2 Multi-Level Marketing Payment Structures

As of 2017, people all over the United States are becoming affiliated with the Multi-level marketing industry. As an entrepreneur, when you get involved in that industry, you get to sell products or services to the masses. If you are fortunate enough to see success, you can put yourself in position to see large returns.

In my opinion, most people get involved in that type of industry and fail to educate themselves on the payment plan structures that are offered by the opportunities. Today I will share with you two different payment plan structures to help assist you.

However, let me educate you on what that industry is all about. Multi-level marketing, abbreviated as MLM, can also be referred as network marketing and pyramid selling. This type of industry has developed a controversial reputation. Most people who join this type of industry fail because they are not educated on proper marketing techniques.

A common practice in the MLM industry is selling products and services to family and friends. They usually call it the “warm market” strategy and it is highly ineffective, in my opinion.

However, if you see success, here are two possible payment plan structures that your opportunity may use to pay you.

#1 Matrix

In this plan, there is a specific and predetermined width and depth. For instance, one MLM company can have a 4-by-5 matrix, which permits a distributor to sponsor five people directly on their front-line. In addition, they earn revenue from the sales of those people up to six levels.

This plan is in place to encourage distributors and new recruits to work as a team. Sometimes, when a distributor’s front-line is full, the opportunity will upgrade that distributor from seller to teacher. They do this to make sure that you are focused on helping out the people who are at lower levels.

#2 Breakaway

The breakaway plan is also known as the stair-step breakaway plan. It earn the name from the idea that a salesperson, after climbing their way through each level of the company, can reach the point where they can “break away” from their up-line. The up-line is the person who introduced you to the opportunity.

The benefit of this payment plan structure is that it motivates the distributors to work hard and eventually break away to create their own organization. Opportunities that offer this type of payment plan structure usually aim for full-time business builders.

Unfortunately, in my opinion, this plan can discourage distributors to work as a team because most people will only be concerned with building their own organizations.