Pick A Compensation Plan That Includes Retail

For Best Cash flow For Everyone

This is how important the right compensation plan is. Product users make up 72 percent of the people who deal with your company - that’s just how it is. Most of these should be retail customers.

Now I know that you are probably not going to charge your Mum and your Granny the retail price but you had better be charging retail to all the other people.

Retail price too high?

Then the company has jacked them up to cover their overheads and told you, ‘just sign them up as distributors’. If you can't find comparable prices elsewhere, the prices are too high.

As a rule, there should be about 25 - 40% markup. Under 25% and there is no incentive to retail - over 40% and the company is setting you up to recruit, recruit, recruit.

Why is recruiting a problem?

Recruiting with no retail means you have all chiefs and no indians. No retail and no volume. Bad for business.

Choose a compensation plan that pays part time people

As many as, 95% of your people will be part time distributors and will want to make some money - maybe only $100 a month - but you had better have a way for them to do that or they will quit and you will have no volume.

You must have training in place for them to be able to find customers who are NOT their family or, again, they will make no money and quit.

Look for a compensation plan that pays the most people

One company claims to have made more millionaires than any other company. True. That’s easy when you don’t pay 99.9% of the distributors - and pay the bonuses to the 0.1% top dogs. In fact most lose money chasing the dream.

A good question is...

How many people will it take in my team for me to earn $10000 a month?

Here is how to use the calculator above work it out.

• Find out how much BV is required to earn $10,000 a month.
• For now, put Zero in the Retail BV box.
• What is the minimum BV to earn a bonus in your comp plan? Place that in the third box.
• Click Calculate

The result is ...

Now assume that each distributor has an average of half a customer each and enter that BV in the Retail box. Why only half? Most of your distributors will be users only. Or beginners.

The ideal is for each distributor to have 10 retail customers - now you can see the importance of that retail business.

Have a play with it

Imagine if you had no retail customers, you would have to find a lot more people. They would not be making any retail. At the bottom they would not be getting any commissions and they would quit and say that it did not work. It was NOT their fault. It is the compensation plan. And you would be chasing your tail finding new people to fill the gaps. Does this sound familiar?

Pick a compensation plan that encourages retail, pays part timers and you get a great income for the least number of people in your group.