Sales management is usually shallow. Distributors can often promote themselves to management through their recruiting and sales efforts though higher levels of management are often appointed. The distributor recruits other agents and hostesses who hold parties and recruit retail customers. Hostess receives purchase credit for efforts based upon party success. Generally, there are several levels of management commissions but only a small percentage of total sales dollars is paid to management.
Volume is created by recruiting and retailing products.
Various discounts or rebates are paid to group leaders. A group leader can be any distributor with one or more downline recruits. Managers receive commissions on the group sales of their downline managers which often becomes the majority of their earnings. These plans pay unlimited commission on limited downline groups. This is the most common type of Network Marketing plan.