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Lularoe sellers filing for Chapter 7 bankruptcy

Some Connecticut readers may be familiar with the online retailer Lularoe. The company offers women's apparel and accessories, sold through local merchants running a home-based business. The company enjoyed substantial success in recent years, but it appears that some female Lularoe merchants are struggling to ply their wares.

At least 24 recent bankruptcy cases featured Lularoe as the business entity. In many instances, women achieved healthy sales for one or more years only to find those numbers drop off precipitously in recent months. It may be that the initial success of the company led more and more people to sign up as retailers, saturating the market. Of course, many different factors go into an individual's decision to file for bankruptcy, so it is not clear to what degree a Lularoe business factored into a bankruptcy filing. 

Lularoe retailers are required to invest their own money to build inventory that is then sold locally. Many women use savings to purchase their inventory, while others turn to credit cards to finance this business investment. For those who encountered sluggish sales, they may also be facing high levels of debt and a substantial amount of unsold clothing.

Starting a new business is always risky. While some Connecticut home-based businesses thrive, others are closed within a relatively short period of time. Having a solid business plan can make a big difference in one's chances of success, but there are always outside influences that can tank even the best business plans. Fortunately, financial tools including Chapter 7 bankruptcy are always an option, and can help individuals regain financial stability after an unsuccessful business venture.

Source:, "At Least 24 Women Who Sold Lularoe Who Have Filed For Bankruptcy Since 2016", Stephanie McNeal, Nov. 6, 2017

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