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A BRIEF
LOOK AT 4 MLM COMPENSATION PLANS
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>> If
you are thinking about joining a network marketing
company, also referred to as multi-level marketing, or
MLM, one important item you will want to understand is
its compensation plan. Otherwise, “How will I get paid?”
There are four basic kinds of MLM compensation plans
that will be described in this article.. Each of these
may have several variations. Some plans are better
suited for the people who really enjoy sales and may
desire to retail a lot of products. Some plans are
designed to attract especially the “heavy hitter.” Some
plans pay well for the beginner and may or may not be
attractive to the big recruiter. Some plans make a
serious effort to reward even the little guy or gal who
can only sponsor or recruit a few people, but also pay
very well to the top distributors.
These plans are called Unilevel, Stairstep Breakaway,
Binary, and Matrix.
1. UNILEVEL. This is a simple, straightforward
compensation plan. It allows for a distributor to have a
first level of unlimited width. The levels the company
pays commission on generally range from 3 to 9 levels
deep. The more volume generated by you and your
organization, the more you can earn. A disadvantage to
this plan is that building wide means the distributor
may give less help to his personal enrollees.
2. STAIRSTEP BREAKAWAY. This is the most common of all
the compensation plans. It is where most of the really
big money is made in MLM. This big money, however, is
made by a very small percentage of people. Breakaway
plans are geared for full-time effort. Attrition is the
highest with breakaway plans and it generally will cost
more to build your business. This is a work program. It
takes persistence, salesmanship, and requires the
ability for you to train your recruits. Companies which
use breakaway plans tend to pay higher commissions.
However, the plan may be extremely difficult for most
people to duplicate.
3. BINARY. This is a very complicated and
hard-to-understand plan. It does, however, offer a
simple system that is easy to duplicate. Otherwise, you
recruit just two and help them do the same.
4. MATRIX. This plan allows you to build a limited width
organization. For example, a 2 X 12 group means two
people on your first level, and paying 12 levels deep.
Other examples would be a 4 X 5, 3 X 9, etc. This is
generally pretty simple and easy to understand and
explain. The low volume requirements usually common to
matrix plans helps make it a good plan for part-time
distributors.
The above briefing only scratches the surface of these
compensation plans. For a more detailed description, you
may wish to go to: www.mlminsider.com
Even though some of the internet hype may claim that you
can make big bucks with only a little work, don’t
believe it! With network marketing, as in any other
business, you’re going to have to work at it and make
some investments if you expect to be successful. To make
money in MLM, you will have to work, no matter what
company or compensation plan you select! << |
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