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The MLM Binary Compensation Plan
The binary! First lets talk about what the MLM Binary commission plan is, where it can be used and who it tends to appeal to before we get into the MLM Binary being good or bad, or all the myths associated with it.
First, a description of an MLM binary. Binary means 2. An MLM binary compensation plan has two legs. It is like a 2 legged MLM matrix, but it has unlimited depth and typically pays from infinity.
MLM Binary's often pay weekly, but it Japan it is common for them to play bi-monthly, monthly, or 4 times per month as well
The old VS. the New
Old MLM binary compensation plans used to have a point cap on a weekly basis, which in turn limited the amount that could be earned from a single business center. For example 5000 points on the left and 5000 points on the right for earning $1000. Very often MLM binaries run on about a 10% payout on the number of points. In the above example total points are 10,000 and the payout would be $1000. This was very typical of Old MLM binaries used by companies like Usana, Market America, N/A/T/O/ International etc.
As you earned points in these MLM binary compensation plans, you would need to balance your points on the left and right by way of steps. For example, you got 1000 points on the left and 1000 points on the right this would be considered a step, and you would get $200. You would also usually have a cap on the number of points you could earn on one side in a week. Often around 5000. Any points you earned in excess of 5000 would flow up line. They would not be stored in any way. Every week was like starting over. This wasn't ideal.
These MLM binaries gave the whole MLM binary commission structure a bit of a bad name after an initial surge of popularity.
The new MLM binaries eliminated a few of these negatives.
First, they offered cycling which meant you could earn a whole cycle more than once a week. They then capped a center at a considerable weekly sum of money, often over $20,000 a week. This was certainly better than the $1000 a week limit of the older MLM binaries.
The next thing a lot of the newer MLM binaries did was eliminate the need to have 50 - 50 balance in your points to be paid. The most common was to allow 1/3 - 2/3 split of volume. This allowed for a distributor to have a stronger leg and not be penalized for it as much. A much better version of the MLM binary compensation plan. It was used by such companies as Skybiz, TeamGlobe.com, Enliven, and World Games Inc.
This updated version of the binary has proven to be one of the fastest growing compensation plans out there, but has not yet proved itself to be a plan of longevity. The longest i know of so far is www.worldgamesinc.com who made it to their 4th year using this type of an MLM binary plan, though they did add matching bonuses to thier plan which could be the magic modification to longevity. Sadly that company died for issues not at all related to their MLM Compensation plan.
I welcome comments from anyone on new or old MLM binaries and how long they have been around or cool features they have used to attract your attention. Also would love to know how big your teams are in these companies you inform me about.
Internetnextstep.com Consulting Ltd. is an industry leader in MLM Software and MLM Binary Compensation Plan design and has designed will over 50 MLM binary compensation plans for our many MLM Software clients. We sadly have seen almost 80% of client provided new style MLM Binary plans simulate to pay way over 50% and often over 100%. Fortunately for our MLM software clients we were able to help them avoid disaster.
Please be very careful that your MLM Software provider, or MLM Compensation Plan designer or MLM Consultant is competent in MLM Binary design. More often than not your Top MLM Leaders will come up with an MLM Binary commission plan that will bankrupt you in months should they bring you a large team.
Next we will get into the Pros, Cons and all things wonderful and horrible about the MLM binary compensation plan!
INS can certainly help to design an MLM Binary compensation plan should you need help with yours. We have a generous Share in the risk plan on MLM commission plan design available to all our MLM Software clients.
Contact us today to learn more about INS MLM Software or our other MLM related services or request pricing by Clicking Here.
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