Business referrals are the fuel that powers the business growth of alternative investment service providers such as attorneys, CPAs, real estate agents and mortgage brokers. Acquiring new clients through marketing and advertisement is relatively expensive, and it makes financial sense for service providers to focus on obtaining business through direct referrals. Many service providers unwittingly make this process more difficult by being “too busy.” Here is an exchange I commonly have with service providers:

“How are things going?”

“Good, but really busy.”

As busy as they may be—and I don’t doubt them—they may not realize that saying they are “really busy” will make me less likely to send them business referrals. It isn’t just me who feels this way. People don’t generally want to add more work to your plate if you are swamped, nor do they feel comfortable referring someone to you if they think that you don’t have the time to provide excellent service.

If you want to grow your business, you should never be too busy for referrals. Talking about how busy you are makes others less likely to send business to you, so instead talk about how you’re looking for new clients. That sends a clear message that you are ready, willing and able to take any business referrals sent your way.

Labels: referrals

Anyone who has visited Marrakesh (Marrakech), Morocco knows that it is a unique destination—and sometimes awkward for Americans. The city is packed with guides who aggressively push their services on foreign tourists. Most tourists instinctively distrust these guides, but understand that Marrakesh’s maze of streets is nearly impossible for foreigners to navigate on their own.

These guides profess to be free, but they are not. When they bring you back to your hotel, they will resort to begging and pleading in order to cajole some currency from your pocket. Even more interesting are the revenue sharing arrangements that they have with local vendors. Don’t be surprised if you end up taking detours to specific carpet shops or other stores where the tourist price is much higher than the price for locals.

This type of arrangement is not unusual in many foreign countries, but it certainly feels foreign to most Americans. The idea of someone pushing us toward a store or product for a commission seems repellant, but this same scenario takes place in the U.S. every day. It’s probably why most Americans have a distaste for salespeople and rank them somewhere between lawyers and politicians in the hierarchy of “the kinds of people we trust”.

If you want to earn trust, stop asking, “What’s in it for me?” Instead, start asking, “What will best serve this client?” Sometimes the answer will be a service or product that you provide. Other times it will not. Instead of trying to push a client into a product or service that’s not a perfect match, consider sending them to a provider that will better serve them, without expecting something in return. This not only builds good will with your clients, but also with the businesses to which you refer them. Good will leads to more referrals to you and a growing business.

Labels: commissions, referrals