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Text File  |  1994-10-26  |  6KB  |  116 lines
  1.           
  2.           
  3.           
  4.           An MLM Plan In Action
  5.           
  6.           
  7.                For a look at how an MLM compensation plan may
  8.           work, here is a look at the structure used by Watkins. 
  9.           It's a good illustration of how the best MLM
  10.           compensation plans are structured.
  11.                The income plan is based upon a four-week "sales
  12.           campaign" schedule.  At the conclusion of each campaign
  13.           (there are thirteen campaigns in a year, so you
  14.           actually get paid 13 times instead of 12), your "Group
  15.           Retail Volume" (the total retail amount of your
  16.           purchases from Watkins plus those made by your
  17.           customers directly through Watkins and those made by
  18.           your downline representatives along with their
  19.           customers) will be used to determine your campaign
  20.           retail income percentage.
  21.           -------------------------------------------------------
  22.           ----------
  23.                 Representative Campaign Retail Income Chart
  24.           Group Retail Volume                Campaign Retail
  25.           Income %
  26.           $40 to $139                             28%
  27.           $140 to $379                            33%
  28.           $380 to $749                            38%
  29.           $750 to $1,139                          41%
  30.           $1,140 to $1,859                        43%
  31.           $1,860 to $2,679                        45%
  32.           $2,680 to $3,699                        47%
  33.           $3,700 and above                        48%
  34.           -------------------------------------------------------
  35.           ---------
  36.                You earn the retail income percentage on all
  37.           regular product purchases made by you directly or made
  38.           by your customers through Watkins.  In addition, you
  39.           will earn the difference between this percentage and
  40.           the retail income percentage earned by each first level
  41.           downline representative in your group.
  42.                Your total campaign income will be the sum of:
  43.                1.   Your campaign retail income percentage
  44.                     mutliplied by the retail amount of your
  45.                     regular product purchases and those of your
  46.                     customers ordering direct with Watkins.  The
  47.                     income on your purchases at the beginning of
  48.                     a campaing may be at a lower income
  49.                     percentage initially, but the final campaign
  50.                     income will be determined by combining all
  51.                     purchases during the campaign, and you will
  52.                     receive any additional income due you because
  53.                     of an increased income percentage.
  54.                2.   Each of your downline representatives (those
  55.                     you have recruited) will also be
  56.                     participating in this income plan, and since
  57.                     their individual campaign volumes are added
  58.                     to yours to determine income percentage, your
  59.                     income percentage will often be greater than
  60.                     theirs.  You will earn the difference between
  61.                     your income percentage and their income
  62.                     percentage on each first level (one you
  63.                     recruited directly) downline representative's
  64.                     campaign volume.
  65.                For example, if your personal orders from Watkins
  66.           during a campaign totalled $400; and the four first
  67.           level representatives in your group each had personal
  68.           orders of $300; then your total group volume for that
  69.           campaign would be $1,600 and the income percentage on
  70.           your personal orders would be 43%.
  71.                You would then also earn the difference between
  72.           the 43% and the percentage that your first level
  73.           downlines earn.  In this example, with each
  74.           representative selling $300 in product, their income
  75.           percentage would be 33% on their volume, and you would
  76.           earn the additional 10%.
  77.                To calculate your total campaign retail income in
  78.           this example:
  79.                $400 (your personal volume) x 43%
  80.                     (your campaign retail income)           =    
  81.           $172
  82.                $300 (first downline represenative's volume) x 10%
  83.                     (income percentage difference           =    
  84.           $ 30
  85.                $300 (second downline representative's volume) x
  86.           10%
  87.                     (income percentage difference)          =    
  88.           $ 30
  89.                $300 (third downline representative's volume) x
  90.           10%
  91.                     (income percentage difference)          =    
  92.           $ 30
  93.                $300 (fourth dowline representative's volume) x
  94.           10%
  95.                     (income percentage difference)          =    
  96.           $ 30
  97.           $1,600 total group volume
  98.           Your total campaign retail income                      
  99.           $292
  100.           
  101.           
  102.           Business supplies can raise your percentage level
  103.           
  104.                Watkins makes materials available for business
  105.           development -- such as catalogs, brochures, videos,
  106.           etc. -- and no commission is paid on these items.  But
  107.           the value of the items is added to the group volume for
  108.           the purpose of determining your campaign retail income.
  109.           
  110.                You can only make money with substantial product
  111.           sales.  Thus, make sure you're offering a good product
  112.           before signing up with an MLM company.
  113.           
  114.           
  115.           
  116.