Independent unsalaried salespeople of multi-level marketing referred to as associate distributor, represent the parent company and are rewarded a commission relative to the volume of product sold through recommendation. Additionally, distributors can also earn a profit by retailing products which they purchased from the parent company at wholesale price. Everyone can get good compensation based on the type of compensation plan as described below.
This type of plan is often considered the simplest of compensation plans. Uni-Level plans pay commissions primarily based on the number of levels a recipient is from the original representative who is purchasing the product. Commissions are not based on title or rank achieved. By qualifying with a minimum sales requirement, representatives earn unlimited commissions on a limited number of levels of downline recruited representatives.
This type of plan is similar to a Uni-Level plan, except there is a also limited number of representatives who can be placed on the first level. Recruits beyond the maximum number of first level positions allowed are automatically placed in other downline positions. When all positions in a representative's downline matrix are filled, a new matrix may be started. Like Uni-Level plans, representatives in a matrix earn unlimited commissions on limited levels of volume.
Binary plan is a multilevel marketing compensation plan which allows distributors to have only two front-line distributors. If a distributor sponsors more than two distributors, the excess are placed at levels below the sponsoring distributor's front-line. This "spillover" is one of the most attractive features to new distributors since they need only sponsor two distributors to participate in the compensation plan.
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