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Binary Plan Disadvantages

Part One, we talked about the advantages of the binary plan. In this post, we’re going to talk about some of disadvantages of the binary. Alright, we’ve already covered how the binary is great for team-building, and also easy to understand. Another good thing (which I really didn’t talk about last time) is how the binary can generate some large checks if you are serious about building your MLM. It’s fair and pays out well.

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Of course there are pros and cons to about everything, so here are some of the disadvantages of the plan.

To begin with, you’ve got to keep your legs balanced because you only get paid on your weakest leg. If you have more people on one side than the other (which almost always is the case), you’re only going to get paid out on the weakest side. Spillover, which is one of the things that everyone thinks is so great about the binary, really won’t help you in this regard because unless you’re actively recruiting and building your weakest leg, you’re not going to really get any benefit from the spillover that you’re receiving from your upline.

Likewise, if you happen to be stuck on the inside of a leg, you’re not going to see any spillover and this can be pretty discouraging – especially for those who are new to MLM.  They will hear about how others who are positioned in the outside leg (especially if it’s a powerleg) bragging about how fast their downline is growing due to spillover.

Occasionally, you’ll find a binary that’s poorly designed and this can result in a plan that actually pays out too much and can result in the company having to cap or reign in the compensation to keep the company from going broke. This isn’t really a criticsm of the binary, as any plan can have this problem, but since the binary calculations get a little tricky, especially on the deeper levels, it’s important that you know your company has pros at the helm who really know what they are doing when it comes to designing the compensation plan.

Is the Binary a good plan? Yes, it’s a solid plan and personally it’s one of my favorite compensation plans.

Here’s part two of Daren Falter’s presentation on the binary plan.

What do you think of the binary? Please leave me a comment and let me know!

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