MLM COMPASS - Direction To MLM Success; A Proven Duplicable System » MLM Compensation Plan

The Best MLM Compensation Plan Ever

Don Standard — Sun, 29 Jun 2008 02:59:53 +0000

Would you know the Best MLM Compensation Plan Ever if you saw it?

What would it look like?

Something Simple? That would eliminate most of the new ones coming out. They are hard to figure sometimes just how good they may be. The simple ones, they can be figured out easily but most people still miss a lot because they don’t know what to look for and how it affects them. But the simple one’s usually don’t look so great to us.

How about a particular type? Binary, uni-level and more? No, that doesn’t do it. You can make any of them great by doing the right things with them. They can all be made to be horrible too.

But what makes one the best? The best for you. Are you the superstar or the newbie part timer? Does it matter?

The perfect mlm compensation plan does not exist. Why? Because it does matter whether you are the superstar or the part time guy. The perfect plan for the superstar is one that pays most of the money to the top guy; him. The perfect plan for the part time guy is the one that pays most of the money out early to him. So the perfect mlm compensation plan can not exist for everyone.

What about the Best MLM Compensation Plan Ever? Still debatable but a clearer issue.

Two things to look for in the plan.

First, how many people does it take to create a specific recurring income. Recurring is what we are interested in because we don’t want another job. We want to do things right one time and reap the rewards long term.

So how many people does it take to create a $10,000 per month recurring income? I have seen 400 active distributors to 40,000 active distributors from major companies where you do about 100 bonus points per month.

It should be obvious that all things being equal, the smaller the number the better. If Adam is in a company that needs 400 and Bob is in one that requires the industry average of 2000 active distributors then Adam will reach the $10,000 per month of recurring income while Bob is still at $2,000 per month.

See the difference? It’s huge. It’s like Adam is being paid $100 per hour for his work and Bob is only making $20 per hour. That should be easy to understand for those of you with a job mentality that you want to discard.

The Second Issue is, how hard is it to reach break even or better. When a MLM compensation plan sends most of the money to the top for the superstar, this has to leave a smaller pie for the people at the bottom. The superstar does deserve more. He effects more people. The team is there because of his work. But how much is the key. If you pay the top too much then it becomes too difficult for the guy at the bottom to reach break even.

I have seen top heavy plans that require 30 to several hundred people for a distributor to reach break even. The problem, is that the harder it is the higher the turn over. The higher the turn over, the more people have to be sponsored to find the number of active people needed.

Again the difference is huge. You want to lower the number of people sponsored as well as the number of active people.

So the Best MLM Compensation Plan Ever must balance this out.

The next question, might be, can the mlm compensation plan with the fewest number of people needed to create an example $10,000 per month of recurring income also be the mlm compensation plan with minimal requirements for the new guy to reach break even.

What do you think? Is that possible?

The answer is yes. It’s been done.

Now you can have the best of both worlds. And when you are at the top making big money, you can sleep well at night knowing that you have a team of people making money and your new guys have put themselves in the best possible position for success.

And that is what MLM compensation plan evaluation and company evaluation is all about. Putting yourself and your team into the best possible position to have MLM Success.

7 Questions Accountability Partner Bob Burg Build Relationships Colors To Success Color To Success Compensation Plan Don Standard duplicable mlm system duplicable system Facebook FortuneNow.com Free MLM Training free training calls Ground Floor Opportunity Jim Rohn Mentoring For Free Michael Dlouhy MLM Compensation Plan MLM Compensation Plans MLM Duplication mlm mentor MLM Policies and Procedures MLM Skills MLM Success MLM Success Ebook MLM WatchDog Penny Dude Personalities Policies and Procedures Proven Duplicable MLM System Proven MLM System Recurring Income Relationships Scam Social Networking Success In 10 Steps Terminations The Go-Giver Tom "Big Al" Schreiter Tom Schreiter Twitter Video YouTube YTB

MLM Retail Success

Don Standard — Sat, 28 Jun 2008 03:55:42 +0000

Hey, how many retailers do we have out there?

I bet not many. People ask me all the time, “How do you retail product.”

There are three issues here.

Skills
Belief
Business Model

First it certainly helps to have some MLM retailing skills. I think Tom “Big Al” Shreiter is the best there is at teaching these skills. You can go to his web site, Fortune Now, to get plenty of free skills for the part time network marketer and a paid site for professionals.

On the Fortune Now site, you will also find Tom’s workshop schedule. Be sure to attend when he comes to your area. The cost is about $20 for the 3 hour evening workshop. The best $20 you will ever spend.

Here are a couple of tips for MLM retailing. I am with a nutritional company. When talking to people about products, don’t be a product expert even when you know a lot about it. If you do, your customers and prospects will not join you in your business. I just say, “try it you might like it, and if you don’t there is a money back guarantee”. It works well and people see that they can do that so they join your business.

The big money is in mlm sponsoring, but it is very very important that everyone does some retail. Your people will reach break even easier and stay at or above break even if they retail. And when everyone on your team retails, your check will skyrocket. At least it will if you have a decent MLM compensation plan. One that rewards retailing.

The second issue is belief. Belief in yourself, your team, your company, and your product. Most people I talk to have very little belief in any of those. Your job as a sponsor is to believe in them until they can believe in themselves. The tip I gave above does wonders for people because most will never be product experts, and that is good.

With every small success comes belief. People believing in you will help your belief. This could be a post in itself.

The third issue is the MLM business model. Often times the products in network marketing are looked at as being expensive. If you believe that they are too expensive to retail, then you will struggle to retail them. So first let’s ask why do people buy.

Do people buy on price only? Can you sell a product that is not the lowest price?

Look out on the streets and parking lots. What do you see? Cars priced from maybe $10,000 to over $100,000. So people don’t buy on price. There is a quality difference between the cars though, so you don’t want to be selling an expensive product against less expensive equal products.

The big one is this. In your MLM business model, do people really retail the product? Some compensation plans, a part of the business model, do not reward retail sales with bonuses. If not, if the only reward is that you buy at wholesale and sell at retail, then you better have the easiest product in the world to sell or retail sales will be non existent.

The reason is those prices are set to get sales from distributors. They just stick an arbitrary mark up to that and call it retail. There is no market research done to see if people would consider the price for that product.

This compounds your problems because now you can’t retail and most of your team can’t retail. So each team member does a their minimum personal purchases which means you need many times the people to make the same income that someone in a company that has a MLM business model that promotes retail through their MLM business model.

Without the retail the only income is sponsoring a team. Many people will quit before they succeed.

When I chose my company the MLM business model was a major factor. So while the industry average is about 2000 active people on your team to create a $10,000 monthly recurring income, in my company it is 20% of that. So all things being equal if my friend joins the other company, I will always be making about five times as much as him with the same number of active team members and I will have a higher percentage of people who remain active.

Good info to know in advance. Don’t you think? Mentoring For Free

The Monster MLM Marketing Mistake

Don Standard — Wed, 25 Jun 2008 03:00:38 +0000

You’ve seen it.

You see it every day on the internet.

You are witness to the Monster MLM Marketing Mistake daily.

And most of you see it, then turn around and duplicate it, and fail and wonder why.

Many of you were told by your leaders to make the Monster MLM Marketing Mistake. So now you think that it is your fault you are failing when it is really their misinformation causing you to fail. It’s not your fault and I can prove it.

Some of you just see everyone else doing it so you follow the leader without questioning if it really works.

So, what is the Monster MLM Marketing Mistake?

You realize that when you know the answer and you are part of the 97% plus that are failing in network marketing, in part by doing this, that you are going to be upset.

You may start wondering, “What Else Am I Doing Wrong?”

Or, “What Other Worthless Info Have My Leaders Given Me?”

I should probably explain something to you instead of just shouting out the Monster MLM Marketing Mistake.

When you market on the internet, who is your target market? For most of you the target market is other network marketers.

Network marketers who probably have a companyor several companies, and your marketing approach is to tell them that you have the newest, below the ground floor, opportunity with a patented one of a kind compensation plan that pays to infinity, and the best product to ever come out of the jungle that can fix anything that they have ever heard of, and the company executives are all rich, family men with 3 family’s each to prove it, and of course no one can fail with their proven MLM system that is being offered for the first time anywhere today.

Let’s see. You had no relationship with the person. You insulted them by telling them how much better your deal is than theirs when you didn’t even know what they were in. You made a proposal to someone not interested in hearing about it. Kind of like asking a married person out on a date. Probably easier for you to see why that doesn’t work.

Most people have already joined and failed more than once. They heard the same stuff about those companies too. Their sponsor disappeared right after making the fast start money only to call or email a couple of months later asking them to join his new deal.

You failed to recognize that network marketing is a relationship business built on mentoring and training. People join people, not companies. You created no relationship, but just jumped right in with an offer. Hey, even if they liked the company why would they chose to sign up under you. Oh, please don’t tell me you lied about your experience too because you had no success of your own.

And then you wonder why the people that do join you drop out in a month or two. You wonder why the failure rate in network marketing is so high and you still can’t see that the Monster MLM Marketing Mistake is advertising your company.

That was it. Hope you didn’t miss it. Just a little thing but it means everything to your success.

In the three years that I have been in my company, I have never advertised the company. Why? Because people join people. Just solving the Monster MLM Marketing Mistake for people changes their MLM Success.

I know hundreds of successful network marketers who have never advertised their company.

To be fair, I know hundreds of network marketers who do advertise their company and had success and even more who failed.

The difference is that the ones that do not advertise their company have much higher success rates and duplication throughout their team.

That’s big. How big?

The average MLM compensation plan requires 2000 active people on your team for you to earn $10,000. Most people are clueless how many people they need with their company.

Now if your success rate is 80% then you need 2500 people on your team to find 2000 active ones. Not a realistic percentage , is it, but you get the idea.

At 50% retention, you need 4000 people.

But guess what. Retention in this industry is less than 5% so you need 40,000 people to get 2000 active ones. Can you really expect to do that?

If you are already locked into a company, then you can’t do much about the number of people you need to create your $10,000 per month income. But you can work on retention if you know what to do. That starts with correcting the Monster MLM Marketing Mistake.

If you are not locked into a company, then I suggest you figure out how many people you really need in your company and what other possibilities exist. There are well known companies that require 40,000 active people to achieve $10,000 per month recurring income. I hope you are not in one of those.

If you could find a company that required only 400 people to create a $10,000 per month income but you still only had a 5% retention rate, at least now you need a total of 8,000 people instead of 40,000.

Change the retention rate and you improve on that. And changing the retention rate starts with solving the Monster MLM Marketing Mistake.

To learn more, contact me, or sign up at Mentoring For Free. You can get free training on what really works today from network marketers doing it successfully today.

Your MLM Compensation Plan – Question Three

Don Standard — Mon, 16 Jun 2008 03:03:14 +0000

7 Questions To Know About Your MLM Compensation Plan

We asked the 7 Questions in one post. Then answered the first two questions in two other posts.

Time to answer question 3 now.

Question Three: Which team members do you get paid on, your “pay line”?

Great question and one that most people don’t understand. People just seem to think they get paid on their entire downline.

Let’s look at an example. In a unilevel plan you can build as wide as you want. There are no restrictions on width but they do have a restriction on depth, usually around five levels or so. For this example let’s just assume that there are no additional ways to earn recurring income. Of course in todays compensation plans there are many ways to earn which tends to confuse things even more. But in this simple plan you get paid on everyone in your first five levels. That is your payline. You make nothing on anyone in your downline beyond the fifth level, levels 6 to infinity.

Another easy example is the matrix plan. The matrix will tell you how deep they pay. A 5×7 would pay seven levels deep. That is your entire pay line. You get paid nothing on the levels eight to infinity.

I will go into this in more detail in another post one day but the shape of your team in terms of numbers of people per level will always be diamond shaped. So if the widest part of the diamond was your bottom pay level then you are only getting paid on half of your team.

If the widest part of the diamond is at your tenth level and you only get paid to your fifth, then you are getting paid on about 17% of your team.

That is why newer compensation plans usually add additional ways to get paid on your team outside of the pay line created by the unilevel or matrix plan.

However there are a lot of plans available that do not pay you on the people outside of your main pay line and others that pay so little or make it so difficult to earn the bonus that they are just making it look like you can earn a lot of money while creating breakage for the company.

So you need to know the pay line not only on the basic part of the plan but on each added way to get paid.

You need to know the answers to all 7 Questions for this to all come together for you.

In the end even if you have great success with your company, the compensation plan and how they pay you on the people real deep in the organization will have a major impact on your income.

Don’t wait to build a team of 100,000 people before you learn that you only get paid on a small percentage of them.

Learn even more in group training at Mentoring For Free.

Scam Research

Don Standard — Sun, 15 Jun 2008 20:31:09 +0000

Internet MLM scams seem to be everywhere.

At Mentoring For Free, we teach people to avoid MLM scams and bad MLM companies. It is just a small piece of the valuable free skills training that we teach.

I am going to show you one of the simplest techniques to avoid being scammed.

All you have to do is some simple Google research. When looking at a program, just Google the program and the people running it as a scam.

Here is an example using BurnLounge. Your Google search would look like this.

“BurnLounge” scam

I put BurnLounge in quotes, not because it had to be, but just as a reminder to you that anytime you have a company with two or more words in the name or a persons name, then you use the quotes to avoid unwanted search results.

Now you have your search results on – “BurnLounge” scam. When the results are a huge number of pages you pretty much no you have a scam already. But remember that these results do not always find a scam.

These results simply have the name you put in quotes and the word scam on the same page. So someone could be using scam on their page to get attention. Or they may be telling you that this is not a scam.

Read the results on page one. More if you need too. You will find people claiming a scam and possibly some defending the company or person as not being a scam. Real scams will have overwhelming results suggesting a scam.

You will almost always get Google results even on the cleanest companies. Read your results.

The reason I chose BurnLounge to use as an example is because they are no longer in business. Secondly the evidence of a scam was huge. Very recently the company websites disappeared from the internet.

When this publicly traded company launched, I quickly realized that they met the definition of an illegal pyramid. Don’t let the fact that a company is publicly traded trick you into thinking that this fact makes them legal. It doesn’t.

The Federal Trade Commission (Wired) stepped in a year or so later and said the same thing. BournLounge disagreed for about 2 days before eliminating the MLM compensation plan and avoiding going to court.

There are so many programs on the internet that if you did a search on the company’s, you would be shocked at all the reports from people claiming to have been scammed.

The same holds true for individuals. Try this google search.

“phil piccolo” scam

Now I don’t know Phil. Only know what I see on the internet. But if I did this search then I would not be involved with him. It is just that simple. I don’t want to take a chance. Maybe you read these same Google search results and decide there is no problem. So we may each see things differently. You get to decide.

Hopefully you will start doing some basic research like this before spending your time and money on scams. You are going to be amazed how many new programs come along that are being run by people with many scam complaints against them.

You will also be amazed at how many people running new programs have no internet identity except what it says about them on the company website. How can that be?

Happy Googling.

Your MLM Compensation Plan – Question Two

Don Standard — Fri, 13 Jun 2008 19:10:27 +0000

Two days ago on, 06/11/2008, I did a post called, “7 Questions To Know About Your MLM Compensation Plan”. On 06/12/2008, I answered question one.

Now we are ready to tackle question #2 and it is another big one.

Question Two: How many active people do you need on your team to break even after all expenses just from your recurring income?

I have found the most common break even requirements to be between 20 and 60 active distributors.

Think about all the people you have ever sponsored or even came close to sponsoring. How many of those people have ever built a team of more than 20 people?

The first reason you need to know the answer to this question is because the more active distributors that are needed for someone to reach break even, the fewer people will get there to become successful. The higher the number goes, the higher the turn over rate is.

From question one we learned that the average MLM compensation plan will require 2000 distributors to make you $10,000 per month. If everyone who joins your team is successful, then you need 2000 active distributors to earn $10,000 per month. But what if only one half or successful. You still need 2000 active distributors but you had to have 4000 people join to find those 2000.

But what if only one out of ten stick it out? Now your team needs to sponsor 20,000 people to get 2000 active distributors. And some programs are so difficult to reach break even in that you can figure that only one out of every one hundred will stick it out so you will need 200,000 people sponsored to get 2000 active ones.

What if you think your company has the best compensation plan in the world and one day after you have spent years building it, you discover how many people you really need. Best to find out now.

Hopefully you already know that network marketing is not a numbers game, it is about building relationships and teaching and mentoring. If you choose a business where almost no one can break even then you have turned it into a numbers game.

I build my business 95% with the internet and the telephone. If you are doing the same then you should also know that people on the internet are exposed to many businesses. If your business even seems hard to break even in after a couple of months, then they will move on to another business that promises them more.

To avoid this, you choose a company that gives everyone the best chance for success and can get them to break even quickly with the compensation plan.

You build relationships. If you have no relationship, it is much easier for someone to quit the business you sponsored them into.

You use a system like, Mentoring For Free, to train your people in everything they need to know to have success in network marketing. It must be a proven duplicable system. One that works for anyone, not the so called systems that are nothing but numbers games.

I have evaluated hundreds of compensation plans and I have found some that require very small numbers of people for a distributor to break even just on the recurring income, and I have found some that require over 400 people to break even.

You guessed it, people in the company that takes 400 people to reach break even believe that their compensation plan is the best in the industry.

I have found the most common break even requirements to be between 20 and 60 active distributors.

Think about all the people you have ever sponsored or even came close to sponsoring. How many of those people have ever built a team of more than 20 people?

So even with the low number, you can see you may have a problem. You want your compensation plan to require the fewest number of active distributors possible for break even to improve your chances and the chances of everyone you sponsor.

Mentoring For Free, training will help you learn to evaluate compensation plans and other information about companies so that you can put yourself in the best possible position for success. Then we will train you and everyone on your team in all the skills you need for success in network marketing.

If you have not been properly evaluating the compensation plans of the companies you tried to build, no wonder this all seems so hard to find success in the industry. If you are building something now, then stop and evaluate it. If you are looking for a new company then take the time to properly evaluate everything about the company that affects your success. We call it the 5 Pillars.

7 Questions To Know About Your MLM Compensation Plan

Don Standard — Thu, 12 Jun 2008 04:35:36 +0000

No longer am I amazed by peoples lack of understanding of their chosen MLM company’s compensation plan.

What should you know about how your MLM compensation plan works? How many of these questions can you answer?

How many active people do you need on your team to earn $10,000 per month in recurring income?
How many active people do you need on your team to break even after all expenses just from your recurring income?
Which team members do you get paid on, your “pay line”?
What are the requirements to get paid?
What are the requirements to get paid on all of your potential pay line?
How much do you really get paid on retail sales?
How does that infinity bonus work?

If you don’t have the answers to these questions, and I mean you really know for sure that you know the answers then you need to stop and figure it out now. It’s that important.

Don’t wait until you finally make $10,000 per month in recurring income to see that you needed 3500 active team members to make that income. Number one it means that since you didn’t know the answer in advance, you couldn’t put together an accurate business plan. And wouldn’t you hate to learn later that your friend that you decided not to join in his network marketing company only needed 350 active team members to make the same income.

So hopefully you understand the importance of knowing this information. I think it is so important that I am going to do several posts to explain the reason you need to know this information and why the answers that you think could be right may be way off.

Sign up for our RSS Feed so you will be sure to catch the answers to each of these important questions.