Help...which company pays the most?

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  • Anyone here good with math? If so...which compensation plan looks like it would bring in more money (this is for the TOP level in each)?


    Company #1:

    1st Line 19%
    2nd Line 12%
    3rd Line 4%
    4th Line 2.50%
    5th Line 1%

    Team Sales Requires: 80,000
    Get to Leadership: Recruit 40 people (w/ 25 recruiting 4 each)
    Personal Requirements: $1000 per month


    Company #2:

    1st Line 15%
    2nd Line 6%
    3rd Line 6%
    4th Line 6%

    1st Generation Level 0.50%
    2nd Generation Level 1%

    Team Sales Requirement: 60,000
    Get to Leadership: Recruit 7 active (w/ 2 Sr Directors & 1 Director)
    Personal Requirements: $700 per month


    Company #3:

    1st Line 10%
    2nd Line 5%
    3rd Line 5%

    1st Generation Level 3%
    2nd Generation Level 3%
    3rd Generation Level 3%

    Next Generation 1st Level 2%
    Next Generation 2nd Level 1%

    Team Sales Requirement: 250,000
    Get to Leadership: Based on group volume
    Personal Requirements: $100 per month
  • You just can't look at it this way unless they all sell the same products at the same prices.

    If company 1's average product retail is $10, you'd make $1.9 on the item. But if the average price at company 3 is $100, you'd make $10 per item. Average customer purchase is probably a better way to compare.

    But the bottom line is that you're likely to make the most selling a consumable (or recurring purchase) product that your potential customers want and need and that you believe in.
  • I am good at math and am trying to figure out the profit per $1000 assuming the bare minimum, but it's SO different, because the first company requires there be 140 people, minimum, in your downline, while the second company requires significantly less. In fact, not knowing what a Sr. Director's downline requirements are, and not knowing what a Director's downline requirements are, it's really hard to even estimate the minimum required downline in the second example. You haven't provided enough information to answer the question.

    Ultimately, I would guess that these three companies have vastly different average sales and different signup fees, and different potential profit as a result. I wouldn't use the difference in top-of-company profits as the reason to join a company. How hard is it to get there? Is it reasonable to assume that, with company one, you'd be able to personally recruit 40 people and help 25 of them each recruit 4 people? That's a heavy recruiting-focused company.

    With company 2, the focus seems to be more on building a few great leaders than bringing in a lot of people. It's also focused on bringing in people who really work their business. In that company, the average sales per downline rep is going to be much higher than in company one, regardless of what the answer is to my question about how many reps required for senior director and director. This company seems like more of a sales and leadership-focused company than a recruiting-focused company.

    Now company 3 is interesting. This is a company that requires very little ongoing business productivity from its top-level leader, and doesn't set a number requirement on the downlines, but has a HUGE sales requirement from the organization. Since it's possible to earn a large income from your downline while doing little personal sales, I had red flags going up that this organization would require some due diligence to ensure it is not a pyramid scheme. Other red flags would be a large initial sign-up fee and large bonuses for signing up new reps. It's nearly impossible to estimate the earnings from this organization since there are no parameters I can use to estimate the distribution of reps through the downline. That being said, I would say this is a recruiting-focused company, since the only way I can think of to generate $250k in monthly sales is to have a massive team and constantly be replacing those who fail to renew or stay active.

    Given these three comp plans and no other information about the company, I'd choose #2. But, that's me. You may be someone who is great at cold calling and building a ton of contacts and if that's the case, company 3 might be very lucrative if it meets the "small test" for being legitimate.
  • You know, if you are really interested in this, ask each of the three companies you are considering for a financial report showing the range of income of people at each level in the company. Many companies create these and it can be very useful to see what the low end and top end is at each level, as well as the average/median.
  • Here are the three companies:

    Company 1: Jamberry Nails
    Pros - affordable product, unique, online orders, inexpensive start-up ($99 kit), consumable product
    Cons - ?

    Company 2: Origami Owl
    Pros - love lockets, wear it and get interest, something new and different, would enjoy hearing their stories as they build their locket
    Cons - more expensive start-up ($399 kit is really needed), parties seem difficult and time consuming to set up

    Company 3: Paparazzi Accessories
    Pros - can recruit shop/salon owners, free website,
    Cons - expensive start-up ($300 kit is best at minimum), have to sell ALOT to really make a profit (everything just $5), website not set up for online orders, people who do well seem to have elaborate displays (ugh!)


    And Liz...thanks for some insight!
  • Wow Liz, thanks for your analysis. I wouldn't have known where to begin to understand those numbers. It's very interesting to see the comp plans for other companies and to see so many different aspects to weigh before making an informed decision.
  • I never would have guessed those were the companies. How interesting!

    Glad you found my comments helpful. Sometimes it's good to be a financial analyst!
  • Quote: Company 2: Origami Owl
    Pros - love lockets, wear it and get interest, something new and different, would enjoy hearing their stories as they build their locket
    Cons - more expensive start-up ($399 kit is really needed), parties seem difficult and time consuming to set up
    I'm just wondering what you think would be difficult & time consuming to set up as far as parties go for Origami Owl?

    I get to a hostesses house about 30 minutes prior to get things set up. I can carry my table, display items and inventory all in one trip and get set up and ready to go before the party starts.
  • Liz mentioned a great idea. I can't tell you how helpful it was in my decision to see different rank income potentials. Some companies don't share.
  • It is so hard to compare compensation plans directly. Because there might be different definitions of what a Line is and also what are the requirements to promote up to the next level.

    Like with Thirty One. We don't do lines. We do Generations. You might think they are the same but they aren't.

    Our Generations are anyone that is underneath you that doesn't have a Director between you.

    So you can have a recruit under you that sponsors 5 people and you make the same on all of those people until a Director is promoted out. It doesn't matter how deep the team gets, you still earn the same until a Director promotes out. Also The Director will always be in your Gen 0 so her personal sales will always count for your Gen 0 requirements. Once you promote out 2 Directors, you begin to earn higher percentages (not less) on your deeper generations. We also only have to sell $4000 per month in our Gen 0.

    Now to compare (and the numbers may have changed some since I was in) with my former company.

    The first level of leadership was similar. You still only had to have 4 people (same as 31). You earned a higher percentage on your team but the team was required to sell $8k to earn the override and the Director was required to sell twice as much to earn the override. When she promoted out another Director, that level's override was cut in half. So the deeper it went, the less money they made on their downline under the Director.

    So my point is, it is complicated to be able to compare. You can make money with any DS company. There are strengths in every career plan and areas that might not be quite as good as another. They all work if you work your business