MLM Binary plan is a most preferable /popular among companies and most widely accepted all over the world. There are many advantages to the binary compensation plan, the first of which is the simplicity of the plan. It is attractive to all members and its simplicity allows for an easy understanding of the pay scale that a member will receive.
The Binary Compensation plan as the name indicates works off the power of 2. The number 2 of course represents the maximum number of frontline associates that any business center can have. Additional distributors / associates who are introduced to the business are then placed under one of the existing frontline associates, as shown in the image above.
How MLM Binary plan works?
Binary MLM plan is based on a matrix of two. This means that you can only sign up or recruit 2 people into your first level down line. Here the profit margin depends entirely on your downline being active. That is if one of your legs is inactive, then you will not receive much money. Only if your downline is even will you profit well from a binary system.
Binary Compensation Plan Commissions:
There are three types of bonuses paid in the Binary MLM compensation plan.
1. Introducer or Sponsor Bonus or Fast start Bonus
Direct Referral commission:
When you directly refer a new Member they can either be placed in the LEFT OR RIGHT POSITION under you. For every direct referral you make you will be compensated with the Sponsor/Referral bonus of xx USD or xx %.
Some companies will have different packages to choose while register, So direct referral commission % will be calculated based on the package your downlines choose.
Commission amount will automatically be credited to your account upon completing the registration process of your downline.
Pairing Bonuses are calculated from your binary tree, which has two legs: a left and a right. Members placed above you may also place people in your Binary Tree. Your daily maximum Pairing Bonus will depend on your plan type. When you reach the daily maximum Pairing Bonus you will not amount for other pairing you made on that day.
Your referred member can be placed her in your left side or right side. Each complete left and right combination is referred to as a pair 1:1, 2:2 etc. So you will earn Pairing Bonus
Some company business plan may allow you to earn Pair bonus based on the points. You will earn Points every time you accumulate members on the left and on the right groups of your binary structure. Points are accumulated from group entries. The Commissions are calculated by matching the points (points) earned under Right Leg & Left Leg. You would typically earn a commission on the Entire Volume of your weakest Leg points.
The points matched above the weekly points will be flushed out and un-matched will be carry forward. Binary plan may have limit of capping per day. If capping limit is 1000 $ then if you have sales more than $1000, then remaining will be flush out.
Matching Bonus allows you to earn an additional xx % of the Pairing Bonus of your directly Referred Members up to N generations depending on your plan type.