Unilevel MLM Compensation Plan Review
Before you make a decision about any company or make an investment in any business opportunity you should always do yourself a favor and take the time to do some necessary research first. Before you decide that any specific opportunity is right for you, seek out third party information, facts, and resources that will show you exactly what it is required of you to become a success in this industry.
Once you have decided that you are going to invest your time, energy, and resources into building a business realize that if you better understand the dynamics of the plan you are looking first you will then be better prepared to choose the right opportunity to invest your lives in.
Consequently it should be clear to you that MLM Compensation Plans should be subjected to the same evaluation process that any MLM opportunity, its leadership, products, and marketing system go through before you decide a specific opportunity is right for you.
Pay plans are clearly an important part of each opportunity but is still only one facet of a complete opportunity. It becomes your responsibility to look at the whole package, including but not limited to: Compensation Plan, Product Line, Automated Tools and Strategy, Market Share, Leadership, Start-Up Costs, Mentoring, and your personal level of Skill and Preparation.
Are Unilevel MLM Compensation Plans proven and sound?
The Unilevel MLM Compensation Plan has been around for many years and has a solid proven track record in the industry. Governmental regulators in North America generally prefer the Unilevel MLM Compensation Plan to other plans.
Considered to be a true grandfather among MLM Plans over 70 percent of the companies started in the past decade are using Unilevel plans, and that percentage appears to be growing. The popularity and longevity of the Unilevel model may be undisputed, however, like all compensation plans there are both benefits and also drawbacks to be considered before choosing any Unilevel opportunity.
Are Unilevel MLM Compensation Plans a Pyramid Scheme?
The Unilevel Plan is not a Pyramid Scheme.
Pyramids are illegal recruiting games where people get money for enrolling people into the pyramid. There is rarely a legitimate product or service for sale. Participants also do not receive payment unless they successfully recruit a number of recruits into the pyramid.
MLM Compensation Plans are not set up to be a recruiting scam where people are only joining for the opportunity to make money off of signing up new members.
In MLM Plans there must be a legitimate product or service for distributors to market. The recruitment of new enrollees does not qualify as a product or service. Commissions are earned from the personal sales and team sales of products or services and there is a minimum amount of personal sales required to earn that commission. This and other safeguards protect both consumer and company from legality issues pertaining to legitimacy of MLM pay plans.
The basic concepts of Unilevel MLM Compensation Plans include:
- Unilevel MLM Compensation Plans are not a one level only plan as the name might suggest. The plan usually allows 3 to 9 levels of depth as well as allowing for unlimited first level sponsored width.
- Unilevel plans usually have varying payment rates for differing depth levels (common plans that we have reviewed pay commissions between 5 and 7 levels deep). and also include one or a number of special bonuses as compensation.
- Special Compensation features of the plan usually include: roll-ups, compression, and/or infinity bonuses (all of these terms refer to the process of product volume rolling to the next qualified distributor in the line when one distributor in the chain may not qualify to earn it.)
- Unilevel, as the name suggests, only allows you to sponsor one front line of distributors, therefore everyone you sponsor is on your frontline.
- Therefore, the common goal of this plan is to recruit a large number of frontline distributors and then encourage them to do the same.
Advantages of Unilevel MLM Compensation Plans
- Unilevel plans are relatively easy for companies to administer, and for distributors to explain to potential recruits.
- This compensation structure is more attractive to full-timers, and experienced network markers with the ability to recruit large numbers of distributors, and develop management and training systems for their growing downline.
- There is normally only a minimal amount of personal volume that is required to qualify for commission payments. Lower personal volume requirements than say for some other type plans makes it easier for most distributors to stay active.
- The Unilevel plan allows unlimited sponsoring on the first level. You can go as wide as you desire creating unlimited potential income.
- The Unilevel MLM Compensation Plan doesn’t create as much incentive for “inventory loading” or the stockpiling of product that other plans may.
Disadvantages of Unilevel MLM Compensation Plans
- The depth of levels they pay commissions on limits Unilevel plans. This restriction inhibits the creation of deep sales organizations.
- If you have a very strong builder/producer far down in your organization you may not see all the benefits and commission from them.
- As front line width grows and a sponsor’s attention is spent on recruiting, it may cause them to be “thin” in their support of newly enrolled distributors.
- When distributors are taught to go wide, it is easy to forget about the needs of their downline distributors, who are several generations removed. This can become a team management and organizational obstacle for many aspiring marketers.
- One of the main disadvantages of the plan is that every distributor you sponsor becomes crossline to all of your other frontline distributors and therefore must work in competition with the other members of your organization.
- An ever-increasing frontline requires continual training of new distributors and having to manage new distributor needs.
- Track records show that most companies that start with Unilevel plans eventually adapt them to look more like Stairstep Breakaway plans overtime. Be aware of the potential for this plan to evolve over time.
- Although it tends to be easier to earn commissions with a Unilevel Plan, you do not tend to earn as much as you would with other type plans. This trade off may or may not be suitable depending on the needs of the distributor.
- Full-time experienced “heavy-hitters” can become discouraged by how long it takes to reach the big money when using a Unilevel MLM Compensation Plan.
What you need to know about Unilevel MLM Compensation Plans to make them work?
When checking out a Uni-Level Program, be aware of the total amount paid out and where those payments are going in the compensation plan. There are different amounts being paid on different levels in different kinds of plans. If only small amounts are paid out on the first levels of a plan, and the real income is in the lower levels, are you the kind of marketer that this will work for? Do you stand a chance to recoup your monthly output if you are not yet capable of building depth?
Consequently if you find a plan that pays a lot up front in the first several levels but not at the deeper levels, does this suit your abilities, time, and style. Are you a part-timer looking for a few extra bucks or a full-timer looking to replace an income? Maybe you’re more ambitious still. What is your real chance of achieving your personal goals based on the kind of marketer you are, and the plan you are considering. Only you can decide if the plan you are considering will be a match for your personal needs.
Most plans pay between 35 and 45 percent of the company’s wholesale purchase volume, and about 30 percent of suggested retail volume. Look for a plan that divides the profits in your favor without going overboard. A plan that is overly “generous” to its distributors especially at the early levels in the pay plan can run itself into financial ruin. A balance that is healthy for both the company and the distributor is a necessary feature of any good plan that is going to last and provide a steady dependable long-term residual income.
The Unilevel Compensation Plan is in general best suited for those who have network marketing experience. It tends to favor those who are very confident in their ability to recruit a large number of frontline distributors. It also requires training systems and good management skills to assist and train your ever-widening front line of new distributors and create duplication in your teams.
Like most compensation structures this model does offer the potential to earn a very high income for those willing to acquire the knowledge, skills, tools, training, and systems necessary to succeed with a Unilevel Compensation Plan.
Aspects of Unilevel MLM pay plans that you may not be aware of:
Most modern network marketing companies using this model have made slight changes to the basic Unilevel Plan to increase its attractiveness to new distributors and to encourage and allow some partial teamwork. Most Modern Unilevel Plans also include a number of bonuses to sweeten the pot and make this older compensation plan more appealing to today’s modern MLM Industry.
In the past “Big Gun” recruiters couldn’t make money as fast as they could with other compensation plans, nor could they earn as much. This tended to give the Unilevel Plan a bad reputation that hurt their popularity. However, recent revisions, improved rules, and enhancements to the basic Unilevel structure, have eliminated these weaknesses and the popularity of the Unilevel MLM Compensation Plan has risen once again.
Unilevel plans now offer lucrative infinity bonuses and other forms of compression to bring the big money back into the plan. These bonuses have allowed top producers to draw income from deeper in the compensation plan than previously possible. Large payouts are being generated with Unilevel plans today, and it is considered by many to be among the most stable and lucrative pay plans in the industry.
How do Unilevel MLM Compensation Plans pay you?
Unilevel Pay Plans pay out a moderate amount, or a percentage of the total sales volume of the first several levels in a person’s organization. The first one or couple layers of the plan, pay anywhere from one to, ten percent on these levels. The rest of the remaining percentage (out of 100 percent) is spread out and paid in any number of ways throughout a number of levels. Usually seven to nine levels deep.
The Newest companies use what is called Unilevel Compressed Plans. If a company decides to pay $0.50 of every dollar earned to distributors, it will not stop at a fixed depth level. This means that if distributors, who are too deep in the plan for you to get payment on normally, do not qualify for a commission payment, then the remaining commission will flow up levels in the plan to the next qualified person and the complete $0.50 will be paid out. This is called “dynamic compression.” Commissions not earned by downline members roll up to distributor leaders instead of becoming profits by default to the company.
The Unilevel in recent years has offered several powerful incentives. Where dynamic compression is not present, you may find some kind of infinity bonus. This also helps distributors temporarily dip down to deeper levels in the plan to capture profits. Also, nearly every Unilevel plan now offers a front-end fast-start bonus that pays a special one-time bonus amount on the first orders of new customers and new distributors.
These bonuses and new plan features all help overcome many of the compensation plan complaints that one time discouraged distributors. It makes the plan fairer for those who work the hardest, and produce the most.
Will a Unilevel MLM Compensation Plan work for you?
Ultimately only you can decide that. Plans are like personalities not all are the perfect fit for everyone. The top percent of the distributors in any network marketing opportunity are able to produce incredible results. They are able to create stable teams, recruit like crazy, create duplication in their teams. They will shout from the mountain tops that network marketing is the greatest business opportunity they were ever introduced to!
Of the majority of less than successful folks, reviews will include a plethora of excuses usually blaming everyone but themselves and ranging from ‘I made a little money,” “it wasn’t for me,” to “it’s an outright scam and a pyramid scheme”. This seems to be true of the entire industry not just Unilevel Plan opportunities.
The real difference between those who win big and those who are less than inspired is in the tools and training they receive, and in the person they are willing to become to succeed. If you are not, willing to become trained and informed to succeed in this industry and are not ready to apply the knowledge and skills you learn on a daily basis… You probably aren’t ready for MLM Success yet. MLM probably shouldn’t be your first choice. Go get a job and work for someone else some more until you are ready.
Are you really ready to take your life, business, and income to the next level? Are you ready to become one of the 5% that are going to the top in this industry? These are questions you should have answers to before joining an opportunity or considering MLM, not after.