Network Marketing – MLM Compensation Plans

Network marketing
MLM compensation plans


Compensation plans in network marketing / MLM vary from one company to the next. They are at best difficult to understand for both you and the person introducing them to you.

It is up to you to ask questions when evaluating any company’s pay plan. Some are front end loaded or they maybe back end loaded.

There are some plans out there that payout more
then 100% fortunately these companies don’t last long but
do end up hurting individuals and give the network marketing industry
as a whole a bad name.


As a general rule of thumb anytime
you see a payout of more then 60% be suspect. It generally indicates

    • The products are grossly overpriced, unless it is a unique
      product or a exclusive patented product.


    • Qualification/Quotas most well established companies will
      have some volume or monthly quota that each individual representative
      must maintain.


  • Breakage/Break away several of the most popular programs
    out there use this one. Imagine after all your hard work you
    miss your quota for the month only to have all your hard work
    building an organization disappear.


Most compensation plans fall into binary, breakaway,
matrix, stair-step or uni-level plan but there are other plans out
there as well.

Network Marketing Binary Plan:

First level is limited to two with infinite depth.

Network Marketing Breakaway Plan:

Unlimited first level width, usually with a finite depth 10 to ?
levels deep.

Network Marketing Matrix Plan:

First level width 2 to 7 usually 5 to 50 levels deep.

Network Marketing Unilevel Plan:

Unlimited first-level width with a depth of usually 5 to 10 levels.

Learn Why People Fail In Network Marketing
And What You Can Do To Prevent It!