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Binary MLM Plans - 5 Issues You Should Understand
Binary MLM plans are unquestionably prominent now, so here are a few lessons from my own experience.
First, for the uninitiated, binary MLM pay plans have one distinctive characteristic: you have just two "legs" in your organization... a left leg and a right leg. Everyone you ever sponsor will be placed in a direct line, one under the other, down one of those two legs.
Here are 5 details you should know if you're considering joining a binary MLM compensation plan:
1. Use fear of loss to push recruiting.
In a binary, each person who joins is placed underneath the person who joined before them (in that leg.)
Not only does this offer "overflow" to your downline, which encourages cooperation and retention, but the skilled MLM sponsor can use this to drive recruiting.
"I have 5 people's paperwork here on my desk. If you join right now, I'll enroll all 5 of these underneath you. If not, that's cool... I'll just enroll you beneath them when you are ready to join."
There are "powerline" systems that automate this. It's compelling stuff.
2. Position is crucial.
Negotiate your position with your sponsor deliberately.
Some positions get more overflow than others. Your sponsor is going to want to place you where it helps them the most, but be careful. If your sponsor places you at the top of their inside leg, you won't get any overflow unless they continue to sponsor.
On the flip side, insisting to be placed to maximize overflow will help you... but it may not help your sponsor as much. So, they may be less willing to devote time and effort to assisting you to maximize your business.
There is no obvious best solution, which is why my suggestion is just to tread carefully. Don't just hop in without reasoning it through and talking to your upline.
3. TNSTAAFL.
Readers of Douglas Adams' "Hitchhiker's Guide to the Universe" know all too well... There's No Such Thing As A Free Lunch.
Even with the perfect position and a whole enterprise worth of overflow, a binary MLM still won't pay you a cent unless you recruit yourself. Overflow has to be matched with volume you bring to the table for it to be worthwhile. So, don't join a binary thinking that you're going to get something for nothing.
Also, when sponsoring someone it's great to reveal them about the overflow they may receive, but make sure they appreciate TNSTAAFL. It won't kill the sale... if anything, it'll prove them on you as a leader even more. And if you do lose them, you didn't want 'em anyway.
4. Teach your downline to sponsor outside then inside.
The first person you sponsor into a binary should go on the same side, either left or right, that your sponsor placed you on. This is called your "outside" leg.
The second person you recruit should go "inside," in the other leg.
The order is material... a lot of people enroll in an MLM sponsor 1 person and drop out. If that 1 person was placed outside, they will get overflow from their upline. If not, they will be working their business alone forever.
To guard against that, you should always teach "outside, inside."
5. The most stable binaries are hybrids.
Vanilla binary MLMs are no longer cutting-edge. In fact, there were several problems with them.
But, when "combined" with a unilevel, coded bonus, or other commission plan, those problems can be easily resolved. These hybrid structures-particularly the binary/unilevel-have proven to be very stable and fair to distributors.
They are the BMW of modern MLM pay plans.
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