Over the years there has been a drastic change in network marketing, thanks to the MLM software. Various MLM companies have ways of rewarding their customers and they came up with different compensation plans. The benefits provided to customers by a network marketing company are determined through an MLM compensation plan. There are different types of MLM compensation plans in the market, some of which provide custom plans for companies. Part of those compensation plans includes generation MLM Plan, donation MLM plan, binary MLM plan, monoline MLM plan, and forced matrix MLM plan just to mention a few.
If MLM companies are to manually calculate compensations, payout, and other bonuses, it will be difficult because there are various compensation plans. But with the help of MLM software, this won’t be a problem. In this post, we will be considering two of the most common multi-level marketing plans which are binary MLM software plan and forced matrix MLM plan.
Forced Matrix MLM Plan
Forced Matrix MLM plan is also known as matrix MLM plan or ladder plan is like a pyramid structure where each member is organized into a fixed number of columns and rows. For more clarity let’s say there are 4 main members and these members can recruit more members under them known as a downline. So when a new member is added to the downline there is a commission for each matrix plan member.
A forced matrix MLM plan is a compensation plan that encourages team growth and cooperation. Common matrix plans are 2×12, 3×9, 5x7and 4×7. So if your plan is 2×12 you can get two members at level one and the remaining member will spill to a later level with a depth of twelve levels.
Types of Forced Matrix MLM Compensation plan
Forced matrix bonus: it is an additional benefit for distributors and the bonus is only for members that fill their matrix with downline members. Let’s say you have a 3×3 matrix plan, you will need to recruit 3 members on the first downline, 9 in the second downline, and 27 members in the third downline.
Referral Bonus: MLM companies offer referral bonuses as a motivation for team members to recruit new members. Referral bonus is for team members that fill the first level of the matrix MLM plan. The bonuses for each company differ.
Position bonus: you earn a position bonus when your downline team members recruit new members and those new members join your matrix.
Level commission: you receive this commission when you recruit new distributors.
Matching bonus: is a bonus earned by sponsors based on the earnings of downline distributors they sponsored.
Advantages of Forced Matrix MLM Plan
Position compression: suppose a sponsor opt-out from the matrix tree then a position is vacant and that will affect bonus payout. With position compression, a downline member can fill the position and the position left by the downline member can be replaced with a recruited member.
Promotes cooperation: forced matrix MLM plan is a good plan that helps promote cooperation between team members and also increase sales.
Active business: every team member wants to keep their matrix tree growing so they always want to recruit new members. Making everyone active and keeps the business activities as well.
More rewards: the depth of the matrix MLM plan is more which means there will be more compensation, more opportunities, and more benefits.
Binary MLM Software plan
Binary MLM software Plan is very simple to understand and one of the common plans and is a two-legged system in the multi-level marketing compensation plan. Each recruited member is either on the right or the left subtree and they will also have to recruit two more legs each. Most start-up MLM companies prefer this plan because it has a simple plan structure.
If a member should recruit more than two members in a binary MLM plan, by default they go under the previous frontline member. Once you recruit two members you can start earning but there is a need to ensure that both the right and left legs are growing together. Because your compensation is based on the less active leg.
Advantages Of Binary MLM software plan
Infinite income: in a binary MLM plan there is no limit to how long you can grow your downline, which means there is no limit to your income as well.
Faster growth: since there is a distribution of work(recruiting new members) in this plan, it encourages faster growth. Also, just two members are expected from each member.
Simplicity: it is one of the simplest and easy-to-understand compensation plans, as you only need to recruit two members to begin.
Encourage teamwork: every team member needs to balance both legs, so working together to achieve this is not an option.