MLM Compensation Plans: Part 3 - I Saved the Best For Last!

First off I want to offer my sincerest apology for not getting this out to you as scheduled yesterday. But life happens and to make up for this happening, I will be offering you a FREE audio with an in depth training about Compensation plans. Moving right along to the business at hand.

I know you are going to love what I am about to share with you. How do I know this?
Because it's what YOU need for a successful business. What I am about to share with you will totally blow you away, that is if you are ready to accept it as truth.

I know that their are some that will not accept what they are about to get here.
But it is my hope that somewhere in their mind, they will remember this article.
If that is the case, they will remember me and they will return here.

Now before I get to the information that I have for you, If this is your first time to this blog then you should CLICK HERE and read ==> Part One and Part Two now.

What I will be talking about is The Stair Step Breakaway compensation plan.
The most important point I want to make is this, in a stair step break away you don't let your downline out build you! This is the oldest pay plan known to man, and in order for a pay plan to be legal you MUST be able to out build your sponsor. Are YOU understanding the reasoning behind this? If your company compensation plan does not allow you to be able to do this, and if a company is letting this happen then it's obvious that the company management do not understand compensation plans.

I want to illustrate how a stair step breakaway plan works.
Let's say it takes $500 to join your company, and your company pays $400 fast start money (this is what you call the front end money) it goes to the upline. Let's say that this person really gets busy and sponsors 10 people in that week. $400 times 10 equals $4,000 for the week. That's a very good pay day for the week . My question to you is, can any of those people he sponsored in do what they did? Not likely because people are not alike.

You may get a few people that sponsor 1,2, or maybe 3. Here's a fact worth noting, the average person will sponsor 2.5 people. So the odds are against them on doing what the super recruiter did. Not everybody can do it.

Understanding the Stair Step break away plan is very easy, and once you get it. You'll know why it's rarely used and only a few people will be successful with it.

Remember that $400 commission the company pays to the person at the top of the pay plan.

Let's say YOU get to:
Stair step 1 you will make $100 and your upline gets $300
Stair step 2 you will make $200 and your upline gets $200
Stair step 3 you will make $300 and your upline gets $100
Stair step 4 you will make $400 and now that you have reached your upline volume you break away from them.

You just stair step jumped over your upline.

At the beginning I stated that you don't let your downline out build you in a stair step break away because you will not get paid once they break away from YOU. Many people won't like this pay plan because you have to constantly keep sponsoring people, YOU will never be able to retire and have residual income.

Now I hope that you learned a lot from this article, and I am making available to you a FREE audio with additional information about compensation plans. I recommend that you listen to it your earliest convenience so that you will be successful in having a residual income that will pay you and your children, and their children for years to come. Build it once and build it BIG! The ONLY WAY TO DO THAT IS TO GET EDUCATED ABOUT COMPENSATION PLANS!

Download Your FREE audio training on Compensation Plans

MLM Compensation Plans: Part 2 - An Explanation Of The Binary Compensation Plan!

I'm back with more information about compensation plans. First let me just say this, if you missed the first part of my post. YOU should definitely click here and read it now.

What I will be talking about today is, Binary compensation plans.

What is a binary? It's a pay plan that has two legs. All YOU need is to get two people to join you and get paid the bonus money. The thing is, in 2 to 3 years this type of plan will need some tweaking. If the company does not do this, then it starts to pay out to much money. If you're in a binary, the company will have to fix this, YOU GOT TO REALIZE THIS. Otherwise the company will not last.

What I'm seeing a lot of, is the so called check match, that is often associated with this type of plan. When the companies tell you, that they will pay you 50% on everyone you sponsor in. Where does the money come from? It has to come from some where. It comes from your strong leg, you don't get paid on your strong leg, it's the weak leg you get paid on.

Here's an example of what I'm talking about:
Say you got 2,000 in volume on one leg, and then you have 1,500 in volume on your other leg. You will only get paid on the leg with 1,500 in volume (this is your weak leg).
Now let's just say that you sponsor someone in and they really get busy and start sponsoring people in and now the leg with 1,500 in volume increases to 3,000 in volume and the other leg is still at 2,000, now you will only be paid on the leg with 2,000 in volume (this is now your weak leg). You see how this works, this is called breakage, and who do you think pockets the money from that 3,000 in volume that was generated. The company does, that the breakage.

Now I know what you're probably wondering, what's the best pay plan? I will put it this way, any pay plan that pays the most amount of money on average volume. Pretty simple, huh!

It makes perfect sense doesn't it. When you've got a pay plan that does this, your retention will increase. Your distributors won't quit, and YOU will build a huge residual income.

Now on tomorrow, I will be talking about the stair step break away compensation plan. I invite you to come back here and learn about it.
Before I go, I want to share with you a very powerful FREE resource that will benefit you greatly in finding the right business.
Click here ==> MLM training resource guide.