This is Part 3 in a series of five articles[1,2,3,4,5].

Here are the nuts and bolts of one of today’s most powerful and successful MLM compensation plans–the Hybrid Uni-level. It’s important for MLM companies AND distributors to understand their compensation plan because it is the vehicle of success for both.

Note: It has become increasingly clear to me that it’s just as important for network marketing distributors to understand MLM compensation concepts as the MLM companies, themselves. Why? Because distributors invest their all into building a downline. The bottom line is if distributors understand MLM commissions, they can make better choices about the companies in which to invest their lives!

Most of the plans that are called Uni-levels today are actually Hybrid Uni-levels. In other words, the Uni-level Plan is typically the backbone and then other commissions like fast starts and/or pool bonuses are added to increase earnings. So, this plan features a level commission as the primary commission. A level commission pays the distributor a percentage on a certain number of levels of his/her downline. Some of the common additions to the level commission to create a Hybrid Uni-level include:

• When a distributor signs up a new recruit, he/she is paid a fast start commission for certain products, product packs, or a specific amount of product the new distributor initially sells. The purpose of the fast start is to get higher sales commissions to the upline on the first few sales as well as to newcomers to the program. A distributor can earn fast start commissions each time he/she recruits someone for as long as he/she is in the company, but they’re only paid for the first few months or on a certain amount of a recruit’s sales volume.
• “Mini-barrier” plans that have everyone sign up as a preferred consumer and then automatically advance to distributor when he/she qualifies.
• A small differential or single level commission on the front of the plan. Typically, this is done by overlapping infinity commissions at the intermediate ranks. A differential commission maximizes commissions for those who are doing what the compensation plan is designed to reward. It targets a specific activity.

Read full article from Mark Rawlins at MLM.com here.

This entry was posted on Wednesday, May 26th, 2010 at 12:22 pm and is filed under Articles, mlm. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.