This arrangement allows you to construct a constrained width association. If there is a 1 X 12 group that means one individual on the first level pays 12 levels profound. However, in MLM Matrix Plan it is not the case and one can add infinite members in the first level and thus, the width increases. This is exceptionally straightforward and simple.
In Binary Compensation Plan one member can recruit two people to the first level. This means that the sponsor can make only two distributors underneath, i.e. Left Leg and Right Leg. It is also referred as Power Leg and Profit Leg. If member sponsors more than two new members, excess members are placed at down line below the sponsoring member's forefront. This 'spill over' is an attractive feature that appeals new members, since they only need to sponsor two members to participate in the binary compensation plan. That is why it is often termed as Binary Spill over MLM Plan. Earnings in Binary plan is always calculated on matching volume of sales done from both legs. And unmatched business volume gets carry forward for next payout. Matching volume may vary such as 1:1, 1:2, or 2:1. MLM Binary Plan software can also be combined with Level or Forced Matrix that results in hybrid software MLM plan.
Let’s Understand Binary MLM Plan with an example that is based on 1:1 ratio concept. Suppose a company has decided the package amount of Rs. 500 and binary matching percentage is 5% of the package amount (5% of Rs.500). Sponsor A, can have only two direct members; B on its left & C on its right. B will have two members as D on the left side and E on the right side. C will have members as F on the left side and G on the right side.
For income calculation, we divide this tree in two parts as Left and Right.