Binary vs Generation MLM Compensation Plan-mlm software tamilnadu

What is Binary Plan?

Here in this plan, it is two-legged structure one is right leg and the other is a left leg in the MLM structure. Each distributor will be able to recruit only two members and the two members, in turn, will be able to recruit another two members in the right and the leg of the MLM structure. This is how the structure goes in Multi-levels of this business.

What is Generation plan?

The generation plan is an MLM plan which is based completely on product selling and profit-sharing of the marketing business.

Comparison of Binary Vs Generation MLM Compensation Plan:


1.The structure is perfect with two legs as left and right leg of binary whereas here in generation plan, the number of downlines does not restrict width as well as depth-wise.

2. In binary structure, the depth is unlimited whereas in generation plan both width and depth is unlimited.

3. There is spillover in binary structure whereas there is no spillover in a generation plan.

4. The binary structure looks simple with two legs of downlines and spillover will always fall under the power leg but the structure of the generation plan involves an infinite number of downlines depth and width-wise for a distributor and forms the generation levels.

5. In Binary, there is no need for a separate group of generations as the structure is perfect. Whereas in Generation MLM plan, the structure is completely from product selling and generations of the group of downlines are from the MLM company.

6. Binary plan is a volume-driven plan, whereas generation plan is a sales-driven plan.

7. The binary plan expands very fast as it needs to recruit only two downlines for a member. whereas in a generation plan, there is no limit for downlines.

Commission Calculation:

1. The MLM compensation calculation becomes easier in Binary MLM when compared to generation MLM

2. In Binary MLM Plan, the commission is based on business volume points earned by the downlines and not by the levels of downline but as there are generations in generation plan, the commission offered is based on the levels of a generation.

3. In Binary MLM plan each member earns a commission based on a certain percentage of downline’s business volume. In generation MLM plan the commission is calculation is by profit-sharing in the generation at each level.

4. In Binary, there is no level commission and commission will not decrease with increasing levels. In Generation plan, the commission decreases as the level of generation increase. For example at the first level the members may get 10%, second level 6%, third level 4% and so on.

5. In Binary plan the earning benefits are not the same. Whereas, all the members in the generation plan at each generation level will have the same earning benefits.


1.Binary MLM plan is structure is in such a way that the rank of the member depends upon the position of a member in the network. Whereas In a generation plan, the rank of similar or different rank people will be under each generation level.


1.In Binary MLM Plan, there are generally two types of bonuses i.e pairing bonus and sponsor bonus involved. Here in Generation plan, it is based on target sale and at the level of the generation.

Product Advertisement:

1. When compared to the product advertisement in Binary plan, here Generation plan is mainly based on product selling and so less advertisement is required.


In this article, hope you will be able to understand the benefits of binary and generation MLM plans by analyzing the differences between them. It is important for any MLM organization to analyze and customize the MLM plan to stay profitable with their MLM business.

Similarly, the comparison of Unilevel vs Binary MLM Compensation Plan provides you more information about the other two of the major MLM plans.

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