Here's the truth that most MLM companies won't tell you: your compensation plan is the single biggest factor in whether your distributors stay motivated or walk away. Choose wrong, and you'll watch your team crumble. Choose right, and you'll build an unstoppable organization.
After working with hundreds of network marketing companies and analyzing what makes top earners successful, I've identified the five commission structures that consistently produce results. Let me break them down for you.
1. The Binary Plan: Simple, Powerful, and Proven
The binary plan has become the gold standard in modern network marketing, and for good reason. With just two legs (left and right), it's incredibly easy to explain to prospects and even easier to duplicate.
Here's how it works: Every distributor builds two teams. Commissions are calculated based on the weaker leg's volume, which creates a beautiful dynamic—your success is directly tied to helping your weaker side grow.
Why Top Earners Love It:
- Spillover magic: When your upline recruits, those people can land in YOUR organization
- Team synergy: Everyone has a vested interest in helping each other succeed
- Unlimited depth: Get paid on volume no matter how deep it goes
- Easy to explain: "Just build two legs" is a pitch anyone can make
Watch Out For:
- Leg imbalances can leave money on the table
- Requires strategic placement of new recruits
- Some companies cap daily or weekly earnings
Pro Tip: The most successful binary distributors focus on building their weaker leg first. This maximizes commissions and creates true team collaboration.
2. The Unilevel Plan: Width is Wealth
If you're a natural recruiter who can bring in dozens of frontline distributors, the unilevel plan is your ticket to massive passive income.
Unlike the binary, there's no limit to how many people you can personally sponsor. You earn a percentage on multiple levels deep, typically decreasing at each level (e.g., 10% on level 1, 8% on level 2, 5% on level 3, and so on).
Why It Works:
- No placement strategy needed: Just recruit and go
- Rewards personal effort: The more you recruit, the more you earn
- Simple math: Everyone understands percentages
- Great for product-focused companies: Emphasizes customer acquisition
The Reality Check:
- Requires constant personal recruiting to maximize earnings
- Deep levels often require rank qualifications
- Less "team" feel than binary structures
3. The Matrix Plan: Controlled Growth, Guaranteed Spillover
Matrix plans (like 3×9 or 5×7) are the ultimate equalizer in network marketing. Everyone has the same structure, the same potential, and the same opportunity.
When you fill your first level, new recruits automatically spill over to your downline. This means even someone who's terrible at recruiting can still build a team through their upline's efforts.
The Beauty of Forced Matrix:
- Built-in spillover: Help comes from above automatically
- Visual goal setting: "I just need to fill my 3×9 matrix"
- Encourages helping downline: You can't advance until they do
- Fair opportunity: Same structure for everyone
Limitations to Consider:
- Can feel restrictive for power recruiters
- Spillover isn't guaranteed to active positions
- May encourage "waiting for spillover" mentality
4. Stairstep Breakaway: The Classic Wealth Builder
This is the OG of MLM compensation plans—used by companies that have been around for 30+ years. It rewards those who build substantial personal groups that eventually "break away" to become independent organizations.
You climb ranks by hitting sales volumes. When you reach the top rank, your group "breaks away" and you earn override commissions on their entire organization.
Why Veterans Swear By It:
- Massive earning potential: Top earners make seven figures
- True residual income: Breakaway groups keep producing
- Proven track record: Decades of millionaire success stories
- Encourages real business building: Focus on volume, not just recruiting
The Hard Truth:
- Complex to explain to new distributors
- Longer path to significant income
- Can feel competitive rather than collaborative
5. Hybrid Plans: The Best of All Worlds
The smartest MLM companies today are creating hybrid compensation plans that cherry-pick the best elements from each structure. Think binary simplicity + unilevel depth + matrix spillover + breakaway bonuses.
BizBase was built to support any compensation structure—including custom hybrids that match your exact business model.
Popular Hybrid Combinations:
- Binary + Unilevel: Two-leg structure with unlimited unilevel depth bonuses
- Matrix + Matching: Forced matrix with matching bonuses on personally sponsored
- Unilevel + Breakaway: Wide recruiting with volume-based breakaway bonuses
Which Commission Structure is Right for YOU?
There's no one-size-fits-all answer. The right plan depends on:
- Your product price point: High-ticket items often work better with binary or hybrid plans
- Your target distributor: Part-timers prefer simpler structures; full-timers want maximum earning potential
- Your company culture: Collaborative teams thrive in binary; competitive teams excel in unilevel
- Your growth goals: Rapid scaling vs. sustainable long-term building
The Bottom Line
Your compensation plan is more than just how people get paid—it's the DNA of your company culture. It determines behavior, shapes team dynamics, and ultimately decides whether you build a business that lasts.
BizBase supports all five commission structures out of the box, with the flexibility to customize every aspect of your compensation plan. Whether you're starting fresh or migrating from another platform, we've got you covered.
Ready to build your dream compensation plan? Join the BizBase Founders Program and get unlimited access to our powerful commission engine—for one price, forever.