If you can’t understand network marketing compensation plans, you have a problem.

Yes it can be confusing when you are new to network marketing to understand the differences between the major network marketing compensation plans. They come with many different names such as Stairstep, Breakaway, Unilevel, Compressed Unilevel, Binary, and Matrix. These are the more common ones.

It gets more confusing when you have to understand the hybrids. As you guessed they are combinations of the common ones – Stairstep Breakaway, Compressed Unilevel, Dynamic compressed Unilevel, and the list goes on.

When you throw in the mirad of bonuses that are springing up such as fast start, achievement bonus, recruiting bonus, monthly matching bonus, infinity bonuses, leadership bonuses and so on is it any wonder there is confusing when trying to understand network marketing compensation plans. 

Personally I think it is prudent business to make sure you eventually understand and fully scrutinize the compensation plan.

However going into analysis paralysis is not the answer from the outset. Having a simple formula for working out when you will reach breakeven is.

IT’S A SIMPLE BUSINESS DECISION

Let me introduce you to what I call the 20 club. If you learn nothing more from this page then learn how to compare network marketing compensation plans.

This simple formula will give you a way of comparing network marketing companies comp plans and evaluating you how quickly you and your team can get into profit. It is a simple concept. You bring in 4 and then teach them how to do the same. 4 each = 16. The total would be 4 + 16 = 20

You
Level 1:  4
Level 2: 16
Total:   20

Now work out the total residual income you would receive each month. Not the fast starts or any other bonuses. They are just that bonuses and usually only paid once. It’s important to do the calculation on the residual income as this is the money that will keep coming in as long as you place your required order.

Now does your 20 club a least pay for your order? Can you see how this would help you?

Let’s face it most people would know 4 people who would know 4 people who would continue investing in their product if it was being paid for?

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