MLM compensation plans are the ones that determines the benefits that a network marketing company provides to its customers. Binary compensation plan is what that allows us to add only two people under the sponsor’s downline. And the Matrix compensation plan is a little different from this.
Understanding In Depth About Binary MLM Plan & Forced Matrix MLM Plan
Binary MLM Compensation Plan
The major role of a compensation plan is to deliver a portion (which can differ according to the network marketing company you work for) of the profit or sales made to its distributors or executives.
There are multiple compensation plans in existence and it includes Binary, Matrix, Unilevel, Board Plan, Hybrid MLM Plan and many more.
Calculation of payouts or other bonuses to its members become more complex as the compensation plan varies. It all should be done manually.
But installing an efficient MLM software might help you in fixing such issues!
A Binary MLM Plan consists of mainly two legs: a Left leg and a Right leg. A sponsor can only have an immediate downline of only two people below him or her. Every new member will be placed under the sponsor’s Left or Right Leg depending upon availability of the space.
Bonuses that a distributor gets under the Binary compensation plan are as follows:
- Sponsor bonus
- Matching bonus
Benefits of Binary MLM Plan
- You can make returns from the success of your Upline.
- The payout limit is unlimited.
- It works more like a team game. The sponsors will be actively involved for the growth of their downline.
- The upline will be helping to build the other leg.
Matrix MLM Compensation Plan
A Matrix MLM Plan has basically two parameters, it’s the width and the depth. Generally, It is represented in the form “mxn”, where ‘m’ is the width of the matrix and ‘n’ is the depth of the matrix. The mostly common Matrix Plans are of the order 3×7, 4×7, 5×7, 3×9 and 2×12.
This plan provides you immense earning possibilities as compared to the Binary MLM Plan.
It can be explained as, in a 4×7 Matrix Plan, you can add only 4 members as his immediate downline, and the level can go up to 7 levels, which the compensation will be provided for.
Benefits of Matrix MLM Plan
- It provides higher money earning opportunities.
- The Matrix Plan allows you to grow unlimitedly or rapidly, which mostly the other compensation plans do not allow. earning income of you will be increasing as the number of new members also grow.
- Here, once you have filled your frontline distributors, then you can shift your focus to other areas like developing your front line executives into the posts of higher priority like leaders or more.
Binary Vs Matrix MLM Compensation Plan
Pay: Matrix MLM Plan pays more in comparison to Binary MLM Plan.
Implementation: Since the Binary MLM plan involves bilevel distribution of members, implementation is quite easier than the Matrix MLM plan.
Downline expansion: Downline expansion is easier in case of Binary MLM plan due to the Binary layout.
Downline structure: The down line structure of Binary MLM plan is different to that of Matrix MLM plan. Matrix MLM plan consists of multiple legs in which members are placed according to the parameters (width and height).
Downline Matching: Downline matching is not essential in case of Binary MLM plan whereas it is essential in the case of Matrix MLM plan.
Downline recruitment: In case of Binary MLM plan, a sponsor cannot influence the downline recruitment since the concept is that of Binary.Since the Matrix MLM plan has the concept of spillover, a sponsor can influence the downline recruitment to an extent.
Teamwork: Matrix MLM Plan is dependent on the teamwork of the entire network while this does not influence the Binary MLM Plan.