The Board MLM (Multi-Level Marketing) plan is a popular compensation structure used in network marketing. It is designed to motivate and incentivize distributors to build a strong organization by promoting product sales and recruiting new members. In this plan, distributors are organized in a board-like structure, where each board consists of a fixed number of positions. As distributors progress and achieve certain milestones, they advance through the boards, earning rewards and commissions along the way.
Overview of the Board MLM Plan
The Board MLM plan is based on the concept of boards, also known as matrices. A board is a fixed-size structure with a predetermined number of positions, typically organized in a binary or matrix format. The number of positions in a board can vary depending on the MLM company, but common board sizes include 2x2, 3x3, 4x4, and 5x5.
Each distributor starts at the initial board, often referred to as the first board or the starter board. The objective is to fill all the positions in the board by recruiting new members and placing them in the available positions. Once all the positions are filled, the distributor advances to the next board, where the process repeats. The progression continues until the distributor reaches the final board, which usually offers the highest rewards and commissions.
Benefits of the Board MLM Plan:
Encourages Teamwork and Collaboration: The board structure encourages teamwork and collaboration among distributors. Since each board requires a certain number of positions to be filled, distributors must work together to support and assist their downline members in filling their positions. This fosters a sense of camaraderie and cooperation within the organization.
Motivates Distributors to Recruit: The Board MLM plan provides strong incentives for distributors to actively recruit new members. Since the number of positions in each board is fixed, distributors need to constantly bring in new recruits to progress to higher boards and earn greater rewards. This helps in expanding the network and increasing sales volume.
Promotes Product Sales: To advance through the boards, distributors not only need to recruit new members but also generate product sales. This ensures that the MLM company's products or services are being promoted and sold effectively. The focus on sales encourages distributors to become effective product advocates and helps drive revenue for the MLM company.
Offers Lucrative Rewards and Commissions: The Board MLM plan typically offers attractive rewards and commissions as distributors advance through the boards. The rewards can include cash bonuses, travel incentives, luxury items, and even leadership positions within the company. This motivates distributors to work hard and achieve their goals, as they can see tangible rewards for their efforts.
Creates a Sense of Progression: The board-based structure provides a clear sense of progression for distributors. As they move from one board to the next, they experience a sense of accomplishment and advancement within the MLM organization. This progression can boost morale and motivate distributors to continue building their network and achieving higher levels of success.
Leverages Spillover Effect: In a board-based MLM plan, distributors often benefit from the spillover effect. Spillover occurs when a distributor's upline fills a position in their board with a new recruit. This can help distributors fill their boards more quickly and advance through the system faster. The spillover effect can be particularly advantageous for new distributors who may not have an extensive network of their own yet.
Potential Drawbacks of the Board MLM Plan:
Focus on Recruitment: The Board MLM plan places significant emphasis on recruitment. Distributors are motivated to recruit new members to fill the positions in their boards, sometimes leading to a stronger focus on recruitment than on product sales. This can result in a heavy emphasis on building the network rather than building a customer base for the MLM company's products.
Limited Income Potential: Although the Board MLM plan offers attractive rewards and commissions, the income potential may be limited for distributors who do not advance to higher boards. Once a distributor reaches the final board, there may be no further boards to progress to, potentially capping their earning potential within the plan.
Complexity and Management: Managing a board-based MLM plan can be complex for both the MLM company and its distributors. With multiple boards and positions to track, it requires robust software and systems to manage the compensation structure effectively. Distributors also need to understand the intricacies of the plan, which can be challenging for new members.
Dependency on Upline Support: Success in a board-based MLM plan often relies on the support and activity of the upline distributors. If a distributor's upline is not actively recruiting or generating sales, it can slow down their progress and limit their potential earnings. Distributors may feel dependent on their upline for advancement and success.
Saturation and Board Splitting: As more distributors join the MLM company, saturation can occur, where boards become difficult to fill due to a lack of available positions. To address this, some MLM companies implement board splitting, where new boards are created when the existing ones are filled. However, this can lead to complexities and dilution of rewards.
Conclusion the Board MLM plan is a compensation structure commonly used in network marketing. It offers several benefits, including teamwork, motivation for recruitment and product sales, lucrative rewards, a sense of progression, and leveraging the spillover effect. However, it is important to be aware of potential drawbacks such as a heavy focus on recruitment, limited income potential, complexity in management, dependency on upline support, and the possibility of saturation and board splitting. MLM companies considering the Board MLM plan should carefully evaluate these factors and consider whether it aligns with their business goals and values. Similarly, individuals interested in joining an MLM opportunity should thoroughly research and understand the compensation plan to make informed decisions about their involvement.