There are two important concepts in the Direct Selling industry that take a special relevance in the Multi-Level Marketing and Party Plan models, where the compensation plan includes a network structure. These two concepts are upline and downline. In both models, each person of the sales force (also known as representative, consultant, distributor, etc.) is part of a network that is constituted by the upline and the downline.
Compensation plan structures can be complex depending on the company but the definition of this two concepts is actually very simple.
Downline: It refers to the network members that the consultant has recruit or that have join the organization after his/her enrollment. The downline represents income for the consultant, as they receive a percentage of their recruit’s sales.
Upline: It refers to the person who recruited you into the MLM company (that person is your sponsor) along with the people in the same line in the levels above you. The upline is the person who brought you into the business and his/her upline is also part of yours. They all will receive a percentage of your sales, what will enhance them to recruit more consultants.
For the system to run well, these two categories of people have to be there working together. It is the responsibility of the upline to help the downline understand the business and guide them to the success.