Among the MLM plans, Generation Compensation Plan is given very high importance. As the name suggests, the Generation Plan looks like a family tree – with several generations. The first generation receives the highest commission, and it decreases as the Generation tree grows downline. The plan is also called Gap Commission Plan or Repurchase Plan and is perfect for companies whose goal is to sell products rather than earning recruits. FinoForce has one of the most potent Generation Multi-Level Marketing Software that can keep your members motivated to make more sales with grand bonus schemes.How Does the Generation MLM Plan Works?
Generation MLM Plan works on profit-sharing. Imagine you have an ancestral property owned by your great-grandfather. The property was utilized at its best by your grandfather, then by your father, and now you. By the time it is passed on to you, its value is depreciated. Generation Plan is similar to this concept.
While it varies from company to company, each firm will comprise four to five generations with 10 to 15 downline levels. The first generation will be level one, the levels two and three may form the second generation, and so on. The number of members increases with each generation - the first generation will have 50 members, the second generation would have 150, and the third, 400.
Most FMGC sector companies follow the Generation MLM plan to achieve their goal of selling products faster. To keep the sales going, the companies can launch new products and product lines regularly.How is the Commission Calculated?
The Generation MLM Plan is not compensation or commission-based system. It is more like profit sharing. The company board members decide the revenue sharing percentage for each generation. The first generation earns the highest revenue. The rate is gradually decreased with each generation. For example, the first generation will earn a 10% commission from the profits, the second generation will receive 7.5%, and the third would get 5%. It goes on like this.
However, while the profit-sharing percentage decreases with each generation, the number of members increases simultaneously, providing more income-earning opportunities. Therefore, the MLM company that wants to implement the Generation Plan must have a good advertising and marketing strategy to ensure business success.
On the brighter side, the company gets to save money on advertising, as the members do the promotion themselves. Besides, the advertising cost is shared between the product company and the distributors and downline members. Distributors earn income by selling the products to their downline members. For example, the distributor can buy the product at $4 and sell the product to the downline member at $6, who in turn sells the product to the member below him at $7.Advantages of Generation MLM Plan
The Generation compensation plan offers incredible income opportunities to each member. It not only pays you at different levels but also lets you share the profits. For example, being in the first generation, you will not only earn the highest revenue percent, but as the generation grows, you will make from all the members from your downline. By the time the last generation level is completed, you would probably be earning in millions.
All you have to do is spend some time and money to invest in the plan initially to reap the benefits for years.
- Since the recruiting process is slow, only genuine members who are actually interested in direct selling are added.
- The plan keeps every person active and agile in selling products, regardless of their position in the downline.
- The MLM company will reap benefits from the entire team, enabling them to launch new products and create new marketing ideas.
- The FinoForce ultimate Generation MLM Software can significantly reduce conventional marketing and advertising budget as the plan is entirely driven by direct sales and mouth-to-mouth promotions.
- Even though the commission decreases with each generation, the income will still be good for members of all levels. For instance, while a generation-one member will receive a 10% commission for sales generated by 100 members, a generation-four member will receive a 5% commission for sales generated by 500 members.
- Generation plan is perfect for excellent quality wholesale products.
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