Compensation Plans, Pro’s & Cons
What I have done here is made a list of some of the most popular Compensation Plans and then given some of the advantages as well as the disadvantages of each one. You can also do an extensive search on Google for the specific Compensation Plan that you are looking for if it is not listed here. If you are not comfortable with that you can always contact me and I will do the research for you…free! So, look these over and educate yourself.
Stair Step Break Away
One advantage to the Stair Step plan is that you can go very wide and you don’t have to place your members. Some disadvantages are ending up with a heavy hitter under someone who doesn’t sponsor and of course…THE BREAK AWAY, which means that you will only get paid a certain amount of Money up to a specific level and you lose volume, sometimes completely.
Matrix (fixed width and fixed depth, ex. 2×10 or 5×12 ect. ect.)
An advantage could be that if you got placed on a super sponsor monsters front-line you could get spillover and get your organization built for you. A disadvantage would be that this is “welfare minded” behavior and you could most likely end up with a “dud” on your front-line who expects you to build his business. So, in summary reserve your front-line positions for your business builders if you want to maximize this compensation plan.
Aussie 2-up (your first 2 personally sponsored people go to your sponsor)
I can’t really think of any advantages to this plan! Except maybe if you are a sponsor monster yourself you would get the first 2 personally sponsored of all your members! Now we come to the disadvantages… This plan is actually based on recruiting, there is NO residual income and it’s really just a one time sale. What happens to your income when you stop recruiting, or your members stop recruiting?? Did you know that it is against the law to make money from recruiting? You are only supposed to be able to make money from product sales!
Binary Plan (2 legs)
An advantage to this plan is that you may just luck up and get a runaway leg. It pays on volume and there are no levels which means that it goes all the way down. Some disadvantages are that it only pays you on the weaker leg. The leg that you personally build. This plan drives the behavior of “fear of loss” They will advertise..”Get in Now!!” Please don’t fall for this and remember that if it’s a good opportunity it will still be there and you’ll still be able to get in once you have done your homework and research.
Uni-level Plan (you can sponsor wide and down)
This type compensation plan does very well for those who are in direct sales. You also get a higher percentage rate on your first levels. A disadvantage would be the “breakage” which is usually hidden in the plan, more than likely in the cost of the product.
I will be adding and up-dating this information as it comes in and more is discovered. Thank you for your interest and remember…Your time and money are valuable, invest wisely. Do your homework!
This free Ebook “Success in 10 Steps” is a great place to start!
Have an awesome day!
Tina Gregory
tina@eagleslog.com
