Biz tip of the week: Generate referrals and build on them

Last week we talked about how referral business delivers high close rates and better profit margins. It sounds great, but how do you build your business by referral?

Building your referral business is a two-phase process. The first phase is focused on building strategic partnerships.

Every business has many possible strategic partners. Strategic partners are professionals in related fields who often provide services to your target market. Because you are well connected to each other’s clients, you can refer significant amounts of business to each other on a consistent basis.

Imagine a business that sells products and services to other business owners. Good strategic partners would be commercial realtors, leasing companies, business attorneys, CPAs, business consultants, staffing agencies and many more.

Make a list of the professions which are your best referral sources. Once you know who they are, design a marketing strategy to reach them. Look for them at different events, find and engage with them on social media platforms and build relationships with as many of them as you can.

Back to homepage

Subscriber Login

Keep reading with a digital access subscription.

Subscribe now

Before you build strategic partnerships, be sure you have systems and processes in place to provide exceptional service. Once the relationships begin and referrals start to come in, you have to take exceptional care of those clients. Strive to make your referring partners look good for referring to you.

Phase two begins after you have established several strategic partnerships and the referral business is flowing nicely. The second phase involves turning your client base into referring partners.

Make a conscious effort to teach your clients how important referrals are to you. Put a note about how much you appreciate referrals on your business cards, invoices, websites and other marketing materials. When someone sends you a referral, let them know how much you appreciate it with a handwritten note or personal phone call.

Once you have a strong base of referring partners and a large percentage of your clients are referring business to you, you are well on your way to building your business by referral.