Australian Binary MLM Plan

Key Terms in Australian Binary MLM Plan

• Left Leg and Right Leg: The two sides of a distributor’s network in the binary structure. Each distributor builds and maintains these two legs for commission eligibility.
• 1:2 and 2:1 Matching:Instead of the standard 1:1 match in traditional binary plans, the Australian Binary Plan requires a 1:2 or 2:1 match for commissions, adding a layer of strategic growth to the network.
• Balance: The concept of maintaining equal or proportional sales volume between the left and right legs, often required to maximize earnings.
• Weak Leg: The leg with lower sales volume. Commissions are typically calculated based on the performance of this leg.
• Power Leg: The leg with higher sales volume or growth, typically built with contributions from the upline and team effort.
• Carry Forward (or Roll Over): Unused sales volume from the stronger leg (or both legs) that can be carried forward to future payout periods.
• Binary Cycle: A defined commission period or cycle during which sales volume and balance are calculated for payout.
• Spillover: When a distributor’s upline places new recruits into one of their legs, aiding the distributor in building their network.
• Capping (or Ceiling): The maximum commission or earnings a distributor can receive within a specific period, ensuring system stability.
• Binary Tree: A visual representation of the distributor network in the binary structure, displaying left and right legs.
• Flushing: The process of resetting unused volume if it exceeds the capping limit or isn’t carried forward, depending on the plan’s rules.
• Personal Volume (PV): The sales volume generated directly by a distributor’s own purchases or sales, often a requirement for commission eligibility

How the Plan Works

The Australian Binary Plan is a unique variation of the traditional binary MLM plan. Instead of the standard 1:1 matching (one user on the left leg and one on the right leg), the Australian Binary Plan requires 1:2 or 2:1 matching for pairing. This means that commissions are earned when there is a matching ratio of 1 user on one leg and 2 users on the other leg, or vice versa.

Structure and Recruitment

In the Australian Binary Plan, affiliates still build teams with a left leg and a right leg, just like in a traditional binary plan. However, instead of earning commissions on a 1:1 match (one on each side), the system requires a 1:2 or 2:1 matching structure for commission eligibility.

For example:

• Alice recruits Bob into the left leg and David into the right leg.
• Later, Alice recruits Emma further fill the legs.

 Commission Matching

In a typical binary system, commissions are earned based on a 1:1 match between the left and right legs. However, the Australian Binary Plan requires a 1:2 or 2:1 match to trigger the commission. Here’s how it works:

• 1:2 Match / 2:1 Match: If there is 1 recruit in the left leg and 2 recruits in the right leg, or vice versa, a commission is triggered.

This ensures that the plan accommodates more flexible and scalable team-building strategies, as you do not always need a perfectly balanced structure between the left and right legs

Spillover Effect

As with most MLM plans, spillover occurs when a sponsor recruits more members than needed for their immediate structure. The excess members are automatically placed into the downline of existing affiliates, helping them grow faster.

For example:

• Alice recruits more members than required to complete her 1:2 matching on her left and right legs.
• These extra members spill over to Bob or David, benefiting them by filling their own downline quickly.

This spillover effect helps affiliates grow their teams, even if they’re not personally responsible for recruiting every individual in their downline.

Carry Forward Volume

In the Australian Binary Plan, unused volume in one leg (either the left leg or the right leg) is carried forward to the next cycle. This ensures that no volume is wasted, and affiliates can continue to earn from their growing network.

For example:

• If Alice’s left leg is stronger than the right leg and has extra volume (more recruits or sales), this unused volume will be carried forward to the next cycle.
• This volume will help Alice earn commissions on her next matching cycle.

Carrying forward the volume helps balance out the network and ensures that affiliates earn from every effort, even if there are temporary imbalances between legs.

Commission Example with Users

Let’s put everything together with a scenario:

• Alice recruits Bob into the left leg and David into the right leg.
• Bob recruits Emily and Jack, 
• Alice brings another member Emma creating a 1:2 match(1 in the left leg, 2 in the right leg).
• Alice earns a commission for this 1:2 match.

In this example, Alice can earn commissions based on both 1:2 and 2:1 matches, which allows for more earning potential as compared to traditional binary plans.

Summary of Key Features

• 1:2 and 2:1 Matching: Commissions are triggered when there is a 1:2 or 2:1 match between the left and right legs.
• Spillover: Extra recruits from the sponsor spill over to the downline, helping affiliates grow their teams faster.
• Carry Forward Volume: Any unused volume in one leg is carried forward to the next cycle to ensure continued earnings.

Difference Between Tri-Binary and Australian Binary MLM Plans

While the Tri-Binary Plan and the Australian Binary Plan may seem similar at first glance, they have notable differences. The key distinction lies in the requirement for pair matching. In a Tri-Binary plan, pair matching is essential, whereas the Australian Binary Plan does not require any matching.

One of the main advantages of the Australian Binary Plan is its faster bonus formation compared to other plans. Payouts in this plan increase directly with the number of pairs, and it is not limited by levels. This simplicity and efficiency make the Australian Binary Plan highly beneficial for both companies and participants.

It is often considered one of the best compensation models for customers due to its ease of use and higher payout potential. Unlike traditional binary plans, the Australian Binary Plan eliminates the requirement for compulsory matching, making it simpler and more appealing.

A reliable MLM software system is crucial for the success of any MLM strategy. Modern MLM software solutions are highly efficient and support a variety of plans, including Binary, Hybrid, Matrix, Uni-level, and Stair-step Breakaway. These features ensure

How the Team Build in Australian Binary Plan

• Referring Own Users: As a distributor, you start by recruiting your own direct members, placing them into your left leg and right leg. These are your personal recruits, and their sales volume will directly contribute to the overall performance of your network. If a position in either leg is already filled, the new recruit will spill over into your downline, helping to grow your network with minimal effort.
• Users You Referred Refer New Users: After recruiting your initial members, these individuals can also begin to recruit new users of their own. These recruits are placed in the left or right leg of your team, depending on how the network grows. As your downline recruits new members, the network continues to expand. You earn commissions based on the sales and placement of these new recruits, especially when they are placed in the weaker leg.
• User Comes as Spillover: Spillover occurs when someone higher up in the network (your upline) has already filled both their left and right legs and is unable to place new recruits directly under them. When this happens, the upline places new recruits into the downline’s available positions. These spillover members are placed under your left or right leg, often in your weaker leg, which helps to balance your network and contribute to your growth. Even though these recruits are not directly referred by you, you still benefit from their sales volume, particularly if they are placed in the weaker leg.

How Positions Filled in Australian Binary

In the Australian Binary MLM Plan, when a distributor decides to place a new recruit in either the left or right leg, and the direct position in that leg is already filled, there may be existing teams under the already occupied positions. In this case, the following rules determine where to place the new recruit within the distributor’s tree.

• Left to Right: If the distributor’s chosen leg (left or right) is already filled, the system will look for the next available position under the already occupied position. The new recruit will be placed in the next available spot sequentially from left to right down the tree, filling any open position that exists under the original placement. This ensures that the spillover will not go to a particular user but will be assigned evenly across available spots in the tree.
• Left Most/Right Most: If the chosen leg is filled and there are multiple levels in the tree under the already occupied position, the system will look for the leftmost or rightmost vacant position in that leg. The recruit will be placed in the outermost available position, either on the leftmost or rightmost side of the tree. By doing this, only one leg will be filled by this spillover to the downline, while the other leg should be managed by the distributor and their recruits.

These rules help ensure that positions are filled efficiently, even when a distributor’s chosen leg is already occupied. The key principle is to maintain balanced growth by filling positions in the most effective way possible, ensuring that the binary structure remains organized and conducive to the expansion of the network.

How to Decide Position of a New User

• Using Separate Referral Links: In this method, there are two separate referral links—one for the left leg and one for the right leg. The new recruit will be placed in the leg corresponding to the link they use to sign up. If the new user uses the referral link for the left leg, they will be placed in the left leg, and if they use the referral link for the right leg, they will be placed in the right leg. This method ensures that the position of the new recruit is determined based on the referral link chosen by the sponsor or the recruit.
• Using a Holding Tank: The new recruit will be placed in a holding tank, where they remain temporarily before being assigned to the binary tree. The sponsor can manually assign the recruit to either the left or right leg after evaluating which leg is weaker. This allows the sponsor to make a strategic decision based on the current structure of the network. If the sponsor does not manually assign the position, the system will automatically place the new user based on the sponsor’s default placement option.
• Setting a Default Option in Profile (Binary Default Position): Sponsors can set a default position for new recruits within their profile. This option, named “Binary Default Position,” includes settings such as “Right,” “Left,” “Balanced,” or “Alternative.” Once the default position is set, the system will automatically place any new recruits based on the chosen option. This allows for consistent and automated placement, minimizing manual intervention.

These three methods provide different ways to decide the position of new recruits within the Binary MLM Plan, giving both sponsors and the system the ability to manage team structure effectively.

Now, let’s consider how commissions work

Refereal Commission

In the MLM plan, Referral Commission is earned by a distributor when they personally refer or recruit new members into the network. The distributor earns a one-time commission based on the enrollment or purchase made by the new recruit. This type of commission rewards distributors for bringing in new customers or team members.

How it Works

• When a distributor recruits a new member, they earn a commission based on the new recruit’s enrollment fee, product purchase, or initial investment. This commission is often a percentage of the recruit’s first purchase or enrollment.
• Referral commissions are typically paid once, at the time of the new recruit’s sign-up or purchase.

Referral Commission Amount

• Referral Commissions can vary depending on the company’s compensation structure. They are usually a fixed percentage of the new recruit’s initial purchase amount or a flat fee.
• The amount may differ based on the product or service sold, the new recruit’s package, or other factors defined by the company.

Example

• Example 1: Alice recruits Bob, and Bob pays a $100 enrollment fee. Alice earns a Referral Commission of $20 (20% of Bob’s fee) as a reward for bringing him into the system.
•  Example 2: If Alice recruits David, who buys a product worth $500, Alice might earn a Referral Commission of $50 (10% of David’s product purchase).

Purpose

• Referral Commissions are designed to incentivize distributors to actively recruit new members into the network. This commission type rewards distributors for their efforts in expanding the network, which is the foundation of the MLM business model.
• These commissions encourage active recruitment and help distributors see immediate rewards from their recruiting efforts, motivating them to continue building their network and increasing their earning potential.

Sponsor Based Level Commision

Even if the structure follows a binary tree, the sponsor-based unilevel structure is maintained for commission distribution. Sponsor-Based Level Commission is optional and not a compulsory component of every Australian binary MLM plan. This ensures that distributors are rewarded for the sales volume or commissions generated by their direct recruits and the subsequent levels of their downline. This approach aligns commissions directly with the sponsor tree rather than the binary placement.

How it Works

• Direct Recruit Earnings: When a distributor recruits a new member (direct recruit), they earn a percentage of the sales or commissions generated by that recruit.

• Earnings from Downline Levels: Distributors also earn commissions from the sales made by the recruits of their direct recruits, forming a multi-level structure. The commission percentage typically decreases as the levels go deeper.

• Sponsor Tree Basis: Despite the use of a binary tree for organizational purposes, Sponsor-Based Level Commissions are calculated based on the sponsor tree, which is directly linked to who recruits whom.

Sponsor-Based Level Commission Amount

• Percentage Allocation: Commissions are paid based on a fixed percentage or a flat amount of the sales or commissions generated by direct recruits and their downline members. These percentages or flat amounts generally decrease as the levels increase.

Example Percentages:

• Level 1 (Direct Recruits): 10% or a flat $100
• Level 2 (Recruits of Direct Recruits): 5% or a flat $50
• Level 3 (Third Level Downline): 3% or a flat $30

Example

Example 1:

• Alice recruits Bob, who generates $1,000 in sales.
• Alice earns 10% of Bob’s sales = $100.

Example 2:

• Bob recruits Emily, who generates $500 in sales.
• Alice earns 5% of Carol’s sales = $25.

Example 3:

• Carol recruits Dave, who generates $300 in sales.
• Alice earns 3% of Dave’s sales = $9.

Purpose

Sponsor-Based Level Commissions are designed to:

• Reward distributors for recruiting and mentoring new members.
• Encourage sponsors to actively support their downline.
• Promote the overall success and growth of the team.

Australian Binary Commision

In the Australian Binary MLM Plan, commissions are earned in a similar structure to the Binary Plan, with distributors building two legs—left leg and right leg. However, unlike the Binary Plan, the Australian Binary Plan allows for matching ratios like 1:2 or 2:1, making it easier to qualify for payouts.

How It Works

Distributors earn Australian Binary Commissions based on the sales volume generated in their network. While traditional binary plans require strict 1:1 matching between legs, the Australian Binary Plan allows matching in ratios such as 1:2 or 2:1.

For example:

• If one leg generates $1,000 in sales and the other generates $2,000, the distributor qualifies for commission based on the total eligible pair (1:2).
• There is no remaining unmatched sales volume; commissions are based strictly on the eligible matching pairs.

This ensures distributors can earn commissions faster, even if their legs are not perfectly balanced.

Australian Binary Commission Amount

Australian Binary Commissions are typically paid as a percentage of the total sales volume from the matched pairs, regardless of the matching ratio (1:1, 1:2, or 2:1). For example:

• A distributor might earn 10% of the sales volume from the matched pairs.

Alternatively, some companies calculate commissions based on individual sales count, offering a fixed payout for each matched sale, further simplifying the process.

Example

• Example 1 (1:2 Matching):

Alice’s left leg generates $1,000 in sales, and her right leg generates $2,000. With a 1:2 matching ratio, Alice qualifies for commission on $1,000 from her left leg and $2,000 from her right leg (1:2 pair). At a 10% commission rate, Alice earns $100 (10% of $1,000 from the weaker leg).

• Example 2 (2:1 Matching):

Alice’s left leg generates $2,000 in sales, and her right leg generates $1,000. With a 2:1 matching ratio, Alice qualifies for commission on $2,000 from her left leg and $1,000 from her right leg (2:1 pair). At a 10% commission rate, Alice earns $100 (10% of $1,000 from the weaker leg).

Purpose

The Australian Binary Plan is designed to encourage network growth while simplifying the payout structure. By allowing 1:2 or 2:1 matching ratios, it provides greater ease for distributors to earn commissions, even if their network is slightly unbalanced.

This approach rewards distributors for overall performance and network expansion, eliminating the strict requirements of traditional binary plans. Over time, this system can generate consistent passive income as the network grows, creating a fair and efficient compensation model.

With its streamlined process and faster payouts, the Australian Binary Plan is an excellent choice for companies and distributors looking for a simplified yet rewarding MLM structure.

Matching Bonus

In the Australian Binary MLM Plan, the Matching Bonus is earned based on the binary commissions earned by a distributor’s downline. The sponsor or upline distributor can earn a percentage of the binary commissions earned by their direct recruits and, in some cases, even their indirect recruits, depending on the compensation structure.

How it Works

• When Alice’s recruits (such as Bob and David) earn binary commissions from their network sales, Alice can earn a Matching Bonus based on the binary commissions earned by Bob and David.
• The Matching Bonus is distributed to the upline based on the sponsor-based tree, meaning the bonus is allocated according to the sponsor relationships, not the binary leg structure.

Matching Bonus Amount

• The Matching Bonus is often a percentage (e.g., 5% to 20%) of the binary commissions earned by Alice’s direct recruits (and, in some cases, up to several levels of indirect recruits).
• The bonus structure can vary, with some companies offering higher matching percentages for direct recruits and lower for those further down the sponsor tree

Example

Example 1:

• Alice recruits Bob, and Bob earns $200 in binary commissions from his network.
• Alice, being Bob’s sponsor, receives a Matching Bonus of $20 (10% of Bob’s binary earnings).

Example 2:

• Alice also earns a matching bonus from the second level, where Bob recruits Emily, and Jack earns $100 in binary commissions.
• Alice might earn a smaller matching bonus, say 5%, from Jack’s earnings, which would be $5.

Purpose

• Matching Bonuses are intended to incentivize sponsors to help their downline succeed and grow. By rewarding sponsors with a percentage of their downline’s binary earnings, this bonus encourages sponsors to actively support and mentor their recruits.
• This type of bonus fosters a collaborative environment where both the sponsor and the recruit benefit from the success of the downline, promoting teamwork and network growth within the Australian Binary MLM Plan.
• The Matching Bonus is distributed to uplines based on the sponsor tree, ensuring that rewards flow through the sponsor relationships.

Rank/Rank Advancement Bonus

A rank in an MLM plan refers to the distributor’s level or position within the network based on their performance, such as sales volume, recruitment, or the number of people they’ve sponsored. Rank advancement may also consider the weaker leg volume, where a distributor’s progress to higher ranks is influenced by the sales volume generated in the weaker leg of their binary structure. As distributors meet specific criteria (like sales, recruitment, or weaker leg volume), they advance through different ranks, such as Associate, Manager, Director, or Executive

Rank Advancement Bonus Amount

The Rank Advancement Bonus is a commission or reward given to a distributor when they achieve a new rank within the MLM structure. This bonus is designed to motivate distributors to work harder to progress through the ranks, often rewarding them with a one-time bonus or a percentage of sales once they hit a new rank. In many cases, rank advancement is influenced by the volume in the distributor’s weaker leg, encouraging balanced team growth.

Example

Let’s say Alice is a distributor who joins the Australian Binary MLM Plan. She builds her network by recruiting Bob and David, placing Bob in her left leg and David in her right leg.

• Level 1: Bob (left leg) and David (right leg) are Alice’s two direct recruits.
• Level 2: Bob recruits Emily and Jack. David is Emily in Bob’s left leg, and Jack is placed in Bob’s right leg. Similarly, David recruits Fay and Gina, placing Fay in his left leg and Gina in his right leg.
• Level 3: If Emily recruits Emma and Igor, they will be placed in Emily’s left and right legs respectively, forming part of Alice’s Level 3 in her binary network.

As Alice advances through the ranks, the weaker leg volume also becomes a factor in her rank progression:

• Alice achieves the rank of Manager after meeting the required sales, recruitment targets, and the sales volume generated in her weaker leg. Alice’s weaker leg could be the right leg (with Davids’s recruits), and after meeting the volume threshold, she earns her Rank Advancement Bonus of $500 as a reward for reaching this milestone.

Purpose

The Rank Advancement Bonus encourages distributors to strive for higher achievements and develop their network. By rewarding distributors for reaching higher ranks, it promotes long-term commitment, motivates performance, and fosters a sense of accomplishment. Including the weaker leg volume in rank determination further ensures that distributors focus on balancing their network for sustained growth.

Methods to Prevent over payment

As explained above, Australian binary mlm plan have their own advantages. However, one drawback is that, once the team is built, even if the customer is inactive, there are still possibilities to earn. In a very deep tree structure, since the company must pay many users, there is a chance for overpayments. To prevent such overpayments, the following techniques are used in the binary system.

• Capping/Ceiling : Capping involves setting limits on earnings, such as weekly, monthly, or other time-based caps, so that distributors cannot earn beyond a specified threshold. These caps can be user-based and customized according to factors such as rank, package, or other criteria. For example, higher-ranking distributors may have higher capping limits, or different package levels may come with varying earning potentials.
• Minimum Activity Requirement : Even when a team is built, a minimum self-purchase requirement can be set, meaning the distributor must make a minimum purchase to remain eligible to earn commissions. This ensures that the distributor remains active and maintains a certain level of activity within the system before they can receive earnings.
• Minimum Direct Referral Requirement : Due to the spillover effect, where the tree can extend automatically, setting a minimum number of direct referrals is necessary for a distributor to qualify for earning commissions. This ensures that distributors are actively building their own network and not solely relying on spillover from upline members.