There are many factors that contribute to the success of a MLM company; a good compensation plan is of utmost importance. A company with a compensation plan that fails to motivate its distributors can hinders a company growth.

If that is so, then what is the best compensation plan available? There may be many companies that are very successful but unfortunately, there is no perfect plan, but there are some proven characteristics of some successful plans.

1. Able to attract as many participants as possible.

New recruits must easily see the money in the plan to attract them into the business in addition to anything else. This can be done by placing incentives on getting new participants. Early rewards should be built into the plan especially for the new recruit as most new recruits lost interest in their first 60 days because they simply lose confidence in succeeding long term.

Rewarding them as early as possible keeps their interest and excitement. As they reach their initial goal, it builds up confidence that they can achieve their future dreams which builds the initial skills required to eventually succeed.

2. Retain the highest number of distributors as possible.

As a distributor begin to recruit others and work the plan, they are building an ‘equity investment’ in their downline network. They will continue to build the business if the people in their network continue to work and build the business. Distributors who build an organization network are far more likely to continue to be active than those who do not.

Most companies now use “Auto Ship” programs to build repeat business. This will help to retain people by helping them to receive significant reward for the repeat sales so that they will have the time and attention with their new recruits and help them with their new found opportunities, making it worth their while to make their decision and to get started.

3. Make the highest percentage amount from the products at the earliest point of time, preferably within the first month.

Have a motivating wholesale/retail commission. Fast start bonus are gaining popularity as the first month sales are normally paid mostly to the person who signs up a new recruit with auto-ship. Have reasonable product retail price for the distributors to sell it to end consumers. Do not inflate the price of the products in order to give more incentive to the distributors as it can be difficult for them to retail the products.

Retailing products based on the hope of future rewards will never result in movement of product to retail consumers. Companies that do this always fail. Proper retailing moves the product from distributor to end user in volumes justified by natural consumption.

4. Low monthly maintenance.

Incentives must exist to motivate and reward distributors who build the business. High monthly maintenance can suppress a distributor performance to build depth as he is needed to maintain his own sales or the sales of his personal groups. Unilevel plans tend to have omitted this heavy maintenance.

Low monthly maintenance provides incentives which reward those who build depth. Remember, you want to build leaders not sales people. A good plan will become successful if everyone just buys every month for their own consumption rather then just a handful of super sales people.

5. Encourage team depth building.

Build depth provides stability and long term residual income otherwise the distributors will not be able to stay long in the organization. Building depth also encourages people to train others to recruit and duplicate the same process. Successful distributors learn and use the power of duplication.

Plans that encourage building depth rather than building wide are getting very common. Incentives are placed on group activities, Group Volume incentives usually rewards the whole line rather than rewarding an individual as in building wide.

6. Create strong desire to share the program with others.

A reasonable percentages compensation plan pay-outs. Plans of 40% to 50% of a real dollar value (difference between the point use to calculate the plan and the price of products) usually develop compelling urge to share the plan with others. Company paying less will have a hard time recruiting and keeping distributors for this is a competitive weakness present in their plan.

Many plans are designed by MLM professionals and are too complicated for an ordinary person to understand and to explain it to others. Plans should be simple and easy to be explained as people can understand and learn them quickly to make their first recruits. The more complex the plan, the fewer people it will motivate. The plan needs to excite a distributor first, before it can make him move.

“The secret of success is sincerity. Once you can fake that you’ve got it made.” – Jean Giraudoux, French diplomat, dramatist, & novelist (1882 – 1944)

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For the last 30 years, the U.S. has gone through a recession once every decade. There’s no indication that this will change in the future. Burying your head in the sand will certainly spell disaster for your business. Gritting your teeth to weather the storm will only increase your blood pressure and keep you up at night.

The good news is that a recession is not a depression. It’s unlikely that we will ever go through something like the Great Depression again. However, it’s quite possible that this will not be our last recession. To be successful, you need to become informed about what a recession is and what steps you can take to thrive in the midst of one.

Jack Canfield, too, knows about decisive action. He’s famous for his rags-to-riches story of how he committed to contacting five people a day to promote his book, Chicken Soup for the Soul. The key to his success was his commitment to action. Not just any old action, mind you. Aligned, well-thought-out, purposeful action. Jack knew he had a monumental task in front of him: promoting an unknown book by an unknown author. Each day he took action to increase name recognition, forge connections, and build sales.

Five Simple Steps for Thriving through a Recession, Jack Canfield Style

1. Get back to basics
2. Clean up your act
3. Focus on your connections and relationships
4. Be smart with your money
5. Step back

Continue reading the full article ….

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Just how nasty do you think this recession is it going to be? Economists thought that this downturn may not be worse than the 1990-91 recession which lasted eight months, with back-to-back quarters of negative GDP growth of 2.9 percent and 2 percent.

Unemployment rose from 5.2 percent to 7.8 percent. But now it looks as if the 1981-82 downturn is the better comparison which lasted 16 months, had several quarters where the economy shrank 3 percent more, and unemployment rise as high as 10.8 percent. So what about this recession of 2008-2009?

There have been two quarters so far during the recession where the economy has gotten smaller, each time by less than 1 percent. Those days are over, currently forecasting a 4 percent decline in real GDP in the fourth quarter, placing it among the worst quarters for economic growth in the postwar period. The first three months of next year could be just as bad. And even once the economy begins to grow again, the overhang from the credit crisis will probably crimp significant growth until 2010.

The unemployment rate is ramping up sharply, and households are seeing their net financial worth evaporate before their eyes on a daily basis. Economists say that an 8 percent unemployment rate is likely and 10 percent is not out of the question. Even worse, with more people without jobs will make it that much tougher for the housing market to rebound anytime soon.

Since the housing bubble started to unravel, credit card companies have been cutting credit limits and, in some cases, raising interest rates, partly because they fear more consumers will default as financial stress spreads.

Home prices nationally have already fallen more than 20 percent from their 2006 peak, and in certain boom-and-bust states the declines have been even more precipitous. So if you’ve got a stable job, good credit, a down payment, and a strong stomach, there are certainly buying opportunities out there for you.

Unlike in the housing-boom days, borrowers will have to be able to make a sizable down payment to qualify for the lowest mortgage interest rates. So if you’re looking to go bargain hunting in real estate, begin setting aside a little bit of cash each paycheck to put toward a down payment. When you begin to feel better about your job security, you’ll be ready to take the plunge.

From credit cards to clothes, companies are open to making deals as they struggle to keep customers making it more apt to negotiate your rate because they don’t want to lose you. At the markets you can get discount which can lead to a lower price and savings. Paying with cash increases the chances of making a deal because it allows retailers to avoid credit card transaction fees.

It is a time to stop surviving and shift to thriving because you can almost get deals everywhere. It’s an ill wind that doesn’t blow some good, and you need to make the most of the opportunities that are out there.

“It’s a recession when your neighbor loses his job; it’s a depression when you lose yours.” – Harry S Truman 33rd president of US (1884 -1972)

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