The MLM Generation plan is based on profit sharing. Also called Gap Commission Plan, it works purely based on product selling and is tailor-made for companies that manufacture and sell consumable items. Every affiliate prompts their downline to generate more sales of products and they will be paid bonuses and incentives in return. As the referral system keeps improving and increasing, the member network will also increase. When a distributor sells a product, the volume is to be distributed towards up-lines, hence the name, Generation Plan.
The generation plan's compensation and bonuses differ depending on the MLM company. The following are the most common types of bonuses awarded in the plan:
This is an encouraging bonus since sponsors offer these types of bonuses to urge members to participate in regular network expansion.
It's the commission you make as a percentage of every member who joins through your downlines.
Existing members are eligible for this reward when they progress to a higher level or rank.
This plan is structured in such a way to keep every distributor encouraged in product sales, irrespective of their rank.
Members would mostly be experienced in sales, so the company can regularly introduce new products.
Most of the advertising of the network is done through word-of-mouth, eliminating the need for an elaborate advertising budget.