Sisel Review: An overly complex compensation plan
Truth be told, there’s enough background information on Sisel International to write a stand-alone article on but in the interests of reviewing Sisel, I’ll try to break it down into as concise a picture as possible.
Way back in 1987, Thomas Mower and his wife Leslie D. Mower founded the MLM company ‘Images and Attitudes’. Images and Attitudes revolved around the sale of health and beauty products.
Images and Attitudes was renamed ‘Neways’ in 1992, the company traded on the claim that ‘its products are chemically safer than other brands‘. This marketing claim no doubt contributed to the initial growth of Neways but the company soon found itself in hot water, being forced ‘to recall a weight loss product as it was found to contain a dose at medical levels of the prescription diuretic furosemide‘.
Furosemide (INN) or frusemide (former BAN) is a loop diuretic used in the treatment of congestive heart failure and edema.
It is most commonly marketed by Sanofi-Aventis under the brand name Lasix. It has also been used to prevent Thoroughbred and Standardbred race horses from bleeding through the nose during races.
Along with some other diuretics, furosemide is also included on the World Anti-Doping Agency’s banned drug list due to its alleged use as a masking agent for other drugs.
Following this recall things then appeared to have run smoothly until 2003, when Thomas (photo right) and Leslie Mower were indicted for ‘not paying personal income tax on about $3.2 million‘.
The Mowers were facing charges related to
cheating the Internal Revenue Service out of more than $1 million by failing to report millions of dollars in commissions they received from their company’s overseas divisions.
According to the government, Thomas and Leslie Mower failed to report $3.2 million of personal income collected as commissions from Neways’ divisions in the United States, Australia and Malaysia, ultimately saving themselves a tax bill of $1.3 million.
In their defense, the Mowers claimed
the money was actually meant as loans from Neways Australia to Neways USA, and that they did not personally benefit from the funds.
Testimony from the then Director of Neways Australia however stated that he was ‘unaware of any loans to the U.S. corporation‘ and that he ‘he personally mailed monthly commission checks to the Mowers’ attention to Neways’ Salem office‘.
In response to this, the Mower’s defense attorneys then claimed that because the Mowers hadn’t spent the ‘money like drunken sailors‘ the unreported income was merely a mistake and that the Mowers hadn’t committed a crime.
A federal jury however disagreed and in March 2005 the Mowers and their former corporate attorney James Thompson (who was accused of doctoring up fake loan documents), were found guilty.
In September 2006 Thomas and Leslie Mower, along with their former attorney, were all sentenced to jail time:
Thomas Mower will spend 33 months in federal prison and serve 36 months of supervised release and pay a fine of more than $75,000.
Leslie Mower was sentenced to 27 months in federal prison, a $60,000 fine and 36 months of supervised release.
The former corporate attorney for Neways, James Thompson, was found guilty of one count of conspiracy to defraud the IRS. Thompson was sentenced to spend a year and a day in federal prison.
From what I can piece together Neways continued on under different management and ownership with Thomas Mower going on to launch Sisel with his son Tom Jr. Mower in 2006.
The drama doesn’t stop there though. With Neways appearing to experience a large amount of success in Japan, Sisel and its distributors seemingly tried to plunder the Neways distributor database and recruit internally.
MLM Watchdog details three recent court rulings against Sisel and its distributors:
15 Feb 2008 – A federal court in Utah has issued an injunction against Sisel International, LLC and five of Sisel’s top distributors in Japan.
Among other things, the injunction requires Sisel and these distributors to return all of Neways’ distributor information in their possession and prohibits Sisel and its distributors from using such information.
In addition, the Court found that Sisel’s top three distributors—Koji Yamamoto, Fumiko Matsumoto and Toru Egashira—likely have breached their contracts with Neways by recruiting Neways distributors to join Sisel, and are now prohibited from continuing to recruit Neways distributors for a period of one year from each distributor’s date of suspension from Neways.
Neways alleged that Sisel and its Japanese distributors were misappropriating Neways’ confidential and trade secret information regarding Neways’ distributor network, and that the Japanese distributors were breaching their contracts with Neways by soliciting Neways distributors to join Sisel.
In May 2007, the same federal court ordered Sisel, its owner Thomas Mower, Sr., and several of its employees to return all copies of Neways’ product formulas, vendor lists, and distributor lists, and prohibited them from continuing to use that information.
Two months later, a Utah state court entered an order against Sisel distributors Jef and Patricia Welch restraining them from recruiting any present Neways distributor to participate in another multi-level marketing company.
Cross recruiting is generally frowned upon in MLM yet there appears to be multiple instances of it happening between Sisel and Neways after Mower went on to form Sisel.
Interestingly enough, when launching Sisel rather than remain US-based, Mower chose to establish Sisel’s operations offshore to Sarnen in Switzerland.
The Sisel Product Line
Quite obviously modelled on Neways product offerings, Sisel International markets a range of products including
- age reversal
- weight loss
- dietary supplement
- joint care
- skin care
- bath and body
- dental care
- aromatherapy
- nail care
- home care
- Sisel branded apparel and goods
Sisel manufacture their own products out of a 400,000 square foot nutraceutical plant. I assume this plant is located in the US but I was unable to find any information confirming whether the plant is located in Utah, Switzerland or somewhere else.
As for Sisel’s product policy,
At SISEL, we research the research to find exciting new discoveries in modern science, and bring to market spectacular products unlike the world has ever seen.
We are committed to the use of evidence-based nutraceuticalingredients, known to be of scientifically-proven biological value, in the most concentrated strength and form possible, combined with other synergistic ingredients to achieve maximum results.
Moreover, we strive to avoid potentially harmful ingredients found in common, off-the-shelf products and use only the most pure, potent, safe, and effective ingredients nature has to offer.
SISEL’s products are manufactured under the GMP (Good Manufacturing Practices) standard, and are rigorously controlled to ensure the highest quality in each and every product we produce.
The Sisel Compensation Plan
The Sisel compensation plan is a bit of a nightmare to process and understand, but I’ve done my best to break it down below. Note that for the sake of simplicity I’ve combined several aspects of the compensation plan with others.
Before we get started, it’s important to note the four membership ranks within the Sisel compensation plan and their requirements:
- Bronze membership – 50 PV a month
- Silver membership – 100 PV a month
- Gold membership – 150 PV a month
- Platinum membership – 200 PV a month
Note that PV stands for personal volume and equates to sales you make. For some silly reason Sisel have an additional volume qualifier called Bonus Volume BV which adds to the overall confusion in their compensation plan.
Bonus Volume can be different to PV on the same product purchase and is used to calculate different commissions within the compensation plan. Hereafter where you see PV we are talking about Personal Volume and where you see BV, it stands for Business Volume.
Direct Distributor Commission
The Direct Distributor Commission allows Sisel members to earn a commission on the first 100 BV generated by members they’ve recruited.
The Direct Distributor Commission is paid out as a percentage on the first 100 BV your enrolled Direct Distributors make. Each new member you enrol into Sisel is placed directly under you and to qualify for the Direct Distributor Commission these legs underneath you must have a Direct Distributor in them.
The more qualified Direct Distributor legs you have, the higher the Direct Distributor Commission percentages paid out are. The percentages given below are relative to the Sisel membership rank of those Direct Distributors in your team:
- Level 1 – Bronze 2.5%, Silver 3%, Gold 4% and Platinum 5%
- Levels 2 to 6 – Bronze 5%, Silver 8%, Gold 9% and Platinum 10%
- Levels 6 to 8 – Bronze 2.5%, Silver 3%, Gold 4% and Platinum 5%
- Level 9 – Bronze 0%, Silver 0%, Gold 1% and Platinum 2%
The levels you get paid on depends on how many Direct Distributors you yourself have recruited.
- recruit 1-3 Direct Distributors and receive the Direct Distributor commission down 5 levels
- recruit 4 to 6 Direct Distributors and receive the Direct Distributor commission down 6 levels
- recruit 7 or more Direct Distributors and receive the Direct Distributor commission down 9 levels
Master Distributor Commission
With the Direct Distributor Commission above only covering the first 100 BV generated by your enrolled distributors, the Master Distributor Commission covers the rest.
To qualify for the Master Distributor Commission you must be a Gold or Platinum ranked distributor, be making 1000 Personal Group Volume (sales) a month and have generated an accumulated 5000 PGV minimum.
Rather then pay out per level though, the Master Distributor commission is paid out on “generations”. One generation is defined as the members between yourself and next “Master Distributor” in any particular downline of yours. Keeping in mind that each time you enrol a new distributor, they form a new downline under you.
Using this generation criteria, Sisel pay out the Master Distributor commission down six generations:
- Generation 0 (members between you and the first qualified Master Distributor in any downline leg – 8%
- Generation 1 – 10%
- Generation 2 – 12%
- Generations 3 to 6 – 5-10%
Once again, how many qualified Master Distributor downline legs you have will determine how many generations down you are paid the Master Distributor commission:
- no master distributor legs – generation 0
- 1 to 2 master distributor legs – generations 0 to 2
- 3 to 4 master distributor legs – generations 0 to 3
- 5 to 6 master distributor legs – generations 0 to 4
- 7 to 9 master distributor legs – generations 0 to 5
- 10 or more master distributor legs – generations 0 to 6
Fast Start Bonus
Sisel’s Fast Start Bonus pays out a 30% commission on the BV amount of a newly recruited member’s inital order.
Once this 30% has been subtracted from the total BV the order generated, the remained BV is paid out to the upline on seven levels:
- Level 1 (you) – 30%
- Levels 2 to 5 – 3%
- Levels 6 and 7 – 4%
10% of this remaining BV is also put into a Fast Start Bonus pool which is then paid out to qualifying members by earnt shares at the end of the month.
Shares in the Fast Start Bonus pool are earnt depending on the size of the initial qualified order placed:
- 200 PV – 1 share
- 350 PV – 1.5 shares
- 1000 PV – 5 shares
Note that these amounts are triggers and all qualifying orders are graded accordingly (an order generating 349 PV for example would only trigger the 200 PV level, resulting in 1 share being earnt). These trigger levels can be stacked.
Car Bonus
The Sisel Car Bonus is equal to a 15% of the commissions you earn in any given month. To qualify for the Car Bonus members must have recruited at least three Master Distributors and have earnt at least $2000 for the qualifying pay period.
Joining Sisel
The cost to join Sisel as a distributor is $20.
Conclusion
When I started my research into Sisel I first thought that the history of the company and its management would probably wind up being the focal point of my conclusion.
As interesting as Sisel’s history is though, nothing prepared me for the absurd complexity and unnecessary headache that is the Sisel compensation plan.
After four or five days of trying to get my head around it I finally think I managed to present in a way that’s understandable. But even I’m painfully aware that my break down still reads like something that was designed for math nerds.
Forget the company history and forget the product line, as far as success with Sisel goes you’re going to have to spend countless hours studying their compensation plan if you want a hope in hell of explaining to new members how they’re going to get paid.
The plan itself seems to be geared towards preferred customers and the consumption of your recruited distributors. The compensation plan itself doesn’t even mention retail commissions although with the large product lineup you’d certainly hope there was.
Sisel’s compensation plan documentation is heavily geared towards the idea of signing up people on autoship and keeping them there. With the lack of focus on retail sales combined with a stupidly complex compensation plan I’m thinking there’s a strong push towards just signing up people on autoship and moving on. There doesn’t seem to be any organic demand or anticipation for demand as far as customers go.
Rather the whole business opportunity feels like an elaborate mathematical system designed to extract the most amount of money when you’ve got a bunch of people paying a monthly fixed recurring cost.
Internal consumption in itself isn’t a bad thing but it does leave a sour taste in my mouth. When you couple it with the side-splitting headache I’ve given myself trying to put Sisel’s compensation plan into layman’s terms… you pretty much get an opportunity that is the victim of its own unnecessary complexity.
According to Gerald Nehra, if there is no clear separation of customer and member, then it’s a very BAD thing as it means MLM is actually quite close to a PONZI SCHEME. (that’s from his affidavit in the ASD case).
And internal consumption means there is no clear separation: members are customers.
Sisel actually made a point to state in their compensation plant that everyone pays the same price (retail = wholesale).
They claimed this was to stop stockpiling of products in garages. I took it as a marketing angle to encourage people to sign up as a pref. customer (“it costs nothing so might as well!”)
Then frankly they only moved to Switzerland to get away from the FTC and the agreed-upon “Amway rules”. Amway rules require company buyback and “you must have sold this much to reorder” rule to discourage stockpiling / inventory loading by participants.
What’s the difference between a distributor (participant) and a “preferred” customer any way?
oz,
Good recap of Sisel and their history. Well done. Now comes the “However..”.
However, SISEL International, LLC is a Subsidiary of SISEL International, AG and their corporate office is in Springville, UT. Their large manufacturing plant, which is owned outright by Mr. Mower, is also located in Utah.
The large majority of MLM companies employ a “BV”, or Bonus Volume point system today (some call it CV, or Commissionable Volume). There are very legitimate reasons for BV. For example, lower margin (expensive to produce) products typically have a lower BV value to keep the price down. Although some companies abuse their BVs to create the illusion of a higher payout, knowing most prospects will only consider the percentages in the pay plan, and not BV-to-Price ratios. If you lower the BVs on your products you can afford to pay a higher percentage on that BV, thus creating the illusion of a higher paying plan. Sisel does not appear to be doing this.
The FTC has clearly stated (in a letter to the DSA) that they do not consider what percentage of product is purchased by reps, but rather the motive for the purchase. As long as Sisel reps are buying the product because they actually want them, they are bona fide “customers” of the product.
I’m also not a fan of overly complex comp plans. Most today look like pages out of a chemistry text book. However, this appears to have no correlation to the success of a distributor, or that company. In fact, you can almost gauge the success of an MLM company by the complexity of it’s comp plan. There are three today that I cannot fully decipher, and I evaluate and design comp plans for a living. Mary Kay, Amway and Mannatech. Shaklee’s original plan, which they changed a few years ago, would have also made the list. Note, I just listed four of the largest, most successful MLM companies of all time.
It boils down to Marketing 101: Features vs. Benefits. Reps and prospects don’t care how the plan works, and most can’t explain their own plan. They just want to know why it’s better than other plans, and how it’ll make them more money, faster, and with less effort.
I’m not saying that’s right, or how it should be. It’s just the way it is.
Len
So it’s a shell company? I own this which owns that?
That’s clearly not what I said.
Sorry, that was somewhat of a tongue-in-cheek tone.
In a more serious note, FTC had published a comment by Dr. Jon M. Taylor, excerpt from one of his long reports, that specifically looks at MLM compensation models.
http://www.ftc.gov/os/comments/bizoppstaffreport/00014-57319.pdf
Dr. Taylor, along with Robert Fitzpatrick, are well-known “opponents” of MLM model in general, but their analysis is well worth reading.
IMHO, overly complicated comp models tilts the table in favor of the company rather than the participants. When such costs as marketing, training of new participants, and such were ALREADY offloaded to the individual participants, and the participants can’t even really understand HOW MUCH they will get paid for their efforts, it is rather difficult to understand WHY any one would join this field.
The FTC publishes all comments submitted during the public comment period, regardless of source or validity. In this case, Taylor exploited the comment process related to the FTC’s New Business Opportunity Rule to get his anti-MLM propaganda published on the FTC website (MLM companies were ultimately exempted from the NBOR).
Furthermore, neither Taylor nor FitsPatrick are reliable sources of information regarding MLM. For example, both assert (including Taylor within the document you linked to), that Amway’s “70% Rule”, which the FTC considered when ruling Amway a legal business model in 1979, requires all MLM companies to sell at least 70% of their product to non-distributors. This is utterly false. Neither Amway, nor the FTC, has ever interpreted the rule in this manner, but rather as a restriction on purchasing additional inventory if at least 70% of all previous orders had not been sold or consumed — and the FTC specifically considered *sales to other distributors* as a method for meeting this criteria.
Len
P.S. I have written extensive rebuttals to the commentary of Taylor and FitzPatrick, as well as über-MLM critics Dean Van Druff and Ruth Carter, which essentially act as exposés of their MLM ignorance. This point is off topic for this thread, but if Oz wants to link to them I’m sure he knows where to find them. It’s his blog, his call.
I’ve specifically highlighted them as “MLM Opponents”. Neither side is exactly unbiased. FTC is negotiating an interesting path between the two extremes without stifling the industry.
I sense we’re getting a bit off topic. 🙂 So that’s enough from me. 🙂
I agree. Off topic. One last distinction, then you may have the last word. There is a vast difference between being “biased” and being “wrong”. Taylor is not just biased, he states things as a matter of fact that are completely, verifiably, wrong. Furthermore, he has been thoroughly informed of the inaccuracies of his claims, and specifically his depiction of the 70% Rule, supported by historical, legal evidence, yet he *continues* to make the same false claims. That takes them out of the realm of ignorance or “honest mistake” and into that of outright, deliberate deception.
Merely a clarification… The 70% rule is mentioned exactly “once” in that PDF I linked. 🙂 So remember, take THAT section with much skepticism. 😀
(and the rest with healthy doses of skepticism, as you should treat ALL sources of information, even this website and our comments. )
It was mentioned in section 2-11 (section 2, page 11), and was correct in the context where it was presented.
The 70% Rule as it relates to the FTC and Amway has nothing what-so-ever to do with Webster v. Omnitrition. Furthermore, Taylor has defined the 70% Rule in at least three other places within his mountain of anti-MLM propaganda as:
1) “To avoid FTC action… Distributors must derive at least 70% of their income from retail sales to non-participants” (he’s stated this in two different places), and;
2) specifically in the 1979 FTC v. Amway decision, “Distributors were to sell 70% of the products they purchased each month to non-distributors”.
Robert FitzPatrick has twice (that I have evidence of) misrepresented the 70% Rule in the same way.
@Len
As someone who doesn’t fit this mould, if I was considering joining a MLM company not being able understanding the business model would be a huge red flag and quite quickly remove the company from consideration.
And with all due respect to those that do fit the mould you described, if you join a MLM company without thoroughly understanding the compensation plan and greater business model, you are a moron.
As you would be getting involved in any type of business without thoroughly understanding the inner workings of it.
He didn’t say so, either.
As I said, “correct within the context it was presented”.
And sorry, I didn’t find the other statements through search. I found one with similar topic in 2-28 “What would a good MLM look like?“, but that one was also correct within the context it was presented.
I can make a very educated guess that about 96% of all network marketers didn’t “thoroughly understanding the compensation plan and greater business model” when they joined an MLM opportunity. About 96% of all network marketers also fail to make a profit in their business.
That’s not a coincidence.
I know several of those “morons” you referred to who have earned in excess of $100,000 per month – by promoting the benefits of their opportunity, not the features.
Some of the top Porsche 911 Turbo salespeople promote the fact their cars go from 0 to 60 in 2.9 seconds, and the best Xerox copier salespeople brag that their 4112 model will print 125 pages per minute. I’d bet very few could even begin to explain *how* their product accomplishes this. Why bother to find out when that’s not what their customers want to know?
Len
And they are still morons. Money != intelligence.
They’ll probably be the first to complain loudly if things turn sour too, seeing as they don’t know their own businesses arse backwards.
Comparison fail. Neither Porsches or photocopiers in themselves are business opportunities.
Do you honestly think the people running the actual Porsche or Xerox businesses have no idea how their businesses work?
Pull the other one.
*sigh*
Not the same thing, Mr. Clement.
We’re not talking about selling of objects or service, are we, Mr. Clement?
If you sell [uber-fruit] juice the only message you need to say is “it’s good for you”, everything else is to “prove” that.
In your example, 911 turbo has great 0-60 time, but that fact is to prove it’s a “great car (for you)”. Thus, the details on HOW the car works (launch control, limited slip dif, sticky tires…) is not important. There are lots of reasons to buy a fast car, could be prestige, could be image, could be impress the girl(s), whatever. It’s a selling point, but it’s not *the* selling point.
But when we are talking about comp plans, do the same reasoning really apply? The guy promoting the opportunity is touting it as “Great for you”, so the conversation roughly goes like this:
A: “Opportunity ____ is great for you!”
B: “How it is great for me?”
A: “It makes you a lot of money.”
B: “Uh, how will it make me a lot of money? What do I have to do?”
Not exactly the same conversation, is it?
I suspect the “great salespeople” you cited manage to emphasize all the OTHER reasons to join, with the comp plan being a MINOR sales point. But does that make sense, when one is looking for an INCOME OPPORTUNITY?
This rule makes perfectly sense if you consider MLM to be an income opportunity. With a high percentage of “distributor customers” instead of “retail customers”, the participants (as a group) will spend more money than they earn.
A low percentage of retail customers can indicate the products aren’t very retailable, there’s a flaw in the business model. Products should be possible to sell without adding an income opportunity to them.
Let me make a side comment, before this goes into a flame zone (and I hope it does not). There’s a bit of background info if you don’t know the industry.
I consider Len Clements to be a straight shooter, as I have read many of his papers, and he covers stuff as he sees it. However, Mr. Clements, with his LONG experience network marketing, has a pro-Network Marketing bias. As a result, he, and other proponents of MLM, have had long standing… verbal spars against Dr. Taylor and Robert Fitzpatrick regarding the MLM industry.
I have corresponded with Mr. Fitzpatrick and I found him to be honest and coherent, but extreme in his opposition of MLM. I do NOT agree with his stance that all MLMs are illegal frauds, but I understand WHY he would think so.
And I understand how Mr. Clements believe network marketing is a perfectly valid method of marketing (with the caveat: if done legally and properly) and people who are diametrically opposed to it (such as Taylor and fitzpatrick) are fanatics.
I, as a complete amateur who studied the industry by studying the SCAMS that plague the industry (such as TVI Express), would like to propose a truce. Study evidence on both sides, and reach your own conclusions… somewhere else.
This is really for discussion about Sisel.
And I repeat my position: overly complicated comp plans tilts the whole thing in the company’s favor, by forcing reps promoting the opportunity, who don’t really understand the comp plan, to emphasize other factors as selling points, instead of the most important; how do I make money? What do I have to do?
It was not “correct within the context it was presented”. Amway’s 70% Rule has NEVER been “refined” in any way, by anyone. Once again, the Omnitrition decision had nothing what-so-ever to do with the 70% Rule.
I can source all the statements made by Taylor in their proper context by linking to the documents he produced with the offending text highlighted, but this would require links to the document archive section of my MarketWave website. I’ll post these links with Oz’s permission.
Len
And I’d like to present a word from Gerald Nehra, MLM atty
So, yes, Taylor/Fitzpatrick was correct in stating that SOME regulatory agencies use the 70% rule as meaning “70% must sell to retail”. However, he was wrong in tracing the lineage/origin to the FTC vs. Amway decision.
Can we go back to Sisel now?
Of course they are not the “same”. They are analogous.
When someone tells a prospect that their “Fast Start Bonus” can get you into profit with fewer than 5 people (analogous to a car going 0 to 60 in 2.9 seconds), the prospect typically doesn’t care how the FSB does that. Nor do they really care what the mathematical algorithms are to:
1) earning overrides “down 6 generations”;
2) a 50% matching bonus, or;
3) a car bonus.
They just want to know:
1) They’re going to get paid deeper, thus on potentially a lot more people;
2) If they enroll a high earning superstar they’re going to get paid part of what he/she get’s paid, and;
3) They can earn a BMW to show off.
We’ve migrated way off the topic of Sisel, and I think our points have been made. Other than Oz’s response to my posting of Taylor’s statements regarding the 70% Rule, I am bowing out of the discussion.
Thanks, guys. It’s always fun to mix it up a bit without someone resorting to personal attacks.
Len
@Len
Great, so let’s not waste our time trying to compare the two then. Understanding a business model of a company you are going to join as a business owner has nothing to do with understanding how a photocopier or car works as a consumer.
Regarding further discussion of the 30/70 rule, if it’s within the context of Sisel then by all means go ahead.
Legally or otherwise I maintain that as a general rule of thumb having a company able to show that 70% (I’ll even accept over 50%), of it’s purchased product is being purchased by genuine retail non-member customers is a great indicator of the long-term stability and legitimacy of the company, the product(s) and its business model.
MLM should first and foremost be about the sale of products and/or services to customers, not about how close you can rig a business model mathematically to appear not to be a scam despite any dubiousness of your business model as a whole (and I say that in general, without making reference to any one company in particular).
@Len Clements
Have you ever tried “2 in 1 pictures”, the pictures with two different pictures in one. Some of the most well-known is “What’s on a man’s mind?”, “Old lady / young lady” and “vase / 2 faces in profile”.
If you have tried some of them, you should know you’ll have to “unfocus” from the first image to be able to see the second.
I can clearly see both your image and mine.
1. I will agree, the Amway rule has never been refined.
2. Yet, it can still be possible for people to consider the Webster vs Omnitrition to be some sort of refinement of the Amway rule.
But shouldn’t they know WHAT THEY NEED TO DO to earn these great bonuses? i.e.
Do A, get B?
Doesn’t a overly complicated plan distract from that?
Or is the point simply to emphasize, much like the lottery pushing “get your dream”, even though the chance of getting the jackpot is like 100 million to one? (and with an overcomplicated comp plan the chance is “unknown”, because you don’t even know how to get it?)
At least with lottery the “how” is simple: buy more tickets. What about the comp plan’s “how”?
You’re right.
A sales-man will usually not need any deep insight into what he’s selling, but how much insight he will need depends on what he’s selling and to which customers.
Usually it’s more important to know WHY the customers buy the products, being able to identify different sets of motives rather than the technical details for the products. Most of us are looking for “solutions to something”, or the expected result of what we’re buying, what we believe the product will do for us.
A technician will need deep insight into the technical details, but a sales-man will only need it if the customers are technicians or something similar, or if he sells something that really needs to be explained using technical details.
People who buys an income opportunity will be far more interested in how much money they possibly can make, and what’s required of them to make it. As customers, they are usually eager to sign the contract if they believe the opportunity is right for them, “if they can make it” in the opportunity.
I have the impression that most of the “customers” only looks at specific parts of the compensation plans, and ignores other parts.
But the focus on recruitment is also why most MLM/NWM will have problems when it comes to retail customers. Selling products to retail customers will usually require other methods than selling opportunities to income opportunity seekers.
I was just informed of this post and after taking the time to read all including comments I would like to thank you all for your insight and give a little as well.
Specific to Sisel’s “overly complicated” comp plan: what you have to do to qualify for bonuses (and I am talking the least you have to do to completely qualify).
1. Consume at least $50 worth of product monthly (to move up In commission rank from bronze at $50 a month to platinum at $200 distributor either orders more product personally or has preferred customers combined orders are $150 or more) in other words with this plan your customers orders help qualify you for commissions.
2. The wider you go the deeper you get paid but the first 5 levels (45% of the 67% in this bonus) on the direct distributor bonus are paid if you only have 1 distributor.
3. Attain master distributor by building a team that produces $1000 in monthly sales in your first 30 days or $5000 over any amount of time.
4. You have to HELP people to move up in rank after this. Which in my opinion is a great way to weed out the greedy from the professional who really understands what MLM is all about. To move up in MD rank you help your business partners become Master distributors as well.
The Sisel comp plan is a bit daunting at first but show me one that is not. Lem is right when he says the majority of people want benefits over features.
We all know those making $100 k a month came to understand the comp plan whether it was the first time they saw it or not their success had less to do with understanding the plan and more to do with having tenacious passion and diligence. Something most people could use more of.
If you really want the “features” of Sisel’s comp plan…. here are a few.
1. No coded bonuses
2. No binary
3. No breakage using dynamic compression
4. Sisel gives an error allowance – if you miss a qualification they allow you to use your error allowance and qualify. (there is no other company I am aware of that does this, I am sure someone will inform me otherwise)
5. For 2 consecutive months after becoming an MD the monthly qualification volume goes from $1000 to $500. Again to help the new person with a small team qualify and build a solid business.
There are more like the infinity bonus being an additional 5% to infinity but for now these features are proof that Sisel’s plan (even though complicated like the rest) is created for the distributor and not the corporation.
In short these are some facts about Sisel’s comp plan for those truly researching and some opinions from myself and everyone else who wrote and commented on this post…nothing more…nothing less.
To our success, Dani
If you join a company without understanding the compensation plan, you have failed a primary aspect of thorough due diligence, regardless of whether you make any money or not.
As someone who goes over 5 or so different compensation plans a week, I wholly stand by my original sentiment that Sisel’s compensation plan is unnecessarily complicated. Confusing your distributors is so 1990s and Sisel could do huge favours for themselves if they redid their comp plan (or worked out a better way to present it).
Case in point, your examples might mean something to MLM veterans familiar with comp plan terminology but it means buckleys to a newcomer. Try explaining Sisel’s comp plan to that demographic… wait, let me grab some popcorn first so I can enjoy the show.
Overly complicated comp plan leads you to explain the “goodies” instead of the journey, thus distorting the overall picture.
There are PLENTY of comp plans that are simple. The more complicated the plan, the more it is probably tilted in the company’s favor.
Enjoy the show and know that I was one of the 96% who did not understand the comp plan in 3 companies I got involved with.
The first 2 I failed in. The 3rd (SISEL) I build proudly & successfully regardless of anyone’s opinion of the comp plan.
I add this post to inform everyone that SISEL has actually updated and simplified the comp plan https://live.mysisel.com/cms/ROOT/cms-complan/CompPlanJan2013.pdf
I would love to read a days worth of responses to each of your opinions on this new plan.
I will grab some popcorn and anxiously await your constructive & biased opinions. We all have them. Cheers.
So how did you explain the comp plan? Or you didn’t bother?
I had a quick look at the PDF, still looks as confusing as ever.
I’ll go over it sometime in the next few weeks and see if there’s enough changes to warrant a new comp plan review.
What is it with January and MLM company’s rewriting their comp plans? The work never ends around here!
Charles Scoville (as he awaits his fate with the SEC) is involved with this now.
signup.sisel.net/en-gb/products-gb/