Everyone in network marketing wants to know what the best compensation plan is.
The best comp plan is any that pays out the most residual money for the least amount of people. This allows even the part timer builder to see an income.
Which one is that? It is very easy to figure out.
First of all be sure you understand what “residual income” really means. Residual income is income that continues to be generated after the
initial effort has been expended. In network marketing it is the amount you’re paid on the autoshipments of your organization.
Now define what your monthly income goal is. Do you want to earn a couple of hundred dollars? How about $1000 or $3000? Maybe that isn’t enough so let’s say 10K.
Now, let’s have a look at your comp plan. What is the amount of money that you get paid on their autoshipment, not including any bonuses you may earn along the way, in order for you to succeed at your income goal?
Let’s say in a fixed 5×7 matrix you earn different amounts of the different tiers.
Lets say you earn 10% on the first tier, 6% on the Second tier, 5% on the third tier, then 3% on the next 3 tiers and 2% on the last.
Then we figure out what the average percentage we would earn from our distributors. 10+6+5+3+3+2+2=31/7=4.428
So roughly the average you would be paid per distributor in our organization is only 4%. It looked a little more impressive with a 10% and a 6% on the first two tiers didn’t it?
So now we can figure out what is 4% of the average autoshipment. In order to make this a simple math question, we will say you get paid on a $100 autoshipments. That is $4 per distributor.
You want to make $10 000 a month divide that by your $4 per distributor and let’s see what you get.
$10000/4%= 2500 people.
You will need an organization of 2500 active people in your team for you to earn $10K a month.
Keep in mind that the average builder brings in 2.7 people annually. That is an average, some people will bring in more but some won’t build at all.
To get your people building consistently you will need a system that anyone and everyone, regardless of their experience level can use. This establishes duplication. Without it, it could possibly take you years if not forever to build up to that income level.
Even if you were out only to earn $200 a month, you still need an average of 25 people that are active with their autoships.
Are you being paid what you’re worth? When are you going to be able to reach your income goal? How many active distributors do you need to reach that goal? How many people are you bringing in a month? How many people is your team bringing in a month? Do you have a system in place that is “proven” to work?
This is a business, and we need to approach it as such, then as you build you begin to enjoy it. But if You do not first ask the appropriate business questions to begin with, it will never become fun.
If you’re still not sure about any of these questions, please contact me
and I will help you to figure out your compensation plan and what YOU
need to reach your goals.
Henrietta
TheMentoringMom
Get What YOU Need to Find Success
