Common mistakes when calculating the bonus plan
Posted: Mon Apr 21, 2025 5:28 am
At first glance, calculating a marketing plan may seem like a simple task: you just need to determine the percentage of return to the network and distribute bonuses for activity. However, in reality, everything is not so simple and many entrepreneurs make typical mistakes when creating a compensation plan for their MLM company. Among such mistakes:
Incorrect bonus ratio
Trying to combine as many different bonuses as possible, entrepreneurs forex data very often create an MLM marketing plan in which several bonuses are paid for the same activity, for example, for personal sales. In this case, distributors focus only on sales, ignoring the development of a partner network - an important component of MLM business growth.
A similar imbalance also occurs when bonuses are incorrectly distributed between different levels of the structure. For example, a company allocates 50% of the total sales income to partner payments, of which 30% is given to newcomers to show the prospects for earnings at the start. Then very little is left for payments to experienced distributors and MLM leaders, their motivation will fade and they will easily move to another company.
Any imbalance in the reward system creates a sense of unfairness among partners, undermines trust in the company and negatively affects the stability and productivity of the network structure.
Incorrect bonus ratio
Trying to combine as many different bonuses as possible, entrepreneurs forex data very often create an MLM marketing plan in which several bonuses are paid for the same activity, for example, for personal sales. In this case, distributors focus only on sales, ignoring the development of a partner network - an important component of MLM business growth.
A similar imbalance also occurs when bonuses are incorrectly distributed between different levels of the structure. For example, a company allocates 50% of the total sales income to partner payments, of which 30% is given to newcomers to show the prospects for earnings at the start. Then very little is left for payments to experienced distributors and MLM leaders, their motivation will fade and they will easily move to another company.
Any imbalance in the reward system creates a sense of unfairness among partners, undermines trust in the company and negatively affects the stability and productivity of the network structure.