the grand total of all the pieces in their current collection:
At max, this means that there are around 96 pieces. That’s a pretty small range when most of your potential customers would be used to the selection that stores have to offer. Additionally, some categories are extremely limited, like the fact that there is just one dress on offer:
Because most of the information about these products is online, it’s a little difficult to get an accurate idea of their quality.
Most reviewers that I’ve found say that the clothing quality is similar to what you would expect in higher end clothing stores. So, essentially, the quality is roughly what you would normally get for the price.
That’s a fairly good outcome and suggests that some people would be likely to buy the clothing.
Selling Clothing through Direct Marketing
CAbi’s product selection is incredibly unusual for the direct sales industry. Most of the time, you find direct sales companies focusing on items like jewelry or health and beauty products, because these are popular and don’t rely on people trying them first.
In contrast, clothing is a considerably more challenging choice.
One of the biggest issues is that people generally expect to try on clothing and see what it looks like on them. The direct marketing structure doesn’t support that approach at all. At the same time, fashion is an incredibly competitive field and there are so many places where people can buy clothing in every style and price range imaginable.
Yet, despite these limitations, CAbi actually does fairly well. A key reason for this is the emphasis that the company has.
When it comes to buying clothes, people often don’t know what suits them best or what type of style to shop for. In a physical store, there is the potential to get help from staff members. But, even then the amount of personalized assistance that customers get is normally fairly low.
CAbi’s approach seems to be an attempt to cash in on the demand for education about fashion and personalized advice.
To do this, the company focuses on training its representatives well and teaching them a lot about fashion and how to give good fashion advice. This includes information such as how to create outfits, better approaches to clothing and what clothing options are best for different body types.
At the same time, CAbi also has an emphasis on only hiring people who are passionate about clothing and the company.
The end result is that CAbi has a smaller number of representatives than most other direct marketing companies. However, those people also have considerably more training and skill than you would normally expect.
This allows them to provide high quality advice, which people can’t find in many other places.
The overall approach has clearly done wonders for the company and CAbi is one of the few direct selling companies that has managed to sell clothing successfully.
The success of the company does mean that it’s unlikely to disappear any time soon, especially as it is fairly unique. Despite this, the success of the company isn’t reason enough to get involved.
Instead, the key question is whether you can make money through it and that’s precisely what we’re looking at in this CAbi review.
CAbi Compensation Plan
CAbi is a MLM, which means that it uses a tiered structure for compensation.
The first part of Cabi’s compensation plan is simple – you earn money for sales. With this company, you earn a base 25% commission for the sales that you make, which is fairly decent.
However, if you’re reading this CAbi review because you’re serious about making money, then you can’t just stop at selling the products. Instead, you have to get into the other side of the company, the recruitment side.
For CAbi, the compensation plan appears to be relatively simple. Essentially, the bonuses that you earn are tied into the size of your team, providing that the monthly minimums for sales are met. Those minimums are as follows:
Essentially, this means that you need to sell at least $2,500 of product per month ($3,500 after your first season) to reach the higher level of commissions. Likewise, if your team has a high amount of sales ($24,000 + per month), then get additional bonuses. Visually, it looks like this:
The basic pattern is the same as other MLMs, so the more team members you have, the greater your potential income.
The most encouraging thing about the plan is that it is simple. As far as I can tell, there is no system of ranks within the company and no mention of additional bonuses or managing different legs of your team.
Instead, all that seems to matter is the level of your team members (level 1, level 2 etc.) and the amount of sales. This is incredibly refreshing compared to most other MLMs.
The compensation plan also means that there is less focus on recruitment than normal. You do still get income from your team members along with a team builder bonus, so there is much more money involved in recruiting. However, in other MLMs, it seems to almost impossible to make money without recruitment, while that isn’t really the case here.
Benefits and Advantages
Most of the time, MLMs are fairly similar to one another, especially in terms of their models and what is expected of distributors. CAbi is an exception to this rule in a number of different ways. Some of those differences are major advantages.
Being a CAbi Stylist
With just about any other MLM, selling products is exceptionally difficult because there is a huge amount of other similar products out there. For example, health and beauty MLMs tend to sell supplements and things like protein shakes. Certainly, there is no shortage of any of those products in the market.
At the same time, there is little to suggest that the products from the MLM are better. In most cases, MLMs simply end up selling more expensive versions of products that are common already.
This is true for CAbi too, as there is no shortage of competition in the fashion industry.
Yet, CAbi representatives aren’t just selling a product, they’re also offering a stylist service. That pattern is a key reason why the company is successful and it gives customers a reason to buy from CAbi, rather than from anywhere else.
Overall, this is certainly an advantage and it may be one reason why CAbi is fairly successful at selling clothes, while other direct marketing companies fail at doing so.
Another advantage of the company is the compensation level. This varies considerably from one MLM to another but CAbi starts off fairly high, at 25% to 33% commission.
Getting 25% commission on sales at the lowest level is appealing and this is higher than many other companies. This would also add up, as the products from the company are on the expensive side.
In theory, this means that it would be faster to make money with CAbi than most other MLMs. Nevertheless, it isn’t as simple as all that. For one thing, more expensive products let people earn more per sale but, at the same time, making sales tends to be a bit harder because of this.
In terms of compensation, I do like the fact that the overall plan is simple. If nothing else, this lets people focus more on selling products than on recruitment and that’s always a good thing.
Issues with CAbi
There may be a number of advantages with CAbi but the unusual nature of the company also produces some key disadvantages.
The Cost of Selling CAbi
Getting involved in a MLM is often expensive, especially as you typically have to buy an introduction kit and also purchase products yourself. However, CAbi takes this to a whole new level.
In particular, stylists for the company have to spend more than $2,500 per season on inventory. That’s a huge investment.
As the company points out, if you sell all of those items (or even most of them) you would make a decent profit. In fact, even if you sold some of them at a discount, you still would.
However, that’s still a large amount of product to sell.
Plus, buying product ahead of time is a risky approach in any company (Paparazzi Jewelry does something similar). After all, you’re putting a considerable amount of money down and you can’t be certain that your customers are going to want the specific items that you choose to buy.
This issue is particularly relevant for clothing, as people come in all shapes and sizes, in addition to their varying perspectives on what clothing they like. Realistically, I imagine you would always be left with some stock. You might be able to clear that at a discount but doing so would cut into your profits.
Take the image above for example.
The company says that if you sell 70% of your inventory at a 50% discount, you’d make more than $3,000. From their wording, this income seems to be what you earn, rather than profit.
So, you make upwards of $3,000 from those sales but the inventory cost you $2,570 plus taxes and shipping. All in all, this means that you’re making barely any profit.
Now, of course, if you sell more product or if you sell some at full price, then you could potentially make a decent profit. However, it is certainly easy to see how this could backfire and leave you barely making anything.
As I mentioned before, this is a seasonal cost. The company puts out two seasonal collections, one for fall/winter and the other for spring/summer.
So, you have to make that investment twice each year.
In theory, you should be able to buy the second set of stock from your profits from the first season. However, this does involve careful business management, which is something to be aware of.
Inventory and Clothing
The general idea with CAbi is that the $2,500+ worth of clothing you buy at the start of the season acts as a sample. So, these are clothing items that people can try on and figure out what they think.
However, customers don’t buy these items directly.
Instead, clothing is order from the company in the size that the customer is interested in. In theory, this means that you don’t have to keep stock of every single item or size in the catalog. Nevertheless, the underlying idea is that the more stock you have, the more sales you will make.
At the end of a season, members then turn around and sell their samples at a discount.
It’s hard to know how well this works in practice. Potentially, the approach could work quite well and it’s a good way around some of the issues connected to direct sales and clothing.
Nevertheless, I imagine that it could be difficult to actually sell off that inventory at the end of the season, even at a discount. After all, most people who wanted clothing would have already purchased it.
Alternatively, you might find that people hold off buying clothes from the company so they can buy discounted samples at the end of the season – which is far from ideal.
Overall, the inventory idea could work well and it’s certainly better than having to buy stock and then sell it. Despite this, it’s easy see where issues could arise.
Restrictions and Sales Quotas
Another interesting thing that I found when looking into this CAbi review was that the company has more rules and restrictions that you might expect.
In most cases, MLMs like this tend to be fairly lax about who can be a distributor and it’s often hard to actually get ‘fired’. Instead, MLMs tend to focus on making it difficult to get into the upper ranks or to stay active (and hence, be able to earn money).
However, CAbi is different.
With CAbi, there is also a sales quota. If you don’t meet that quota for one season, then you simply can’t sell in the next season, period. This approach helps to make sure that the company only keeps members who are truly passionate and dedicated to the company and to clothing.
One outcome of this approach is that CAbi has a higher success rate and lower level of turnover than most other MLMs. For example, one article suggested that the retention rate is around 85%, versus around 20-30% for many other MLMs.
That retention rate might sound great but it happens because most of the people who get involved with CAbi know the risks and are prepared to make the investment. In most cases, if you make an investment of more than $2,500 in a business, you’ve probably done your homework and are dedicated.
The end result is that CAbi has more restrictions than other MLMs and you have to make a considerable amount of sales to even stay in the game. If you can’t, it isn’t worth even considering the company.
How to Become a CAbi Consultant
Becoming a CAbi consultant is fairly simple. The website for the company offers a basic form that you can fill in.
The form is designed to put potential members in contact with a distributor, who will then step them through the joining process. Hopefully, that distributor also explains the challenges with the program and the various requirements.
Making Money with CAbi
In some ways, CAbi is better than most direct marketing companies out there. The stylist approach certainly makes a lot of sense and it’s easy to see how this could help members to make more sales and to get people interested. The relatively low number of distributors is also an advantage, as it means less competition and the compensation is nice too.
Nevertheless, the company is also harder than most other MLMs and requires considerably more investment.
So, can you make money?
As with every MLM that I’ve looked into, the simple answer to this question is ‘yes, but…’.
In theory, the MLM model works. Without a doubt, it really is possible to make money. Likewise, there is the potential to make a lot of money if you have a decent customer base and you can grow your team.
But, doing so is much harder than you might think.
Let me make one thing clear. Making sales is difficult, especially in a direct sales environment. Even salespeople find this challenging.
Think about how much the difficulty would increase with you selling products from your own home, especially as most people won’t even recognize the brand. What about trying to sell more than $2,500 worth of stock in a given season? Would this even be realistic with your social connections?
And, that’s just the sales side of things.
Recruitment is that much harder again.
Realistically, most people that you know won’t have the time or the energy to try and make money from CAbi. That’s true for any MLM and CAbi has significantly higher startup costs and involves more risk that pretty much any company out there.
Now, you might be able to recruit a person or two into the company but getting a large and successful team seems like an extremely unrealistic goal.
Whether or not you can make money with CAbi ends up depending mostly on your own situation. If you had enough social connections, including a range of potential customers who like spending money on clothing, then CAbi may make sense.
However, for most people, getting enough sales would be almost impossible, especially as you have to make a decent amount of sales each season to be able to sell products the next.
My Personal CAbi Review
Over the course of this CAbi review, I’ve found that there is no clear-cut answer about this company and its oppounity. On the one hand, it has more income potential than many other MLMs and it’s easy to see how people could be successful. Yet, the company also involves a lot more risk and investment.
While the company may appeal to some people, the end result is that CAbi would be unsuitable for most who consider it.
When it comes to making money, a better alternative is a business that puts you in control and doesn’t require a large amount of investment. With this type of business, you have the ability to grow it over time and you lose much less if you aren’t successful.
Of all the approaches out there, one of the most realistic and powerful ones is affiliate marketing. This is fairly easy to learn and get involved in – plus, you don’t have any physical stock or direct sales to deal with.
There are many different ways to get started with affiliate marketing but the one that I recommend is a training site called Wealthy Affiliate. This powerful training site was designed with beginners in mind and it is the perfect place to learn the field and to develop your own successful online business.
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