MLM Generation Plan Overview : What Is It Exactly?
What is a Generation Plan in MLM?
A Generation Plan is a well-structured organizational framework commonly used by Multilevel Marketing (MLM) companies. It is one of the most popular marketing compensation plans, designed to streamline operations and track the incomes and expenditures of downline members effectively. By automating tasks, it significantly reduces the manual workload of MLM companies, enhancing efficiency.
This plan is highly favored by businesses, part-time professionals, network marketers, and individuals looking to establish or grow an MLM business. One of its core principles is simplicity—each member is required to add only two forefront members, forming a binary structure.
The structure’s exponential growth potential makes it a powerful tool for businesses, enabling faster expansion and increased earnings in a short period. This feature has made the Generation Plan a go-to choice for those seeking a systematic and scalable MLM solution.
How Does Generation MLM Plan Work?
In Generation Compensation Plan one member can recruit two people to the first level. This means that the sponsor can make only two distributors underneath, i.e. Left Leg and Right Leg. It is also referred as Power Leg and Profit Leg. If member sponsors more than two new members, excess members are placed at down line below the sponsoring member’s forefront. This ‘spill over’ is an attractive feature that appeals new members, since they only need to sponsor two members to participate in the Generation compensation plan.
That is why it is often termed as Generation Spill over MLM Plan. Earnings in Generation plan is always calculated on matching volume of sales done from both legs. And unmatched business volume gets carry forward for next payout. Matching volume may vary such as 1:1, 1:2, or 2:1. MLM Generation Plan software can also be combined with Level or Forced Matrix that results in hybrid software MLM plan.
Commission Calculation Example
For income calculation, we divide this tree in two parts as Left and Right.
For A Matching Volume is Rs.1500 and the remaining Rs.500 will be carry forward. Income for A will be 5% of Rs.1500 Rs. 75.
For B matching volume is Rs.500. income for B will be 5% of Rs.500 that’s rs.25
For B matching volume is Rs.500. income for B will be 5% of Rs.500 that’s rs.25
Generation / Stairstep Plan Income Types
Quick Start Bonus
In this model, profit is generated by recruiting new members into a downline. For every direct referral, the recruiter earns a referral bonus, which is calculated as a percentage of the current amount or package value.
Performance Bonus
The member is paid a percentage of the group volume of each breakaway below the downline to a decided number of generation. On successful completion of the level, the company sets certain percentage of amount for each members of the genealogical tree.
Director Bonus
The member is paid a percentage of the group volume of each breakaway below the downline to a decided number of generation. On successful completion of the level, the company sets certain percentage of amount for each members of the genealogical tree.
Travel Bonus
This is given to the person after completing the specific tasks that is positive for the development of the company. When members achieve set target within the pre- set time, they get reward bonus.
Generation Plan MLM Software Features
Awapal is a trusted and certified software development company, proudly recognized as an MSME and ISO-certified organization. Specializing in MLM solutions, Awapal offers custom-made MLM software tailored to suit all types of MLM business plans.
With advanced features and a user-friendly interface, Awapal’s MLM software is designed to streamline operations, enhance productivity, and drive business growth.
Digital
eWallets
Auto Closing & Payouts
Advance Genealogy Tree
Pre-integrated Payment Gateways
Online AML &
KYC
Points to Consider About Generation Plan
- Each member can have two front-line distributors (legs) directly under him.
- The balance between these two legs holds great importance that also affects the results while members try to earn largest income.
- Generation Spill over are appealing and play a crucial role in building the income of members.
- With each of the newly added member, all the members in the up line avail some amount of monetary benefits.
- The focus of each member is on the profit leg as the income is more dependent on this leg. And with members from spill overs being placed in the power leg.
- The plan depends on team effort. With sales from up line members offering some benefits to the downline members, differentiates it from other MLM programs.
- This MLM plan supports unlimited depth while the width remains constant. The plan focuses on matching business volume while allowing the network to grow on an infinite level.
- Compensation given to the members depends on the ratio of sales between two legs established in the network directly under a member. This increases the importance of maintaining balance between the legs.
- Compensation given to the members depends on the ratio of sales between two legs established in the network directly under a member. This increases the importance of maintaining balance between the legs.
- In fact, some of the companies may carry forward their extra sales to the next commission duration. In order to increase the stability in the Generation chain system, such companies may limit the payout to a capping limits.
- On applying condition on Generation plan, a 3rd sub-node is formed. For this, no matching pair is needed for compensation. This is referred as Conditional or Australian Generation Software Plan.
