Stair Step Breakaway Comp Plan
The stair step breakaway plan has been around for many years and has a proven track record it is commonly implemented by new start up companies however like any other compensation structures it has advantages and disadvantages. But the overall concept is that reps climb the ladder of success and when they reach a certain level they are allowed to break away from their upline and run independently earning greater commissions.
Similar to the Unilevel plan, each rep is only allowed to sponsor frontline with no limit on width this offering limited incentive for teamwork within your organization and the competition between cross line distributors and can make it difficult to recruit close friends and family into this structure.
As distributors breakaway, the original sponsor is still entitled to earn a small percentage from each break away distributors’ efforts. This is referred to as an override commission. Each breakaway organization is referred to as a generation and although distributors are entitled to earn an override commission on all of their breakaway generations, unfortunately this override commission is only a small fraction in comparison to the commissions they were earning before the breakaway.
Disadvantage: although you may have reached the level where you are allowed to break away from you upline, allowing you to earn greater commission, your organization will grow and reps in your downline may also qualify to break away from you. Although initially having a distributor break away from your organization can put a dent in your short-term income, creating a number of breakaway organizations can help you to earn a long term residual income and re-focus your time towards developing a frontline of future leaders. it’s a never ending cycle in my mind.
Advantages: It has a good track record, which makes it attractive to new companies looking for a proven business model.
Who is this plan for? This is best suited for people who are confident in their ability recruiting and have good management skills.