When Comparing Binary vs Matrix MLM Compensation Plan – Which one do you prefer for your MLM business?
Like two sides of a coin, both Binary and Matrix MLM Compensation Plan has its own pros and cons. Well, we will discuss the respective compensation plans in this blog. And it’s up to you to decide among one.
But actually what are these compensation plans made for?
MLM compensation plans are the ones that determine the benefits that a network marketing company provides to its customers.
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The binary compensation plan is what allows us to add only two people under the sponsor’s downline. And the Matrix compensation plan is a little different from this.
Let us see down below.
Understanding In Depth About Binary MLM Plan & Forced Matrix MLM Plan
#1. Binary MLM Compensation Plan
The major role of a compensation plan is to deliver a portion (which can differ according to the network marketing company you work for) of the profit or sales made to its distributors or executives.
There are multiple compensation plans in existence and it includes Binary, Matrix, Unilevel, Board Plan, Hybrid MLM Plan and many more.
Calculation of payouts or other bonuses to its members become more complex as the compensation plan varies. It all should be done manually.
But installing an efficient MLM software might help you in fixing such issues!
Oops! We actually got deviated a little bit from the topic. We will come back to the Binary MLM plan now.
A Binary MLM Plan consists of mainly two legs: a Left leg and a Right leg. A sponsor can only have an immediate downline of only two people below him or her. Every new member will be placed under the sponsor’s Left or Right Leg depending upon the availability of the space.
So what happens when a sponsor recruits a new third member?
Well, he will be placed under the next available position in the left leg or Power Leg. And this concept is called Spillover.
Explore more to know How does Binary MLM Plan Works
Bonuses in Binary MLM Compensation Plan
Bonuses that a distributor gets under the Binary compensation plan are as follows:
- Sponsor bonus
- Matching bonus
Easily calculate the commission structure of Binary MLM Plan using Binary MLM Calculator
Some Benefits of Binary MLM Plan
- You can make returns from the success of your Upline.
- The payout limit is unlimited.
- It works more like a team game. The sponsors will be actively involved in the growth of their downlines.
- The upline will be helping to build the other leg.
Key Take Away
- Binary indicates a two-legged structure, where the distributor needs to recruit or sponsor two downlines.
- The two downlines will be placed either on the left leg or the right leg of the binary MLM structure.
- “Spill Over“-When more than two downlines are recruited, the downline will be placed in the next available position of MLM structure.
- Fast expanding plan which offers sponsor, matching bonus.
#2. Matrix MLM Compensation Plan
A Matrix MLM Plan has basically two parameters, it’s the width and the depth. Generally, It is represented in the form “m x n” Where, “m” is the width of the matrix and “n” is the depth of the matrix. The most common Matrix Plans are of the order 3×7, 4×7, 5×7, 3×9 and 2×12.
Easily understand the Working of Forced Matrix MLM Plan/Matrix MLM Plan
This plan provides you immense earning possibilities as compared to the Binary MLM Plan.
It can be explained as, in a 4×7 Matrix Plan, you can add only 4 members as his immediate downline, and the level can go up to 7 levels, which the compensation will be provided for.
Using Matrix MLM Calculator calculate the profit and loss of Matrix MLM Software
Benefits of Matrix MLM Plan
- It provides higher money earning opportunities.
- The Matrix Plan allows you to grow unlimitedly or rapidly, which mostly the other compensation plans do not allow. earning an income of you will be increasing as the number of new members also grow.
- Here, once you have filled your frontline distributors, then you can shift your focus to other areas like developing your front line executives into the posts of higher priority like leaders or more.
Binary Vs Matrix MLM Compensation Plan – A Comparison
#1. Pay : Matrix MLM Plan pays more in comparison to Binary MLM Plan.
#2. Implementation : Since the Binary MLM plan involves the bilevel distribution of members, implementation is quite easier than the Matrix MLM plan.
#3. Downline expansion : Downline expansion is easier in case of a Binary MLM plan due to the Binary layout.
#4. Downline structure : The down line structure of the Binary MLM plan is different from that of the Matrix MLM plan.
#5. Matrix MLM plan consists of multiple legs in which members are placed according to the parameters (width and height).
#6. Downline Matching : Downline matching is not essential in the case of Binary MLM plan whereas it is essential in the case of Matrix MLM plan.
#7. Downline recruitment : In the case of Binary MLM plan, a sponsor cannot influence the downline recruitment since the concept is that of Binary. Since the Matrix MLM plan has the concept of spillover, a sponsor can influence downline recruitment to an extent.
#8. Teamwork : Matrix MLM Plan is dependent on the teamwork of the entire network while this does not influence the Binary MLM Plan.
Have a quick glance to know the major difference between Binary vs Unilevel MLM Compensation Plan
Key Take Away
- The matrix indicates the “width X depth” structured matrix MLM plan and also known as Forced Matrix Plan.
- Width indicates the fixed number of downlines recruited at the frontline of the distributor.
- Depth indicates the fixed numbers of levels up to which the distributor can recruit the members.
- It offers sponsor, matching, position, level bonus.
When comparing Binary vs Matrix MLM Compensation Plan, Both the Binary MLM Plan and Matrix MLM Plan has its own set of advantages and disadvantages.
Choose the one which you feel suits your MLM companies working structure!
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