Understanding The MLM Compensation Plan

One of the most important aspects of Multilevel Marketing is the Compensation Plan. Unfortunately, most of the distributors fail to understand the various compensation plans being utilized in the network marketing industry.

In multilevel marketing, distributors earn their income called commissions and bonus through the compensation plan based on their ability and performance. The commission is the amount that is earned by the distributors when he sells the product in the market purchased from the company.

While Bonus is the amount paid on downline sales. In general, there is two type of bonus.

It is highly recommended to select MLM compensation plan after taking into account many fact and figures. The factors which need to be considered are:

Product Type: Closely evaluate the type of product for which compensation plans need to be used. Binary or Matrix plan can be used for virtually any type of product range.

Experience: The level of experience a company possesses in the industry. Binary, Stairway compensation or board plan can be used by the company who is 1 day old as these are very easy to operate.

Country: As far as MLM is considered one also need to take the country into account. Some compensation plans are banned in some location. So carefully select the country in which you want to operate or expand.

Altogether there are different compensation plans likewise:

• Binary Plan
• Matrix Plan
• Generation Plan
• Board Plan
• Differential Plan
• Unilevel Plan

Just keep in mind the above points while choosing the perfect compensation plan that would provide attractive commission and lucrative bonus.