A Binary MLM Plan employs a Two Legged (Left leg, Right Leg) structure in Multi-Level Marketing where each new distributor or member is placed on either left or right subtree. One subtree is known as a Power Leg or Profit Leg while the second subtree is a Profit Leg or a weak leg.

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Binary MLM SoftwareBefore looking into the structure, try to understand the difference between a Sponsor and the Parent of a downline.

**Sponsor:** The distributor who introduced the new member to the binary network.

**Parent:** The distributor, who is the direct upline of the new member introduced to the binary network

If a distributor X sponsors A and If A introduces a new member B to the left position of A in the binary tree, then B is the direct downline of A. If again A sponsors a new member C, then it is added to the right of A since it was the vacant position. Now B, C are the direct downlines of A and the binary of A is formed to get the binary commission. A is the sponsor as well as the parent of B, C.

Here X sponsors A and Y, where Y is placed under the right leg of A and now A sponsors new member B, where B is placed under the left leg of A since there is no vacant position at the left leg of A. Now For Y, A is the parent and X is the sponsor. Here the sponsor and the parent are different for the downline Y. The binary of A is formed from its own effort and the upline’s (X) effort by spilling over the member Y.

Distributor X introduces or sponsors two new members A, X1 to the right, and the left leg of binary structure and binary of X is formed. Now A sponsors new member B to the right leg as the left position of A is filled by the new member Y, who is sponsored again by X. X also sponsors Z and places to the right of X1. Here Y, Z is spillover and placed under the downlines of X i.e A and X1. Y is placed under the left downline of X i.e A and Z is placed under the right downline of X i.e X1 When you look into the picture, it is understood that the two spillovers occurred on two sides of X without completely forming the binary on either side.

In this scenario, When A introduces two new members B and C. B is placed under the direct left leg position of A, and C is placed to the direct left leg position of B. Here C is the spillover which is placed to the extreme left.

When the left and the right leg of any member is filled, the next new member sponsored will be placed under the next level as spillover. This is called normal spillover. When the distributor X sponsors new members A and X1, the binary structure of X is completed, and if X again sponsors the new members Y and Z, they will be placed under the next level as normal spillovers.

When the binary structure is formed for a distributor by introducing two new members to the right and the left leg, the next new members sponsored by the same distributor will spill over to the next available position. Where the spillover to be placed i.e the preferences of spillover depends upon the MLM company.

Binary Capping is the amount set by the MLM companies to maintain financial stability. The turnover of the company may affect if the commission payout goes out of control. Binary Capping will depend upon **Commission or Sales Volume**

MLM Binary plan may have a capping (the limit or restriction on pricing or expenditure) per day. This limitation is based on the company’s rules.

Here, we are calculating the commissions earned by **A , B , C** and **D** in this binary network.

All the calculations done here are based on **10% P.V.**

Here, we would be calculating the commissions received by **A.**

- In this network, A recruits B and C (B = 100 PV and C = 100 PV ). Since the volume of sales on both legs are equal and they are matched,
- Commission with respect to A
- Commission earned by A = 10% of 100 = 10 USD.
- In case the commission earned on both legs is not matched, then we will consider the leg with the lowest P.V, called the weaker leg, for calculations.
- Commission from B
- Now, B recruits D and E.
- With respect to A , D and E will fall on its left.
- D manages a P.V of 100 while E manages 200 P.V.
- So the total PV on the left = 100+200 = 300 P.V.
- On the right, C recruits F and G and F and G manages a P.V of 100 each
- So, the total PV on the right of A = 100+100 = 200.
- Going by the matching on the basis of weaker leg, right leg is the weaker leg since it could raise only 200 PV in comparison with 300 PV on the left side.
- Hence, 200 PV from the right leg of A is matched with 200 PV from the left leg and the remaining 100 PV from the left will be carried forwarded on the left side of A.

- Therefore, the commission earned by A from B and C = 10% of 200 = 20 USD.
- Therefore, the total commission earned by A = 10+20 = 30 USD.
- Commission with respect to B
- B recruits D on the left and E on the right.
- D earns 100 PV while E earns 200 P.V.
- Since the left leg is the weaker leg , 100 PV from the left and right is matched. The remaining 100 PV from the right is carried forwarded to the right leg of B.
- Commission earned by B = 10% of 100 = 10 USD
- Therefore, the total commission earned by B = 10 USD.
- C recruits F on the left leg and G on the right leg . Both F and G generate 100 PV each.
- For C, since P.V on both the legs are equal, 100 PV on left leg is matched with 100 P.V on right leg and there is no carry forward in this case.
- Commission earned by C = 10% of 100 = 10 USD.
- Therefore, the total commission earned by C = 10 USD.

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