MLM Compensations Plans Don't Have To Be Confusing

One of the most discussed...and confusing..aspects of an MLM business is the whole compensation (pay) plans "thing". To many it can be so overwhelming....to the point of causing massive headaches just to contemplate. While with others the potential emotions involved can cause rather heated "sharing" of opinions. Whatever your thoughts and experiences EVERYONE can benefit from a solid understanding of the ins and outs of Compensations Plans.

To help give everyone a solid foundation....I've found an excellent article at the MLMIA website (Multi-Level Marketing International Association) by Doris Wood. This primer is the most comprehensive and detailed coverage of the subject of compensation plans...with examples of how they function....I've ever seen.

The article is pretty long (as you may expect with all the great info it contains)...but here's a tidbit to get you started:


UNDERSTANDING THE MLM COMPENSATION PLANS
Copyright 1995 - 2003
By Doris Wood

This article concentrates on the types of plans used by most Multi-Level companies. Except, of course, for those who use a hybrid or a mixture of several plans. Although both Direct Sales and Multi Level use similar programs, they would put their emphasis on different areas.

There are basically five types of compensation plans used in Multi-Lever (Network) Marketing, with many variations of each. There is probably no one plan that is perfect or right for everyone at every time. What may be the best plan for you today could change due to regulations, your experience in the industry and/or the type of product, even new technology. And, it's those variations that can make the difference. Most successful company review their compensation plans on a yearly basis with a competent consultant to make minor changes as needed so they do not have to make major changes and disrupt and sometimes loose their sales force.

Let's take a look at the 5 different types of plans in their most basis forms without the "toots and whistles." They are...

Stair Step Break A Way
Uni Level
Matrix
Australian
Binary

To read the entire article go to UNDERSTANDING THE MLM COMPENSATION PLANS.


Doris Wood is the co-founder of MLMIA, which was formed in 1985 along with Michael Sheffield. If you are interested in reading their bio information, click HERE.