To follow up the Ku Klux Klan post, here’s the scary thought:
What if someone were to do for the NM pay plans what Quotesmith.com did for term life insurance rates? Compare the different NM company pay plans so all can see and compare, and THEN buy/join?
Pay plans of NM companies are notoriously complex, in part to keep the information in the hands of the few. Why? Because that way the hidden obstacles can be let out of the bag a little at a time, after the new recruit has gotten started.
This is not a good thing, and not necessary.
Yes, you should only open the kimono a little on that first date, but what’s underneath should be real, not false. Falsies are so last century.
The best pay plan
There are two things for which network marketing companies pay reps:
1. Get customers.
2. Get reps (distributors, business builders, whatever the name), who get more customers and more reps.
Let’s start with ONE: Get customers. (Not recruits – JUST customers – like what you are of AOL or your cable TV service – you buy it, but don’t sell it.) We can call it the Customer Pay Chart (CPC).
Why customers first?
Only 1/100 people want to sell anything.
97-99% of the income of established NM companies like NuSkin, Shaklee, Melaleuca or NSA for example, come from their customer orders. 1-3% come from the recruiting sign-ups. (Dead reps are customers too, that is, those who stick with the product after they quit selling.)
Some NM companies won’t even get onto Customer Pay Chart list because they only pay for recruiting. I.e., they don’t accept customers unless those people also sign up as sales reps (!).
Here’s the question the CPC will answer for anyone whose interested in building up a customer base in the NM business:
1. What do I make as a rep (yes I know, it depends on your level, see below) if I bring in a customer who buys $100 worth of stuff? I refer ONLY to FRONT LINE customers.
What’s the pay for…and how do I get it:
1. One time retail order. They pay you: E.g. $0-50% (if applicable, depending on your level).
(Say Level 1 pay requires $x in business volume; level 2 requires $x+ in business vol; level 3 means $x++ in business volume. “Levels” are positions. We’ll use level numbers like this to avoid confusion with all the different names companies have for them, e.g. diamonds, senior directs, etc.
Use level X, as the very highest pay position possible in any company.)
2. Monthly, or regular (auto-ship/preferred customer order): They pay you 0-50%, depending on your level. Tell how much for each level.
3. Monthly maintenance requirements, if any. How much product do you have to buy yourself each month? Any other minimum volume requirements to get paid the percent on the customer order?
4. Any other obstacles/requirements that you must meet in order to get paid what’s being offered.
5. Other requirements your company has to get paid on customer orders?
If such a CPC is built and published, different people will use it differently, depending on their goals.
Here’s how a CPC would fit into my criteria (and how it did) for the 5 businesses I did:
1. First always, pick the product line you love the most to represent.
2. Second, if that company doesn’t value getting just customers, i.e. they don’t pay for customers, then use their products, and find the next best line of products where the company DOES pay you fairly to bring them customers (minimum 10% of the dollar amount of the order. Else why bother? There are easier ways to make the same money..)
3. Don’t let buy-ins scare you if you’re looking to go fast. When I was building my last company, there was a requirement of $5k to get to the higher pay level (30%). Since I knew I wanted to make it a full time effort, I had no problem doing that, and then finding more reps and customers.
However, if you are making your effort part time, and money is tight, you will want to find a pay plan that has lower buy-ins to get some wholesale benefits. And build up to the higher pay levels over time.
Remember in any sales business, the more you sell, the more you make. So if you’re on the leisure track, the trade off is you’ll earn less of a percent, say 10%, but you also don’t have to do the bigger numbers. Fair trade.
It takes sales to make money in our business. And that is never easy. But given our new recruits know that going in, how do those customer pay plans really stack up?
Submit your company’s info below, using the parameters above. If I can find a reader to help, I’ll eventually publish a usable Customer Pay Chart listing. Fun?
No more secrets. Then you can choose…
What’s the “best pay plan” for me?