Transcript for What You Might Not Know About the Business of Mary Kay
It's an army some 600,000 strong in the U.S. Alone. Their favorite vehicle, pink cadillacs, of course. It's Mary Kay cosmetics and its legion of sellers and buyers. But some saying their experience wasn't all pretty in pink. Here's Rebecca Jarvis. Are you ready for the most exiting night of your life? Reporter: Musical performances, sashes and crowns, and an amped-up audience that can't seem to get enough. This scene has all the glamor and glory of the miss America pageant. But this is no beauty contest. It is a celebration of sales. Welcome to awards night at "Seminar," the annual convention of the iconic cosmetics and skin care company Mary Kay. We're a global company in over 35 markets worldwide. And we sell our products through a direct sales business model. Reporter: Direct sales. That means Mary Kay doesn't sell its products in stores or online, but through independent beauty consultants like Kelly Johnsrud, who sell to friends, family, and anyone they meet. Our Mary Kay eyeliner, like, once it's on, it's really on. Just blend it in. Reporter: Skin care classes like this. Women sitting around a dining room table are the foundation of the company's $4 billion sales empire. That is your shade. Reporter: The cosmetics colossus was founded 53 years ago by Mary Kay ash, recognized as a titan of American entrepreneurship. And Mary Kay products from lip gloss to eyeliner have been recognized for their quality. A lot of you are already, like, in love with some of these products. And that's how I feel, too. Reporter: The company's website promotes the chance to sign up as "A great part-time One. Wishl think, right? But ere is O step you catake to HP prevenanother serioudisease. Eu Pncoccal pumonia. 50 older, Prnar 13®accine can he protectou from pneucoccal pumonia, an illss that N cause cougng, chespain, difficty breatng, anmay event you in the hpital. 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A woman who was at a party two weeks ago stopped me and said, "I want to talk to you about the promotion Mary Kay is doing in September." So, potentially signing up to do the business. Reporter: Plus, once 24 people sign up, you're on your way to one of these. Pink cadillacs. Custom designed just for Mary Kay. Each of these three success stories drives one. It's obviously the most famous trophy on wheels and it's a lot of fun. It's like a representation of the American dream on the road. And I think a lot of people know that. Reporter: That's just one of the awards consultants can earn. This one is for my own personal sales, the queen's court of sharing. Reporter: And at seminar there's even a throne! And you may not think you would like that, Rebecca, but let me tell you when you're on the stage and there is an adoring audience cheering for you, you get into it. Reporter: Unlike other businesses, a Mary Kay consultancy doesn't cost much to launch. Just a hundred bucks for a starter kit. You know, one of the things that was most important to Mary Kay was that she create a low-cost way for a woman to own her own business and be her own boss. Reporter: Mary Kay's buy back policy offers 90% refunds for all inventory purchased within the last 12 months. If I didn't love it and if I couldn't find my way of doing it then I had a little bit of a safety net. Reporter: Today Mary Kay claims a worldwide sales force of 3.5 million. And it's easy to find women who rave about the company. What's harder is to get answers to the kind of question you hear all the time on "Shark tank." What's your profit on that? Reporter: What did you make, in your very best year? You know what? I would have to look. Reporter: You don't know? Because we have the freedom and flexibility to ramp it up when we want to ramp it up, and ramp it down when we want to ramp it down. I would have to look actually. Reporter: Do you know, lyris? Yes, it was well over $100,000. What was it after expenses? It was still extremely profitable. Reporter: What did you make last year with Mary Kay? I would have to look. I am not to six figures yet. If I don't know my exact Numbers, it's because I'm really focusing on what my day is like. Reporter: As for Mary Kay corporate, in its magazine "Applause," the company tout choice or a lucrative full oppo rtunity if you choose." Kelly grew up as a Mary Kay kid. My mom started her business when I was 7 years old. Reporter: This is the only career she's known. But fellowyan Rives and lyris Patterson worked corporate jobs joining Mary Kay. In part because of the flexibility it offers working moms. We're going to make a product delivery, it's to one of my great friends. Reporter: With Mary Kay you ly start there, with the friends, the family, the relatives. And sometimes that can be a little awkward. Working with family and friends can be comfortable, if you are upfront and have great communication and expectations going Reporter: The company's founder provided some guidance for her sales force.
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