Unilevel and Matrix Compensation Plans are the two leading compensation plans that come under modern Multi-Level Marketing or MLM Strategies. Both MLM Plans help to succeed in this increasingly competitive environment.
Unilevel Compensation Plan
The Unilevel Compensation plan is one of the oldest and well-established compensation plans in the Network Marketing industry.
As the name indicates, the Unilevel MLM Plan permits you to sponsor only one line of distributors, so everyone you sponsor is on your front (i.e no spillover). There’s no width limit on this plan and the commissions usually paid out at a specified level depth.
The purpose of this compensation plan is to recruit as many members of the team first and then line them even. In this plan, the depth is limited but you can build as wide as you want. This limitation in-depth inspires distributors to build wide. The primary feature of a Unilevel compensation plan is the payment of a level commission to all qualifying distributors. In MLM plans, one of the oldest compensation plans, the stairstep Breakaway Plan starts like a Unilevel MLM plan.
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Advantages of Unilevel Compensation Plan
- Unilevel MLM plan is the easiest, MLM structure.
- To start to earn commissions with the Unilevel Compensation plan usually only requires the least amount of personal volume.
- Faster Bonus and solid residual income
- All distributors are paid the same percentage of commission on their downline sales.
- Easy for distributors to explain to their prospects.
Disadvantages of Unilevel Compensation Plan
- No Spillover
- Not Much possibility of rapid downline development
- It can be difficult for many people to make a substantial income with this style of a compensation plan.
- Unilevel Plan is the plan where all the downlines of a distributor are placed in the frontline of the distributor.
- The width refers to the number of downlines recruited in the frontline.
- The width of the plan is unlimited and the depth is limited to a certain level for earning the commission.
- Unlike the Binary plan, no spillover in the Unilevel Plan.
- It offers many bonuses like sponsor, fast start, level commissions.
Matrix Compensation Plan
The Matrix MLM Compensation Plan is also referred to as a Forced Matrix Plan. This MLM plan is based on a compensation structure that consists of a certain width and depth. The basic structure of the Matrix compensation plan is identified by the ‘width * depth’ of the matrix.
The distinct feature of a matrix plan is its limited width. Unlike other MLM compensation plans, matrix restricts the number of distributors you can sponsor on your first level, usually to less than five. The most commonly used matrix MLM plans are 4 x 7, 5 x 7, 3 x 9 and 2×12. Like this plan, also the design of Board Matrix is a 2 x 2 Matrix that is also known as 2 x 2 Matrix Cycle Plan.
Matrix Plan is popular for its advanced ability to spillover. This is the unique feature of a matrix plan that will help you to motivate your downline distributors to sponsor more into their downline also and ultimately benefits you.
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Advantages of Matrix Compensation Plan
- Once you have filled your frontline distributors, you can then shift your focus to developing your frontline distributors into leaders.
- Members have the flexibility to adjust their organizations the way they set fit.
Disadvantages of Matrix Compensation Plan
- The width and depth of the plan coupled with the variable pay scale can leave many prospects confused.
- “Width*Depth” is the matrix structure in this plan and so it is called a forced matrix plan.
- The width and depth are limited to the matrix structure. For example 2*2, 3*2 matrices.
- The width refers to the limited number of downlines placed in the frontline.
- Depth refers to a limited number down the levels up to which the distributors can sponsor their downlines.
- This plan offers bonuses like matching, sponsor, position, level.
Comparison Between Unilevel And Matrix MLM Plans
#1. MLM Structure:
Unilevel MLM plan is known as an unlimited width plan whereas Matrix MLM plan is a forced matrix based plan.
#2. MLM Implementation
Unilevel is very easy to implement when compared to matrix plan as it involves only one frontline downline distribution for all the distributors whereas in Matrix plan, the downline distribution based on fixed width*depth.
#3. Downline Distribution
No spillover of downlines in the uni-level plan whereas there is spillover in the Matrix plan based on width and depth parameters.
#4. MLM Bonus
MLM bonuses offered in the Unilevel MLM plan are less when compared to the Matrix MLM plan. Bonuses offered in the Unilevel MLM plan are Sponsor, Fast Start, and Level commission whereas bonuses offered in Matrix plan are sponsor, level, matching, position, forced matrix.
#5. Downline Expansion
The downlines are expanded easily in the Unilevel plan as it is based on only one single frontline distribution downlines whereas the Matrix plan is limited to the width and depth of the plan.
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