Pampered Chef started in 1980 and is based in Addison Illinois. They have been selling their range of housewares and kitchen products for over 40 years through home parties run by an international network of consultants. In 2002 Pampered Chef was purchased by Berkshire Hathaway and is now part of their family of companies.

Pampered Chef consultants are not employees, they are contractors selling through a Multi Level Marketing system. Here at The Finance Guy, we think you can’t make money with MLM, but we’ll give them the opportunity to prove us wrong in this review of Pampered Chef. We want to know if this is a real money making opportunity, or just another MLM money trap.

What Is The Pampered Chef Opportunity

To find out more about this ‘side hustle’, we looked at the official Pampered Chef Opportunity page. The first thing they tell us, is that this gig is all about Friendship, Freedom, and Fun. There’s also ‘flexible income’, and ‘fantastic rewards’.

All you need to do get started is follow the 3 simple steps:

Step 1 - Sign Up
Right away, they’ll give you the tools to run your business. This is in the form of a link to their website, with a referral link.. Your ‘personalised website’, will cost you $120 per year.

To demonstrate how valuable this is, we thought we’d let you try it on our site, just add whatever you want after the .net (in web address format)…. https://www.finance-guy.net/add-whatever-you-want

Step 2 - Choose A Starter Pack
Like all MLMs, the joining fee is negligible, but then they encourage you to purchase a starter pack. It’s important to remember that this purchase is not compulsory.

You can spend anywhere from US$60 to US$230 on a starter kit. The important thing to remember is that your upline earns commission on your starter purchase.

Your sponsor might tell you stories about the importance of buying inventory based on some variation of ‘having faith in yourself’, or ‘being a product of the product’… Real deal is, that the person who sponsored you earns commission from your starter purchase

They tell us that the price you pay is well below market value… this raises an interesting question as to what is market value? In our Tupperware review, we discovered that you can buy better quality goods in regular stores at lower prices…. maybe before you spend money, you should check the quality of Pampered Chef products.

Step 3 - Start The Party
You can hold parties either in person or online! It’s just like being able to sell to friends or on Amazon, so there’s anyone can do it.

According to Pampered Chef, signing up will help you ‘inspire confidence and creativity in the kitchen”. Just gonna put it out there, but similar results can probably be achieved with your current kitchen utensils and ideas from Google.

They tell us that you join Pampered Chef, you will get a work life balance and get ‘fantastic rewards’. All these vague promises are typical of most MLMs. They allude that this is a money making opportunity but there isn’t much detail.

How Do You Make Money With Pampered Chef

To find out how you make money as a consultant, we looked at the Pampered Chef Compensation plan. This document explains all the ways you can earn commission and what you need to do to qualify for it.

We’ll go through it and see what you can earn at each rank in the Pampered Chef Egyptian Triangular structure.

Consultant
All you need to do to reach the rank of ‘consultant’ with Pampered Chef, is sign up. Right away you’ll be able to sell their products for commission, and recruit others to the opportunity.

Director
It seems unusual, but the first promotion you get will be to the rank of ‘director’. While this sounds like it should be near the top of the scheme, it’s not. It could be for another reason or because they are trying to make Pampered Chef Consultants seem more successful than they really are.

To make it to this rank, you’ll need to sponsor 5 active Pampered Chef consultants. Together you’ll all need to buy enough product and then you can earn 3% commission on what your recruits buy.

Advanced Director
If one of your recruits makes it to the rank of ‘director’, then you will become an ‘Advanced Director’, with Pampered Chef. Once again you and your team will need to purchase enough product for you to reach this rank.

As an advanced director, you can now earn 4% commission on your sales, and from your ‘first generation’ of recruits. You can also earn 3% from the people they recruit (your second generation).

Senior Director
To get to this level, you need 3 first generation directors (people you sponsor), and 1 second generation director (someone sponsored by your downline).

In addition to all the advanced director commissions, as a Senior Director, you can also earn 1% from your second generation. This means you earn money when people 3 levels below you in the system spend money on Pampered Chef.

Executive Director
To reach this level, you need to have 6 1st generation directors and 2 2nd generation directors. Once again everyone needs to spend enough money for you to qualify.

Once you hit this promotion, you will be able to earn 0.5% from your third generation in Pampered Chef.

Senior Executive Director
To reach this level, you will need 9 1st, 5 2nd and 1 3rd generation director. At this point you will continue to earn even more commission from those below you Pampered Chef.

National Executive Director
This is the top rank in Pampered Chef. To get here, you’ll need 12 1st, 9 2nd and 3 3rd generation directors below you. At this level, you will have unlocked all the commissions and bonuses available through Pampered Chef.

The ongoing theme from the Pampered Chef opportunity, is that to climb to the top, you need to recruit, and you have to ensure that the people you recruit, also recruit.

What Do Pampered Chef Consultants Do

While the compensation plan basically told us that you can unlock 6 levels of commission with Pampered Chef, it didn’t really tell us much about the company or what we’d actually be doing.

To find out more we looked at a copy of the Pampered Chef Consultants Guide. The first thing we notice here, is that they encourage virtual parties as well as in person parties. This is probably an advantage in these times of social distancing. They even offer some hints and tips about how to post on Facebook in ways to avoid looking like spam….

The simplest way to explain a Pampered Chef party, is that it’s a cooking demonstration. In person, you can obviously include tastings… over Facebook, it would be like putting on your own cooking show.

It looks like Pampered Chef has borrowed from the Tupperware model, in that the idea is to find other people to ‘host’ parties. The idea being that they invite a bunch of friends and then the consultant puts on a demonstration and sells them products.

Like Tupperware, we assume that if you host a Pampered Chef party (either at home, or on Facebook), then the consultant will try and recruit you into Pampered Chef. Part of the instructions for a party is to talk to the host about the ‘benefits of being a consultant’.

There’s nothing wrong with following a successful business model, but we already found that you can’t make money with Tupperware. At the end of the day the company might be doing well, but that doesn’t mean the consultants are turning a profit.

Are Pampered Chef Consultants Making Money

We looked at Pampered Chef with Dr Jon Tayolors 5 Step MLM evaluation, and we found that it raised several flags. According to Dr Taylor, if any MLM raises more than 4 flags then your chances of turning a profit are less then 1 in 1,000, let’s take a closer look:

Red Flag 1 - Constant Recruitment of New Members
You can not climb the ranks of Pampered Chef unless you aggressively recruit. It doesn’t end there, you need the people below you to also recruit. Recruiting every host to become a consultant is part of the Pampered Chef manual

Red Flag 2 - Promotion Through Recruit
In order to climb the Pampered Chef ranks, you need to build a dowline. Your advancement in the Pampered Chef ranks depends upon you recruiting enough new consultants to qualify for each rank.

Red Flag 3 - Pay to Play
Remember climbing the ranks in Pampered Chef is all about having ‘active consultants’ in your downline. Being ‘active’ in any MLM means spending a minimum monthly amount on their products. They might tell you that it’s all part of the formula for success (being a product of the product, investing in yourself) etc, but really it’s just charging you money to be in the opporutnity.

Red Flag 4 - Most of the Rewards go to your upline
When you first sign up to be a Pampered Chef consultant, the only way to make money is from commission on your own sales. Once you start building a downline, you can earn more and more commission.

While it might be fun to earn all those different commissions, it’s also important to remember they are included in the price you pay to Pampered Chef. So every time you buy from Pampered Chef, several people above you in the system earn commission from you.

Red Flag 5 - More than 5 Levels in the Payout Plan
While their compensation plan is simple, we were able to see that Pampered Chef pays on up to 3 generations in your downline. Then they pay other ‘directors bonuses’ on additional level. It would appear that the payouts do exceed 5 levels.

Why Is It Difficult To Make Money With Pampered Chef

The problem is not unique to Pampered Chef. We think that it’s unlikely to make money with any network marketing opportunity. While the companies that make the products may be very profitable, less than 1% of the people who join any MLM will turn a profit.

The reason is that they are not offering you the chance to be a business owner. They are asking you to be their customer. At best you might be a commission based salesperson. Anyone who tells you that MLM isn’t about selling, is lying. To share the opportunity is to sell it.

Is Pampered Chef An Illegal Pyramid Scheme

Even though MLMs closely resemble pyramid schemes, they are not illegal. The reason dates back to the 1979 case of Amway vs the FTC. After 4 years in court Amway was found to be offering a business opportunity, rather than a pyramid scam. The technicalities came down to wording in their paperwork. One example requires consultants to make retail sales.

The Amway ruling effectively opened the doors for all other MLMs to operate within the law. However we should remember that being legal doesn’t make it ethical. If you knew that less than 1% of people had a chance of generating a real income, would you feel comfortable recruiting new consultants?

Another issue, is that even though these rules may be in the paperwork, they are difficult to enforce. For example, several people in MLMs have said that they have cupboards full of product. This is because of the minimum monthly purchases they need to make to remain active in the system. Even though stockpiling is against the rules, there is no way for the company to monitor it.

If you are thinking about joining Pampered Chef, we advise that you consider all your options before making final decision. If you have the skills to turn a profit in MLM, it’s more than likely that you can make even more money in a regular sales job.

We’d love to hear what you think in the comments section, especially if you can share your experiences with Pampered Chef

Are you wondering if you can make money in an MLM? Check our our list of mlm reviews before you join. If you find one that’s not on the list, let us know and we’ll do our best to write a review