The Binary Plan: A Strategic Choice for MLM Business Growth 
                     Understanding the Binary 
Plan for MLM Business 
Success
Epixel MLM Software
www.epixelmlmsoftware.com 
Introduction
 Success of a direct selling ompany depends on the compensation plan 
the company choose. 
 There are wide variety of MLM compensation structures which opens up 
numerous income possibilities, like binary, unilevel, and matrix plans 
being the most widely adopted.
 The binary compensation plan stands out for its flexibility and 
scalability across industries and most of the top MLM companies use 
binary plan as their compensation plan.
S A M P L E  FO O T E R  T EXT 2
What is a Binary MLM Plan?
 A binary compensation plan operates with two legs—left and right—
ensuring a structured and balanced sales flow, where commissions and 
bonuses are distributed based on a well-aligned genealogy.
 Each distributor can directly recruit only two members, and any 
additional recruits become spillovers placed under the existing legs, 
helping strengthen team growth.
 This placement pattern continues down the direct selling organization, 
extending to unlimited depth or up to the limit set by the company.
S A M P L E  FO O T E R  T EXT 3

How does Binary MLM Plan 
work?
 The binary plan’s structure makes recruitment easier, as distributors 
earn based on the sales volume generated in either their left or right 
leg according to the company’s rules.
 Commissions are determined by the weaker leg’s sales volume, unlike 
other plans that calculate payouts across multiple levels of 
distributors.
 The weaker leg, known as the pay leg triggers commission payouts, 
after which the corresponding sales volume is deducted from both the 
pay leg and the stronger “reference leg.”
Advantages of Binary MLM 
Plan
 Weaker-leg–based commissions motivate distributors to strengthen 
that side, boosting overall productivity.
 The plan’s simplicity makes it easy to understand, helping distributors 
onboard and train new members quickly.
 Weekly commission cycles allow distributors to receive earnings 
faster.
 Strategic placement of spillovers helps distributors optimize their 
structure and increase their benefits.
 Spillovers reward both the sponsor and their upline, making it an 
attractive feature of the binary compensation model.
Disadvantages of Binary MLM 
Plan
 Some companies use a flush-out rule, removing excess volume from 
the stronger leg instead of rolling it over to the next cycle.
 Certain direct sales organizations disable spillover preferences, 
placing spillovers automatically without distributor control.
 Weaker-leg–based commissions can become a drawback if that leg 
stays inactive, reducing the value of efforts made in the stronger leg.
Tips to reduce commission 
overpayment 
 Provide bonuses based on weaker-leg volume in set cycles rather than 
paying a percentage on all weaker-leg sales.
 Apply flush-out limits to remove excess strong-leg volume after it reaches 
a defined threshold.
 Discontinue payouts to inactive distributors for downline or past sales 
after a designated period.
 Review commission totals each cycle and adjust the binary compensation 
structure as needed.
The role of Binary MLM software
Binary MLM software 
streamlines every part of As data became central Handling large volumes of 
business management, to business operations, customer data securely is 
from onboarding safeguarding that now essential, and 
distributors to addressing information also became advanced MLM software 
precise and timely a top priority for direct effectively supports this 
commission payouts. selling companies. need.
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www.epixelmlmsoftware.com/blog/binary-m
lm-plan-most-suited-for-business
 
Thank you Epixel MLM Software
www.epixelmlmsoftware.co
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