Stair Step Breakaway Plan

The Stair Step Breakaway Plan was one of the original network marketing compensation plans and is still used by a number of foundation companies today. As this compensation plan has been around for many years, it has proven to be successful for new companies to implement. However, just like all compensation plans there are also a number of disadvantages, which are also discussed in this section.

The name Stair Step Breakaway is derived from the concept that distributors climb the ladder of success and when they reach a certain level they are allowed to break away from their upline distributors and run their organisation independently. This allows them to earn greater commission.

The Stair Step Breakaway Plan shares a number of similarities with the Unilevel Plan in that each distributor is only allowed to sponsor one level of distributors (frontline). There is also no limit to the width (number of frontline distributors) in which you can sponsor. Naturally, just like all network marketing companies, the goal is to distribute the parent company’s products. This is best achieved in the Stair Step Breakaway Plan by recruiting as many frontline distributors as you can, whereby these distributors are encouraged to personally consume and/or sell a product.

Breaking away from your upline has many benefits to the distributor, like earning a higher commission. On the other hand, it can have a negative impact on the organisation that they broke away from. By breaking away, the volume that your upline previously received from you, no longer flows through your upline’s business at the same rate. For your upline, it is like losing their best customers.

As distributors breakaway, the original sponsor is still entitled to earn a small percentage from each break away distributor efforts. This is referred to as an override commission. Each breakaway organisation 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 previously.

Similar to the unilevel plan, where every sponsored distributor is placed on the frontline, there is limited incentive for teamwork within your organisation. Competition between distributors can make it difficult to recruit close friends and family as well.

Another set back with this Plan is that although you may have reached the level where you are allowed to break away from you upline, allowing you to earn greater commission, your organisation will grow and distributors in your downline may also qualify to break away from you. Although initially having a distributor break away from your organisation can put a dent in your short-term income, creating a number of breakaway organisations can help you to earn a long term residual income and re-focus your time towards developing a frontline of future leaders.

In general, this plan is again most suited to those distributors who are gun recruiters and have good management skills. For the first timer in this plan you may experience a lack of support from your upline distributors and competition from other crossline distributors. This can work against you and should definitely be considered when looking at a network marketing company for the first time. The Binary Plan and the Matrix Plan are much more friendly and supportive for newcomers.

In years gone by, some companies who used the Stair Step Breakaway gave the industry a bad name. In this structure the group sales volume (PGSV) were set at unrealistic targets, where new distributors were encouraged to purchase extra product to assist their upline to earn a commission. Consequently, a lot of distributors ended up being stuck with stock they could not sell. High hopes were drummed into some of the distributors that lead them into financial trouble. Fortunately this rarely happens today, to our knowledge. If it does, we suggest you try a new strategy.

Another set back to the Stair Step Breakaway Plan is that it is hard for many to understand and even harder to try and explain it to your prospects. It was not until we had reached a certain level of success with this plan that we thoroughly understood how it worked. Looking back, we probably understand it better since being involved with other plans and learning the difference.

Without being biased, the Stair Step Breakaway Plan does have a number of advantages. It has a good track record, which makes it attractive to new companies looking for a proven business model. In particular, the Stair Step Breakaway Plan works in favour for those distributors that have good selling or recruiting skills. Some might argue that this compensation plan is more suited to the full timers, however recent advancements in the industry, particularly the internet, can make it just as friendly to the part-time distributors.

Although the compensation plan should be considered when joining a network marketing company, we strongly recommend that you do not join a network marketing company purely based on the compensation plan unless you already have experience in the industry.

Learn more about the Binary Pay Plan.

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