In a multi-level marketing or affiliate marketing program, a "Downline Commission Structure" is used to incentivize and reward affiliates who recruit and sponsor other affiliates into the program. This structure is based on a fixed rate of 2.5% commission earned by upline affiliates, which is calculated based on the net profit generated by their downline affiliates.
To determine the net profit, various deductions are made from the total customer win/loss. These deductions include 18% of the total customer win/loss, any bonuses given to affiliates, and payment fees, which consist of 2% for deposits and 1.5% for withdrawals.
The formula to calculate the net profit is as follows: Net Profit = Customer Win / Loss - 18% Deduction - Bonus - Payment Fee (2% Deposit + 1.5% Withdrawal)
Once the net profit is calculated for a particular downline affiliate, the upline affiliate who sponsored them will earn a commission of 2.5% based on that net profit. This means that the upline affiliate will receive 2.5% of the net profit generated by their downline.
The idea behind this commission structure is to encourage upline affiliates to mentor and support their downline, as they directly benefit from the success of their recruits. By offering a fixed commission rate based on the net profit, it aligns the interests of the upline and downline affiliates, creating a mutually beneficial relationship. As the downline affiliates work to generate profits, the upline affiliates are incentivized to provide guidance and assistance, ultimately leading to the growth and success of the entire network. This structure also ensures that the upline affiliates receive a fair share of the profits generated by their downline's efforts, motivating them to continue expanding the network and recruiting new affiliates.