Party Plan Pay Plan

10 Feb

dollar-signMost people understand how traditional compensation works: you’re either paid an hourly wage for number of hours worked, or you’re paid an annual salary.  In some sales positions you’re paid a base rate, and then a percentage commission on sales. Yet understanding a direct sales party plan pay plan can be more difficult to comprehend, at least initially.

Many party plan companies have a compensation plan based on the consultant’s personal sales (personal volume) and a percentage of downline or team sales (team volume). Because it is a different structure than what most are familiar with, the lack of understanding how the pay plan works can lead to disappointment and failure to reach full earning potential.

The easiest way to think of a direct sales compensation plan is that a party plan consultant’s pay is derived from personal sales and from royalties paid on downline member sales. The “and” is very important. Too many think of the downline bonus as extra. Rather it’s essential to think of it as two parts make a whole.

Because some direct sellers still haven’t grasped this concept, consultants are satisfied accepting only half of their compensation. In a traditional compensation, an employee would be mad if she only received half a check, but there is still a large group of consultants and distributors who are content with only half.

Sure you can earn extra income in direct sales with just one check from the commissions on your own sales; many do that and are okay just earning a little extra. Although if you’d like to earn a full time income it will require a paradigm shift that you want and need both checks. If you just earn on your own personal sales, you’re only getting half a pay check.

Ironically, periodically we hear downline team members complain that the upline is “getting paid off of me (downline)”. This is true; but it shouldn’t be a topic of negativity. It’s almost as ridiculous as saying that a plumber gets paid for fixing toilets. It’s merely how the compensation works.

To their defense, consultants who make derogatory comments about their upline’s pay often lack a clear understanding of how their own compensation is derived. They’re not alone. Those who are new to party plans will need training, patience and repetition to help learn this new pay plan.

Only you know your financial goals. You can earn half a check or a whole one in direct sales. If half is sufficient, then it’s all good. If you’re striving for a more sizable income, then hopefully you’re ready for a paradigm shift and you’re able to see the party plan pay plan as two parts that make a whole.

See you at the Top!

Join Home Party Divas today for coaching, support, advertising and support for only $19.97 a month.

Debbie Shulman, Owner of Home Party Divas is a mom of 4 and a happy wife in a happy life. Lives in Florida. She loves direct sales and feels it is the best way to own a business without a large investment.

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3 Responses to “Party Plan Pay Plan”

  1. Cheryl Fritsch-Middleton February 10, 2014 at 2:03 pm #

    My company’s plan is very much focussed on building a team. I make more the further down the line the person is from me as far as 7 levels. I love that we are encouraged to build a team and support them and we never feel like we are in competition with our uplinks or downlines. I love this concept and it was a key factor in my decision to go from a user to a sharer and builder.

    • homepartydivas February 10, 2014 at 4:24 pm #

      Wow. I have not heard of that before. Make more deeper in your downline? Cool!

      • Cheryl Fritsch-Middleton February 10, 2014 at 4:59 pm #

        Absolutely so I am always engaged in helping my team grow. For people on my frontline I get 2% for everything they buy, 3% for people directly under them and so on so as your team grows so does your check. I love that atmosphere and it was key in me choosing to start building a business with doTERRA.

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