In this article, I was going to focus on the workings of your average profit share program's
compensation plan but yesterday, being Monday, when allot of PS programs distribute
earnings to members, I had to Blog about what occurred and the error I feel some Admins
are making..

What happened was that the rebates are dropping in a lot of the older programs like
LindaO's, AdTrafficExplosion, among others. I believe she hit the nail right on the head
when she stated in an update that the big money is going to the newer, more popular,
profit shares. Why is that happening?

Now..here is my take on all of this. About a month ago, some of the Admins began
promoting new profit shares launching in their updates as well as on their sites.
Their aim was to gain referral commissions from members who joined in their
downline but....in doing this they are actually diverting funds away from their own
program.

OK....I'm offering 14% a week in a profit share, for example, but I am telling you to go
to Acme Profit Share because they are giving out 10% per day! Now...where is your
money going to go? Exactly....I'm going to ride out that 10% per day as long as it's
available.

When I walk into Wal Mart, here in Halifax, Nova Scotia,...there will not be any signs
or advertisements about my favorite hardware store Canadian Tire in there that just
happens to have a sale on snow tires that are cheaper than Wal Mart's.

Wal Mart's head honchos are too cute for that or any business for that matter..they are
not going to send customers away and that's what these profit share Admins are doing,
losing money in the process and that trickles down to members waiting for that usual
14% weekly rebate which is not happening.

On to the compensation plans where I will use My Market Shares as an example.
Theoretically, for every 2$ earned you will lose 1 PIP. With a deposit of $100 to buy
100 PIPs and cashing out every week you will have $200 and 0 PIPS. A two for one
deal..the Admin gives you $2 and takes back 1 PIP. With a 50% cashout it's a trade off
....the Admin has $2 for you in pay and initially takes 1 PIP away from you but when you
only want $1 and roll up the rest....the other $1 buys another PIP for you and you are back
to the same amount of PIPs that you started with...this will never change if all you do is
cashout 50% of your earnings.



However...where the 50/50 rule that is in place in the majority of programs, the Admins
will penalize you for taking out more than 50% of your earnings by taking an equal amount
of PIPs for every dollar earned...so you are not gaining if this is all you ever do...all you
would be doing is earning your principal back.

Allowing 100% roll up will realize a gain in pips for you of 50% of your earnings..confusing
as heck I know but if you take two pieces of paper and put your PIPs on one sheet and
your earnings on the other in a given week and decide on a cashout amount you will see
what I am attempting to explain here. I believe more than 50% of members in profit shares
do not understand this principal and I hope I have made it a little easier to understand.


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