Stairstep BreakawayPlan Review
Do yourself a favor; you need to seek out third party information, facts, and resources that deal with exactly what it is going to take to be successful in this industry first, before you make a decision about any company or an investment in any business opportunity or Stairstep Breakaway Plan.
Be Sure and check out the Bonus Video that goes with this article by clicking the following link: Stairstep Breakaway Video
So… you are going to invest yourself, your time, energy, dreams, and resources into building a business. If as new distributors you better understand the dynamics of the pay plan you will be considering, then you’ll be better able to choose the right opportunity and business to invest your lives in.
It has become increasingly clear to me that Mlm Compensation Plans should be subjected to the same evaluation process that any Mlm opportunity, its leadership, products, and marketing system go through before you make a decision about joining.
While the pay plan is clearly important, it is only one part of any MLM opportunity. It is your duty to look at the whole package, including but not limited to: Pay Plan, Products, Automated Tools, Market Size, Leadership, Start-Up Costs, Mentorship, and your personal level of Skill and Preparedness.
Are Stairstep Breakaway Plans proven and sound?
Variations of the ”Stair Step” have been used for over fifty years. This was the original compensation plan that started it all and is still being used today. Without a doubt the Stairstep breakaway plan remains the most tried-and-true type of plan out there and with the success of mega-superstar companies like Amway, they are most likely to survive in the decades to come.
The Stairstep Breakaway may well be the best known and demonstrated of the five basic compensation plans. It was declared legal because of Amway fighting a great legal battle for it, as a result it got copied more and more in the industry through the years. Like all good surviving plans in the industry it has undergone advancement and evolution throughout its career to become one of the most tried and true plans out there to date.
However, just like all compensation structures there are some advantages to this compensation structure, and there are also a number of disadvantages. Its’ longevity does not necessarily make it the one size fits all solution for every marketer out there.
Are Stairstep Breakaway Plans a Pyramid Scheme?
Pyramid Schemes are illegal enterprises. Some Mlm Pay Structures may look like a pyramid when they are filled up, but with legitimate pay plans the similarity ends right there.
You see, the Stairstep Breakaway plan is not set up to be a recruiting game where people are only joining for the opportunity to make a lucrative payout. The people joining a Mlm pay plan have to be joining not for the reason to just make money by recruiting distributors into their group. That would be a pyramid scheme and that’s strictly illegal.
An easy way to spot a pyramid scheme is there is no legitimate product or service for sale. Another clue is there is no payout unless you successfully recruit a number of people into the pyramid. You’re paid on enrollee’s and generally there is no selling or marketing of any products or services necessary to receive payment.
The basic concepts of Stairstep BreakawayPlans include:
- In a Stairstep Breakaway Plan, distributors climb the ladder of success (or steps) and when they reach a certain level of accomplishment, they are allowed to break away from their main upline and run their organization independently. The original upline sponsor receives a percentage override on the sales of the entire breakaway, but it will be significantly reduced.
- As distributors break away from their upline it allows them to earn progressively greater commissions.
- Each distributor is allowed to sponsor one level of “frontline” distributors and limited depth (levels) depending upon the amount the company can afford to pay out. There is no limit to the width (number of frontline distributors) you can sponsor and receive commissions on.
Advantages of Stairstep Breakaway Plans
- One advantage of the Stairstep Breakaway Plan is you can build as wide as you want for your front line of distributors. You could build your team with each of these distributors or find one “Rock Star” marketer in the group, and focus your attention on them and build a large organization together.
- This plan is now well known and it is widely accepted by regulation agencies. There is no doubt as to the legitimacy of this pay plan.
- Stair Step Breakaway Plans work well for experienced distributors that have good selling, recruiting, and management skills.
- This compensation plan though more suited to full timers, becomes an option for more part-time and novice distributors with recent advancements in the industry. Internet marketing in particular, can dramatically level the playing field and make it just as friendly for dedicated part-time distributors.
Disadvantages of Stairstep Breakaway Plans
- The Stair Step Breakaway Plan is hard for many to understand, and it’s even harder to try and explain it to prospects. This makes selling the pay plan portion of your business difficult from the start at a time when you need new sales the most.
- Sometimes there is an unreasonably high ongoing monthly personal purchase (PV Requirement) to qualify for the maximum commission payments. This can be difficult for many new distributors to absorb as they try to move their business into profit. Attrition rates can be high as a result.
- The plan can be hard to market. A tried and true 50-year-old plan isn’t a sexy sell. It may be difficult to seem appealing to new distributors looking for the next bigger better deal.
- The Stairstep Breakaway plan is considered by many to be a pretty unfair plan that puts strong incentives toward full time big gun network marketers at the expense of part time and novice recruiters. This plan has been responsible for creating HUGE incomes for successful full time distributors. However, it can be a very brutal plan to make money with for the part-timer.
- Another problem with the Breakaway plan is exactly that. It’s a Breakaway Plan! Your strong legs reach the necessary step requirements and they “Breakaway.” You lose their volume after working so hard to help build and develop them. This can be a significant portion of volume or in the worst cases it can be the complete volume of that leg. Ouch!
- The Breakaway feature of the plan offers limited incentive for teamwork within an organization. Competition and isolation between distributors can be the result.
- Finally, the stairstep breakaway plan has a bad reputation for encouraging distributors to buy a large amount of product (inventory loading) every month often creating a stock of products they may be unable to completely use or retail.
What you need to know about Stairstep MLM Compensation Plans to make them work?
This plan as we have mentioned is best suited to those distributors who are confident in their ability recruit new distributors and who have excellent, marketing, management, and leadership skills. For those looking at this compensation plan for the first time, one thing to consider is this; while the potential commissions can be very rewarding with this compensation plan, do you have, or are you willing to attain the time and skills necessary to become successful with this type of commission structure?
All the more with this type of plan you should seek out third party information, tools, strategies, systems, and mentorship to be sure you are positioning yourself for success in the industry. You don’t want to just follow the advice of some old boy that’s still flogging a dead horse telling you he’ll plow fine for you to if you’ll just believe.
Aspects of Stairstep MLM Compensation plans you may not be aware of.
Breaking away from your upline is beneficial for you. You’ll earn a higher commission rate as a result. However, it can have a serious negative impact for your upline. You know, the ones that just lost you. They can still earn commissions from you, and on your volume, but it no longer flows through your to your upline at the same rate. The new reduced commission your upline receives is called an “over ride commission.” Your upline essentially just lost some of their best customers.
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, this override commission as we mentioned, is only a small fraction of what it was.
This aspect of the breakaway plan seems fine for the distributor at first but then as they help to build their teams some of their best distributors and downline members begin qualifying for breakaway status and leave their organizations.
So at first you may be thinking “okay that’s fine I’ll still get some override commission right?” However, you’ll need to maintain a certain level (often quite large) of “open volume” (this is sales volume outside of the volume the breakaway business is creating.) just to qualify for the override commissions.
What’s really frustrating is when the “Rock Star” distributor you helped groom and develop, the one who’s helped explode your business, now breaks off from you. They’re still rockin and building a very large business but now you can’t maintain a large enough amount of open or new business to keep up. So what can happen is you become unqualified for the override commission. The breakaway volume from the rockstars team is now gone… Ouch!!
This can lead to distributors stockpiling product in order to qualify for their override commissions. It’s a frustrating and heart-wrenching situation. Some of the top MLM companies have recognized this and adjusted their compensation plans to help this problem, but the distributor still feels they are leaving money on the table because, inreality, they are!
Unfortunately some companies who’ve used the Stair Step Breakaway in the past helped to give the industry a bad name. Some companies set their group sales volume targets so high that new distributors were encouraged to purchase large amounts of product beyond an amount an average distributor could use or retail.
This practice certainly assisted their upline to earn commissions, but it left a lot of distributors disgruntled and stuck with stock they could not sell. I’m sure everyone’s heard the horror stories of poor uncle Ned who got involved with one of those schemes and got left broke with a garage full of useless products and an ill-tempered attitude toward network marketing. Fortunately, to our knowledge, this rarely happens today. If it does, we suggest you try a new strategy before you get in to deep.
How do Stairstep Breakaway Plans pay you?
There are always at least two parts to a Stair Step Plan
The ”front half” or “front end” is the sales plan. Compensation rises at each different level (step), with the highest compensation at the top step. The goal is to reach the top of the stair step by meeting the different qualifications necessary. Some qualifications are fulfilled by personal (retailing) sales; others by group sales, others are personal sponsoring requirements, and group sponsoring requirements, while some require all of the above to progress up the ladder of success.
Each of the steps has different names and requirements and their titles demonstrate a person has reached a certain level of qualification and achievement.
The following is a hypothetical example of basic Stair Step Plan. Remember there are many variations on this theme.
Step One: A distributor reaches the (first step) when her/his group reaches a certain benchmark of volume sales. Let’s say $300. She/he then earns a set percentage commission on the sales, let’s say 5% on the amount personally purchased, and on the distributor sales/purchases in the sales team legs that have not reached the $300 bench mark yet. A little confusing yes I know… Bear with me.
Step Two: When the group reaches the $600 level per month in sales, she/he attains the next step, the associated title, and earns 10% on personal volume sold and on all those in the team who have not reached $300 yet. You also earn 5% on those that have reached the $300 sales benchmark, but have not yet attained the $600 level.
As $1200 in volume is reached, you attain the next level/step and now receive 15% on personal sales volume, and all those who have not reached $300 yet. You’ll also earn 10% on those that have reached $300, but not yet attained the $600 sales level, and 5% on those that have reached $600, but not yet reached $1200. This program continues until one reaches the top step/level/title let’s say 25% and $5000. I told you it could be hard to explain and understand for both new distributors and prospects.
2. The second half, the back half (back end), or break-a-way, is the managing half of the Stair Step Breakaway Plan. Here is where one gets paid based on their management and training abilities, plus their sales volume consistency.
In this second half of the plan, distributors continue to be paid on the front end of the plan as before, but they are also being paid a percentage commission on the sales volume of legs in their organization who have reached the same top bonus level and have broke-a-way, taking their organization with them. This commission payment only occurs of course if you meet the open volume requirements described earlier in this article.
The back half of the plan is where a person who works for it can achieve stability and financial independence with a residual income. When a break a way occurs, a percentage is earned on the break a ways group volume. As we have mentioned that percentage is less than before the leg broke away, but can still be a significant pay off. If there are enough of these break off legs in your organization and/or they are of sufficient volume generating size, then these organizations take on a life of their own and provide you with a consistent source of stable and residual income for years to come.
Remember that there are many variations on this basic generalization. Stair Step Breakaway Plans are easily modifiable and there be a number of aspects of the plan that may require your consideration. Compression plays a big part in Stair Step programs and there are several different definitions for compression. Qualifications vary, as do percentages of commissions paid out at different levels. Other bonuses and incentives may be included in the basic plan that will have varying effects on determining whether it is a suitable plan for you or not.
Will a Stairstep Breakaway Mlm Compensation Plans work for you?
2-5% of the distributors in any network marketing opportunity (the ones making the big money, building stable teams, and understanding what it really takes and applying it) will say network marketing is the greatest opportunity they were ever introduced to bar none!
Of the 95% of others, reviews will be a mixed bag ranging from ‘I made a little money,” “it wasn’t for me,” to “it’s an outright scam and a pyramid scheme”. This is true of not only Stairstep Breakaway Plans but also of the Network Marketing Industry as a whole.
The difference between win or lose, is in the tools and training you receive, and in the person you are willing to become to succeed. Are you or are you not willing to become trained and informed to succeed in this industry? If you’re not…. forget about Mlm as an option. Are you ready to apply the knowledge and skills you learn on a daily basis? Are you really ready to take your life and income to the next level? These are questions you should have answers to before joining not after.
That’s actually the reason I put this article together. Matrix plans are a great opportunity for the right person. But I also understand that it takes a lot of marketing knowledge, proper training, discipline, and mentorship, for most people to earn a significant income from home. People need to hear the truth; they need answers not hype. They need mentorship and strategies that work.
So I making an offer to people who are both looking at Stairstep Breakaway Plans and to those already involved with them. To those looking at Mlm and to those already involved, and I will show you how to recruit people and build a sustainable residual business income from home using modern day MLM tools and strategies. The game has changed significantly yet too many old boys are still flogging a dead horse telling you he’ll still plow just fine for you if you’ll just believe and want it bad enough.
So what I’ve done is put together an incredible amount of cutting edge information that will teach you exactly how to succeed in Mlm, and it will work for you whether you’re involved with a Matrix plan, Binary, Stairstep Breakaway, or any other proven Mlm Pay Plan! But you need to sign up right now to check out these awesome cutting edge tools, techniques, strategies, and the leadership that is producing breakthrough results in record time in this exciting industry….
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