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MLM Compensation Plan Bonuses - Tuesday, March 4, 2014


MLM Consult Scott H Leonard 1-888-221-0106MLM Compensation plans will often use a Bonus, or a combination of Bonuses to attract Independent Sales Representatives to their Sales Force.  Below are some common Bonuses.

Wholesale/Retail Bonus (WRB)
Generally considered the First Bonus available to any Sales Representative, regardless of qualification. Sell products to end consumers, in person or by the company Website. End consumers pay retail price and the Sales Representative enjoys the difference between the consumer purchase price and the Sales Representative's wholesale purchase price.

Fast Start Bonus (FSB)
An instant 'Spiff', normally tied to specific sku's, this bonus is triggered upon the sale of a specific product and normally carries a specific dollar amount or % of CV.  This bonus could be available to specific ranks, but is often available to entry level Sales Representatives, without other qualification requirements. Many companies will put a Fast Start Bonus on an Optional Product Assortment at the time of enrollment. This would benefit the Sponsor of the new Sales Representative who chooses to make an initial purchase. Sometimes referred to as Seller Fast Start.

Fast Start Bonus Tier 2 (FSB T2)
The ability to assign an additional benefit to the Sponsor of an individual receiving the regular Fast Start Bonus. Sometimes referred to as Sponsor Fast Start.

First Order Bonus (FOB)
A dollar amount or % of CV from the First Orders made by Customer or New Personally Enrolled Sales Representatives.  Normally, when this bonus is used, the majority of available CV is used in the bonus which then requires that the items on this invoice not be included in CV totals and the regular compensation plan calculations.  Future purchases by the same individual would provide CV disbursement based on the stated compensation plan.  Sometimes referred to as Seller First Order.

First Order Bonus Tier 2 (FOB T2)
The ability to assign an additional benefit to the Sponsor of an individual receiving the regular First Order Bonus. Sometimes referred to as Sponsor First Order.

Customer Acquisition Bonus (CAB)
A Bonus, normally a % of CV, for acquiring new customers. This is a good bonus to use when the company goal is to encourage the Sales Force to be focused on Sales Performance to End Consumers.

Sponsor Bonus (SB)
A Bonus, normally a % of CV, or $ for sponsoring a new Sales Representative.

Matching Bonus (MB)
Normally an amount equal to a % of a sales commission earned by your personally sponsored Sales Representatives.  Example: I Sponsored John who earns $500.  If I am qualified for a 10% Matching Bonus, John would earn his commission, and I would also earn $50 as a Matching Bonus.  Some companies will combine the Matching Bonus with a Generational Bonus.  This method would provide a Matching Bonus through Generations of Personally Sponsored

Infinity Bonus (IB)
The potential to earn a % through infinity, or until blocked by another Infinity Qualified member of your Sales Force.  Some plans allow multiple Infinity Bonuses.  If I am qualified for the 10% Infinity Bonus, I would earn 10% through infinity, or until I reach another Infinity Qualified member of my Sales Force.  If that Member is a qualified for a 5% Infinity Bonus, then he would earn his Infinity Bonus within His Sales Force, and I would be left to earn 5% within his Sales Force, until reaching another Infinity Bonus Qualified member.  If in my Sales Force, I meet someone who is also qualified as 10% Infinity Bonus, then I would be left with 0% Infinity Bonus within his Sales Force.

Generational Bonus (GB)
The potential to earn a % through my Sales Force until reaching another member of My Rank or Higher.  Some programs will offer multiple Generations.  Gen1 10%, Gen2 5%, Gen3 2%... in this example, I could earn 10% in my Sales Force until reaching a member of My Rank or Higher, I would then earn 5% in His Sales Force until reaching another member of My Rank or Higher, I would then earn 2% until reaching another member of My Rank or Higher, then stops.

Bonus Pools (BP)
Profit Sharing or Bonus Pools are established by setting aside a portion of every sale made by a company.  Those funds are then divided among qualified individuals, or they are split into sub pools and then divided.  Generally, there are two methods for division. Earned shares based on Sales Performance, or equal division of everyone in the pool based on equal rank or higher.  The later is preferred.

Dominate your competition by Empowering your Sales Force with real MLM Software Solutions, DB44 by Inspetta! Call: 1-888-221-0106

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MLM Industry Terms and Lingo - Tuesday, March 4, 2014


MLM Consult Scott H Leonard 1-888-221-0106 As with any industry, not knowing the lingo is a quick identifier of a 'Green Horn' and often leads to being taken advantage of.

On this page, I will attempt to add terms, and explanations, in order to provide a good resource for the industry.  This particular page will be a work in process, as I am often busy with clients.

Affiliate Marketing: Refers to the method of marketing a company's products or services through a sales channel or network of individuals.  Most companies that state they are an Affiliate Marketing company utilize a multi-level or DownLine levels for calculation of commissions.

AutoShip: Refers to an automatic re-purchase of a company's product or service, according to a schedule.  Normally, an identified Product, Price, and Date of regular re-purchases is defined.

Bonus Pools (BP): Please see MLM Compensation Plan Bonuses.

Customer Acquisition Bonus (CAB): Please see MLM Compensation Plan Bonuses.

Cold Market: Refers to persons who you have no direct contact with, or knowledge of how to build a line of communication with.

Commissions: Refers to an earned benefit from Sales Performance, often within your Sales Team.

Compensation Plan: Refers to the Model/Payment Schedule, used for identifying, calculating, and demonstrating Qualifications, Rank Advancement, Bonuses, or Commissions based on Sales Performance.

CrossLine: Refers to Income Centers located Beside you.  They are neither in your UpLine or DownLine.  (Please see Relationships)

Distributor: Refers to individuals who affiliate themselves as Independent Representatives, with the Goal to market a company's products or services to end consumers and with the Hope of earned benefit for Sales Performance.

DownLine: Refers to Income Centers located Below you.  Normally making up your Sales Force or Sales Team.  The Sales Performance of these Income Centers is often used for Rank Advancement and/or Commission Calculations.  (Please see Relationships)

First Order Bonus (FOB): Please see MLM Compensation Plan Bonuses.

First Order Bonus Tier 2 (FOB T2): Please see MLM Compensation Plan Bonuses.

Fast Start Bonus (FSB): Please see MLM Compensation Plan Bonuses.

Fast Start Bonus Tier 2 (FSB T2): Please see MLM Compensation Plan Bonuses.

Generational Bonus (GB): Please see MLM Compensation Plan Bonuses.

Income Center: Refers to a position in a DownLine or Compensation Plan Structure, representing the Independent Representative and the Customers belonging to that Independent Representative.  Important to note is that Customers and the volume of those customers is represented within the Income Center of the Independent Representative.  Customers are not represented in that Independent Representative's DownLine is made up of the Income Centers of other Independent Representatives making up the Sales Team.

Independent Representative: Refers to an individual who chooses to Independently represent a company's products or services, according to the company's Terms and Conditions, as well as Policies and Procedures.  Normally, earnings are reported via 1099.

Infinity Bonus (IB): Please see MLM Compensation Plan Bonuses.

Legs:  Legs are mostly, but not exclusively used, when speaking of a Binary Compensation Plan Structure.
In a Binary Structure, you visualize Two Legs, a Left and Right.  Some companies refer to each person on your frontline as a leg.  Thus, even a UniLevel or Matrix may refer to Legs.  In this case, they would not be Left or Right, but Numbered.
A Leg Methodologies Examples follow:

BINARY

You
/      \
    (Left Team)  Left Leg         Right Leg  (Right Team)

 

UNILEVEL/MATRIX
                    You                  
          |         |         |         |         |...etc.
  Leg1   Leg2   Leg3   Leg4   Leg5

Genealogy: Refers to the downward progression of Income Centers, beginning with your Income Center.  The Genealogy may be demonstrated with as Limited or Unlimited, in either Width or Depth.  Fundamentally, the Genealogy is made up of Income Centers who market a company's products or services to end consumers.  These Income Centers make up your Sales Team and their volume may be used for determination of your qualification, rank advancement, or commission calculations.

Matching Bonus (MB): Please see MLM Compensation Plan Bonuses.

Multi Level Marketing: Refers to the method of marketing a company's products or services through a sales channel or network of individuals.  Most companies that state they are a Multi Level Marketing company utilize a multi-level or DownLine levels for calculation of commissions.

MSRP: Refers to Manufactured Suggested Retail Price.  Often used to demonstrate the promoted value of a product or service by a manufacture and often separate from the actual Retail or Selling Price.

Network Marketing: Refers to the method of marketing a company's products or services through a sales channel or network of individuals.  Most companies that state they are a Network Marketing company utilize a multi-level or DownLine levels for calculation of commissions.

Pyramid/Pyramid Scheme: Refers a business structure which is unethical, immoral, and probably illegal.  Important is that a structure is not so much illegal, as the methods, actions, or activities employed.  The structure may resemble the structure of traditional business CEO, President, VP 1, VP 2, Sales Managers, Sales Agents, etc.  This comparison has been performed many times to justify the structure.  The problem is not so much in the structure, but the actions  Specifically, most countries impose laws against an 'Endless Chain of Recruiting", as there is normally no clear business model of selling to end consumers.

Recruit: (verb)Refers to the Action of Sponsoring new Independent Representatives to your Sales Team.  (noun)It may also refer to the new Independent Representative.

Residual Income: Refers to regular earned income from the Performance of your Sales Team.

Retail: Refers to the Selling Price to End Consumers, either Person to Person, or from a website.  It is normally intended to be the price a Customer pays, which often separate from the Distributor/Independent Sales Representative Wholesale Price.

Relationships: "UpLine" refers to those income centers above you.  "CrossLine" refers to income centers beside you.  "DownLine" refers to income centers below you (Your Sales Team).

UpLine
/\
|
CrossLine <---    YOU    ---> CrossLine
|
\/
DownLine

Sales Force/Sales Team: Refers to your DownLine or Genealogy of Income Centers who sell the company's products or services to end consumers.

Spill/SpillOver: Refers to the automated placement within a Limited width organization, such as a Binary or Matrix.

Sponsor Bonus (SB): Please see MLM Compensation Plan Bonuses.

UpLine: Refers to those Income Centers Above You.  In some Compensation Plans, your UpLine is your Sponsor, and then his Sponsor.  Not every Compensation Plan is based on a Line of Sponsorship, thus a Binary and Matrix are seldom represented with your UpLine immediately being your Sponsor.  (Please see Relationships)

Warm Market: Refers to those people which you know and may be able to reasonably contact to discuss the products or services you sell.

Weak Side/Weak Leg: Refers to a the Front Line Leg with the Least Sales Performance.  Example: 10% Weak Side Binary refers to a compensation plan that offers a potential earned benefit equivalent to 10% of the Sales Performance of your Lessor Leg.

Wholesale: Refers to the Distributor/Independent Representative Special Pricing.

Wholesale/Retail Bonus (WRB): Please see MLM Compensation Plan Bonuses.

Dominate your competition by Empowering your Sales Force with real MLM Software Solutions, DB44 by Inspetta! Call: 1-888-221-0106

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How to Spot an MLM Scam - Tuesday, March 4, 2014


MLM Consult Scott H Leonard 1-888-221-0106

For over 20 years, friends would knock on my door to get advise on an MLM. Normally, that is a tell-tale sign of an impending pitch, however each of them knew I was about to put their program through the meat grinder. I will try to be as simple and straight forward as possible.

Turn the application over and look for these words “No Purchase Necessary”. Don’t see them?
     A: Beware.

Look on the face side of the application, are you required to buy a company’s product or service to join?
     A: Shred it.
(Note, a reasonable application fee or back office fee is ok. Product Purchase requirement is a Red Flag)

Is the Representative strong arming you to buy the “OPTIONAL” Product Pack?
     A: Tell him to get lost. You don’t want to be part of this guy’s sales team.

If product purchase is optional, make your decision. Do you need the product, will you use the product, can you sell the product, is it more product that you will use or sell in an average month?
   Is the Business NEW?
   Is the Corporation behind it NEW?
   Is their MLM Software in place?
   Is their website live?
   Is their product packaged and ready to be shipped?
   Is the company Founder/President/CEO named?
   Can you walk into the office and meet the corporate team?
   Is the company registered to off a Business Opportunity in your state?
   Is the company registered with the BBB?
   Is the Product NEW?
   Is the Product Food Based or Nutritional?
   Do they have FDA approval?
   Do they have Doctors or Professionals endorsing who you can verify?
   Do the ingredients or dosage create health risk?
   Is the product needed on the market?
   Is the product consumable?
   Is the product fairly priced when comparing to stores?
   Do they have current inventories of 20 times the current membership of the company and ability to sell, deliver, and restock five times as much within a 30 day period?
    A: Many companies struck the perfect product, in combination with tremendous growth.

A delicious low fat brownie introduced to a company with 1,000 members could sell/buy 1,000 x Dozen in first month. If recruitment occurs of customers and sales reps, the next could have 10,000 x Dozen.
Imagine the manufacturing facility that must rapidly increase it’s production in such a short period.
Staff, floor-space, equipment, raw ingredients… it is not easy........

Dominate your competition by Empowering your Sales Force with real MLM Software Solutions, DB44 by Inspetta! Call: 1-888-221-0106

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Zero Upfront Cost MLM Start Up Software - Tuesday, March 4, 2014
MLM Software Central .com offering Start Up MLM Software provided for FREE, for select MLM Companies.  *Requires Managed Services (hosting & support) Contract
  • We reserve the right to turn down any potential client
  • Real Product/Service Companies, no money games
  • Your desired Compensation Plan must be Documented and Fit in our Start Up MLM Software
  • You provide 5 pages Html Content, Design and Images
  • Requires Managed Services (hosting & support) Contract
  • Program may be cancelled at anytime

What does it include?

  1. Your html pages, as provided on the Root of our MLM System
  2. Integrated public eCommerce System
  3. Subdomain Replication for all Distributors
  4. Tracking of Sales and Signups to every Rep
  5. Distributor Back Office, Genealogy, Sales, Earnings Info, Corp Resources
  6. Corp Admin Back Office, Manage Members, Products, Commissions
  7. Hosting and Support
Yes, it is upgrade-able.
Yes, we can customize. Based on your written requirements an estimate can be provided.
Yes, we can do Custom Designs.
Yes, we can do Mobile Friendly Designs.
 
Interested?
Get your requirements written down and call us.
1-888-221-0106
 
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