May 15, 2008
Types of Multi Level Marketing Compensation plans
In MLM network marketing or any type various compensation plans are used by the parent companies. One of the methods is the Stairstep Breakaway plan. In this type of plan you have representatives that are responsible for both personal sales as well as collective or groups sales. Each group has a group leader and he can be provided with various rebates or discounts.
A specific standard is set relating to volume of transactions and once the desired level is reached the representative or group leader moves a step up the ladder. The process would continue till the representative breaks and gets away from the up line and from then they will no longer be the part of the up line’s group.
Another method with mlm leads is the simplest yet effective Uni-level plan. They pay commissions basing on the number of levels that a recipient is away from the representative who is physically buying the product. Representatives get qualified with a minimum level of performance and this entitles them to earn unlimited commissions despite limited levels down line.
Matrix plan is also alike the Uni-level plan but the number of representatives that can be in the first level, are limited. These plans have both width and depth. When all the available positions in the matrix are fulfilled a new level could be started.
The last among the mlm business compensation plans is the binary plan where there are two front line distributors only. Distributors have to balance the two down line legs to get commissions.
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