Understanding a Unilevel Compensation Plan
What is a Unilevel Compensation Plan?
The Unilevel Compensation plan is one of the oldest and most established types of compensation plans in the Network Marketing industry. It's proven track record makes it still used even today by many companies. Like any other compensation plan though, the Unilevel Compensation plan does have its benefits and disadvantages.
How Does the Unilevel Compensation Plan Work?
As the name suggests, you are able to only sponsor one line of distributors / associates. This means that everyone you sponsor is one of your frontline distributors / associates. Unlike a Matrix Compensation plan, there is no width restriction to the number of frontline distributors / associates you can have when working a Unilevel Compensation plan. Commissions are paid out on a limited depth of distributors / associates within your organization. From the many plans that were reviewed, the commissions were usually paid on 5 to 7 levels deep. Thus the main goal in a Unilevel Compensation plan it sponsor large numbers or frontline distributors / associates and then encourage them to do the same.
Advantages to the Unilevel Compensation Plan
To start to earn commissions with the Unilevel Compensation plan usually only requires a minimal amount of personal volume. This is a very attractive feature to those that are starting their Network Marketing business on a part-time basis. They can start their business, and very quickly see an income starting to come in. In many cases faster than they would with either a Binary or Matrix Compensation plans.
Another great advantage of the Unilevel Compensation plan is it's ease in explaining it to new prospects. This ease in the compensation plan is as simple as the more distributors / associates you sponsor, the more money you make! Experienced Network Marketers, especially those who are great at recruiting, thrive in a Unilevel Compensation plan as they are able to make an extremely wide organization.
Disadvantages to the Unilevel Compensation Plan
One of the advantages of the Unilevel Compensation plan can also be seen as a disadvantage. That is in order to succeed and generate substantial income with a Unilevel Compensation plan structure, a new member needs to be a good recruiter and sponsor many distributors / associates. With the industry average being just under 3, it can be difficult for many people to make substantial income with this style of compensation plan.
Probably the main disadvantage to the Unilevel Compensation plan is every frontline distributor /associate you sponsor becomes a "crossline" distributor / associate with all your other frontline distributors / associates and thus a culture of competition is breed instead that of cooperation. This can cause many problems with newcomers sponsoring friends and families, as everyone is in competition with each other. Also included in this disadvantage is that the growing number of frontline distributors / associates requires continual training and having to manage large numbers of people.
Unilevel Compensation Plan Bonuses
For current Network Marketing companies that are employing the Unilevel Compensation plan, they have made changes and modifications to the pay scales to make it more attractive to new members and promote teamwork. Many of the modern day Unilevel Compensation plans include a number of bonuses as well as rank advancements to increase the amount of money a distributor / associate is earning.
Who is the Unilevel Compensation Plan Right For?
While there are many factors that come into making a decision as to what Network Marketing company to join, the Unilevel Compensation plan has historically been more suited for the experienced Network Marketer. As there is no limit to the number of frontline distributors / associates that can be sponsored, this puts emphasis on ones ability to recruit large numbers of people. For someone new to Network Marketing, this fact along with less teamwork than in a Binary or Matrix Compensation plan, could make seeing ones desired results more difficult.
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