This page defines commonly used, Bonus-related terms found throughout this KB.
Payouts made to a Rep based on ordering or activity performed within the Bonus Period. This is also referred to as Commissions. Although Bonuses and commissions are sometimes considered to be different types of payouts, these terms are treated as synonyms throughout this KB and simply refer to payouts earned by a Rep for ordering or activity/behavior.
The start and end date for each period that commissions will be paid to Reps. Only orders and activity placed or performed within the Bonus Period will be considered for commissionable payout. This is also referred to as Commission Period or Pay Period.
A Rep’s Bonus Rank is recalculated each Bonus Period. It is the rank used to determine qualifications for commissions and Bonuses. Bonus Rank can be overridden through the use of a Force Rank (see Force Rank definition), which effectively forces a Rep to be qualified at a specified Paid As Rank, regardless of actual qualifications or Organic Rank. Bonus Rank is also called “Paid As Rank”.
Breakage is any Bonus or commission that is left unpaid due to the failure of a Rep to qualify for that type of Bonus or commission.
When a Rep is not Inline Cancelled (moved to the Terminate Tree and their downline reps and personal customers reassigned to the Upline) and is instead left in the genealogy and has their Lifetime Rank set to Cancelled, the system will still recognize the sponsorship ties between the Cancelled Rep and his personally enrolled reps and customers. This means that the Cancelled Rep will be ineligible to earn on any Bonuses, but the system will still recognize the Cancelled Rep as the Sponsor and those payouts will be held as Breakage (will not pay), unless Compression is applied at the time of Bonus/commissions (payouts roll up past inactive or cancelled reps). No other Rep will benefit in Sponsorship Bonuses from the cancelled Rep’s personally sponsored Rep unless Compression is applied or the payouts are based on levels or generations of the Sponsorship tree.
Clawback is the ability to recapture commissions paid on an order when that order is returned. Not all commissions are eligible to be clawed back. When an order is returned, the dollar amount paid to a Rep (or Reps) on that purchase is subtracted from the Rep’s Bonus payout the next time commissions are processed.
For commission purposes only, when a Rep is not eligible (due to Cancelled status or failure to meet payout requirements) for commissions payout, that Rep’s Downline is compressed upwards, effectively removing that Rep from commissions consideration. This is only done for commission purposes and does not affect the normal Genealogy. Compression is applied individually to each Bonus and may or may not be enabled, based on the company's unique rules.
A Customer is associated with a Rep. However, a Customer cannot sign-up other Reps and cannot receive commissions. A Customer is not placed in any genealogy and is considered to be on the same level as the Rep (i.e., Customer is on Level 0 to a Rep). This is also referred to as Retail Customer.
The downline for a rep is all of the Reps that are below the Rep in any Genealogy.
Orders in an Entered status will not be considered for commission or qualification purposes until they are updated to a Posted status. If the Order Date of the order falls within a period that has already been processed for commissions, that order will not be considered for commission or qualification purposes. When the order is Posted, its Order Date must fall within a period that has yet to be processed in order for it to be considered for commission and/or qualification purposes. If an order that has paid in a prior period is unposted and then reposted into a period that has not yet been processed, that order runs the risk of paying out more than once. This behavior should be avoided when possible.
A Flat Dollar Amount is a set dollar amount paid to a Reps when a specific inventory item is purchased. It is a separate amount that is independent from a product's original cost or Volume and is defined by the company. Each product can have a Flat Dollar Amount associated with it. This is controlled at the product level in inventory. Unless otherwise stated, Flat Dollar Amounts are not used for qualification purposes. They are generally only used to indicate a set dollar amount to be paid when an item is purchased.
A Rep’s Paid As Rank (Bonus Rank) may be overridden through the application of a Force Rank. A Rep’s Force Rank can be set from the Secure Rep Data Page of a Rep’s account in the back office. Force Ranks do not help the upline qualify for commissions. It only helps the Rep that has been forced. Force Ranks effectively force a Rep to be paid at a specific rank, regardless of actual qualifications and will override the Rep’s true Bonus Rank only if the Force Rank is higher than the Organic rank. Reps cannot be forced to a lower rank than what they naturally qualify for (i.e., a Rep cannot be forced to a rank below his or her Organic Rank). Force Ranks will not allow a Rep to progress to higher ranks unless that Rep naturally qualifies for higher ranks. Specifically, a Rep must naturally meet the requirements for lower ranks to progress to higher ranks; therefore, a Rep who is Force Ranked and does not naturally meet the qualifications for lower ranks will not progress to ranks above the Forced Rank as a result of the Force Rank. When bonus is processed, a Force Ranked Rep’s Lifetime Rank will be updated if their current Lifetime Rank is lower than the rank at which they are Forced. A Force Rank Expiration Date can be set from the Secure Rep Data Page. If an Expiration Date is not set, the system will apply the Force for all commission periods processed until the Force is manually removed. The Force Rank Expiration Date will only apply for periods in which the Bonus Period End Date falls after the Force Rank Expiration Date. In rare instances, Force Ranks can be configured to help the upline advance in rank.
This is the Company’s overall organizational structure that indicates how and where Reps are placed when enrolled. There may be multiple genealogies in place for a single company. For example, a Binary placement genealogy will be linked to a secondary Unilevel genealogy that tracks sponsorship/enrollment.
A Leg is a portion of a Rep’s organization starting at one of his or her first-level Reps and encompassing that first-level reps's entire downline. If a Rep has 10 first-level Reps, he or she has 10 legs. An Active Leg is any Leg that includes an Active Rep anywhere in that Leg.
A Rep’s Lifetime Rank is the highest rank achieved by that Rep in their Lifetime or since their last demotion. This rank may be demoted or promoted manually from an individual Rep’s back office page through the Change Rank option from the local Administration Menu. The Lifetime Rank mainly affects the Rep’s Inventory Pricing, although it can also have an impact on Paid As Rank maintenance, commissions, and/or volumes. It is also the display rank for the majority of the reports in Revolution. A Rep’s Lifetime Rank is not updated until a commission period is Committed (made official). Lifetime Ranks will revert to their pre-bonus commit rank if a committed Bonus Period is deleted.
An order’s status will directly reflect whether or not the bonus process will consider that order for commission and/or qualification purposes. Orders that will be considered by the bonus process are called Official orders. There are four main order statuses that are applicable to the bonus process: Voided, Entered, Posted, and Shipped. Posted and Shipped orders are the only order statuses that are considered Official, unless otherwise stated. This holds true for Return Orders, which must be marked Posted or Shipped in order for Clawback and/or Commissions Recapture to be applicable.
A Rep’s Organic Rank is the Bonus Rank at which he or she naturally qualifies, regardless of any Force Rank applied. If a Rep has a Force Rank applied but their Organic Rank is higher than the Forced rank, then the Rep’s Organic Rank will take precedence over the Force Rank.
See Bonus Rank
The Pay On Rep is the Rep whose orders and/or volume generated a payout to another Rep. It is the Rep whose activity within the Bonus Period results in a commission or bonus payout.
The Pay To Rep is the Rep who is earning on another Rep’s orders or volume within the period. It is the earning Rep who is paid a commission based on another Rep’s actions within the Bonus Period.
This refers to where a Rep is located within any Genealogy. It also refers to the Rep positioned immediately above a new or existing Rep. The system shows the Placement Relationship based on the Placement position between the two (2) Reps in any Genealogy. In some business models, Placement and Sponsorship/Enrollment are the same. In others, these positions are tracked separately and can be different.
Posted and Shipped orders are fully prepared to count towards commissions and/or qualifications so long as the Order Date of the order falls within the commission and/or qualification period. A single order may pay out to multiple Reps, but will only Pay To each Rep once unless otherwise stated. In addition, unless explicitly stated otherwise, an order will never pay out in more than one Bonus Period.
The start and end date for each period during which activity will be considered when determining a rep's eligibility for rank and bonus qualification. This may be different than the Bonus Period. Only orders and activity placed/performed within the Bonus Period will be considered for commissionable payout.
A person that has filled out the Company application and is in a genealogy is referred to as a Rep in this wiki. This term is generic and is also sometimes referred to as Distributor, Affiliate, Consultant, or Business Partner.
When an order is returned and Clawback is enabled, the commissions that were paid on the volume or flat dollar amount associated with that order will be clawed back or recaptured from the commissions of the Rep to whom that order originally paid. This Clawback will occur in the same period in which the order is returned but will only occur for commissions that were paid on bonus types where Clawback is enabled and will only occur on those return orders that are in Posted or Shipped status during the Bonus Period. Volumes and flat dollar amounts that have Clawback enabled (Clawback Aware) will not negatively affect the Rep’s current period volume or flat amounts for the purposes of qualifications (such as Paid As Rank qualification).
A Sponsor is a Rep who personally brings in a new Rep and who first explains the company business opportunity. Sponsor is also the term referring to a Rep who personally brings in a Customer. A Rep or Customer personally brought into the business is called a Rep’s personally sponsored or personally enrolled. The system also shows the Sponsor Relationship between two (2) Reps in a Unilevel Genealogy. In this KB, Sponsor and Enroller have been used synonymously. Similarly, Sponsored and Enrolled have been used synonymously.
When an order is transferred from one Rep or Customer to another, the system will recognize that order as having been originally placed by the Rep or Customer it is transferred to. Simply, the system will not recognize any links to the Rep or Customer who originally placed that order. This means that the new Rep or Customer who receives that order will benefit from it fully and the Rep or Customer from whom it was transferred from will not be associated with that order in any way. If an order is transferred after it has paid commissions to the Rep (or sponsoring Rep of the Customer) who originally placed the order, no new commissions will be paid to the new owner of that order. If an order that has been transferred is returned, any Clawback or recapture applied will appropriately recapture funds originally paid to a Rep on that order, regardless of who the current owner is.
When a Customer is transferred from one Rep to another or a personally sponsored Rep’s sponsorship links are set to another Rep from the Rep who originally sponsored them, the system will fully recognize those links and will not acknowledge any sponsorship ties that Rep or Customer had previously. Simply, when a Rep or Customer is assigned to a new Sponsor, the system will award that new Sponsor all the benefits of being that reassigned Rep or Customer’s enrolling Rep. This means that the new Sponsor will earn all applicable sponsorship bonuses and will qualify from that newly assigned Rep or Customer as though they had originally enrolled them. The system will ignore any sponsorship ties that Rep or Customer previously had to any other Rep unless explicitly stated otherwise. Additionally, all orders and volume from that transferred Rep or Customer will follow them and will roll up into the new Upline.
This refers to the Rep or Reps above a new or existing Rep in any Genealogy.
Orders in Voided status will not be considered for commission or qualification purposes. Any commissions paid on an order that is later Voided will not be recaptured via Clawback. Any commissions due to be paid on an order that is Voided prior to commissions being processed will not pay. Order-Post based Lifetime Rank updates that occurred due to the posting of an order that is then Voided will not revert, meaning the Rep will retain the Lifetime Rank they earned when that order was posted (unless it is manually adjusted). Business Centers, Coding, and/or Genealogical inserts or moves that result from the posting of an order will not revert if that order is Voided.
Volume is a separate amount that is independent from a product's original cost and/or Flat Dollar Amount and is defined by the company. Each product has a Volume (Qualification Volume or Commissionable Volume) amount associated with it. This is controlled at the product level in inventory.