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subject: A Look at Multi-level Marketing Compensation Plans [print this page]

A Look at Multi-level Marketing Compensation Plans

Multi-level marketing businesses are popular primarily

because of their attractive compensation plans. There are

different ways a multi-level marketing pays their members.

Some pays them outright. Others pay bi-monthly and still

others cash out all the member's benefits on a monthly

basis. Actually, it really doesn't matter how seldom or how

frequent a company pays their members. What's more important

is that they pay on right on time at all.

The attractive compensation plans of multi-level marketing

companies come from different streams. The first, and

usually the most important stream is the downline stream. A

lot of MLM's pay their members for every recruit that they

generate. This is especially true if the MLM business

requires for some sort of registration fee, setup fee, or

sign up fee from the new members. For example, if new

members need to pay $10 to join the program, their direct

referrer will earn anywhere from $1 to $5 as per agreed

upon. This means that the more people you recruit, the more

commissions you get.

Another income stream would be through your direct sales.

Most MLM opportunities revolve around the promotion of a

certain service or product. And so whenever you successfully

closed a sale out of your own sheer marketing efforts, then

you will be paid a certain percentage of the total sales you

managed to post. If you were able to send a total sales

amount of $120 for the whole month of April and the MLM

company pays you 30% of your sale, then you'll have $36 more

in your next payout. This is paid to you on top of the

commissions you gained from your recruits.

MLM companies also pay you for the activities of your

downlines. If all of your downlines managed to make an

aggregate sale amounting to $100 and the multi-level

marketing compensation plan says that you are entitled of

10% commission for that, then you should have $10 out of

their marketing efforts. This is a good compensation plan

because this is what can give you residual income. For as

long as your downlines are active and are doing their part,

you should be able to collect income from the MLM company

regardless if you work or not. Some programs even allow to

downline sales commissions up to 3 levels deep.

These are the three major income streams of an online multi

-level marketing business. There may be others still. The

other compensation plans are usually implemented on a

certain company alone and not across all MLM's. This is

actually where MLM's become different. Other MLM

opportunities would pay you just for the three basic income

streams stated above. But there are others that would think

of other creative ways to pay you so you'll be more enticed

in joining their program.

One creative way to earn is through the mere promotion of

the splash page. Although there are only a few MLM companies

that actually pay a few dollars per thousands of

impressions, this is still a convenient way to earn through

this stream. If you stumble across an MLM company that pays

you as you promote the main site, then you are actually paid

for promoting your affiliate link, which directly benefits

you as well.

MLM companies are getting more and more competitive these

days as far as compensation plans are concerned. It is upon

you to actually choose the one that would maximize your

earning potential.

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