Clever Counsel #20 - 3 Ways to create referral partnerships
Establishing referral partnerships with fellow consultants and small agencies has been a major part of my business strategy over the years. The benefits are obvious:
passive side income
supporting and helping others
expanding my network
Yet despite the upside, I’ve found I’m in the minority when it comes to my approach.
Most consultants seem to feel unsure about asking for referral fees or establishing these kinds of mutually beneficial arrangements.
And I get it, it can seem “icky” to ask for money - especially from a colleague or friend.
To help make this process feel doable, I’d like to share three different approaches to creating referral partnerships, with some template messaging to get you started.
WHO TO ASK
Look for independent consultants and small agency owners in your personal network, industry communities, and LinkedIn connections. Many different types will fit the bill:
They could work for clients similar to yours, but providing a different type of service (i.e. internal communications vs external communications, or internal communications vs human resources consulting)
They could work for clients doing exactly what you do, but at a different scale (i.e. an agency with a minimum monthly retainer of $5000 vs a consultant happy to take on smaller projects)
They could even be “doppelgängers” who do exactly what you do, for exactly the same type of client. After all - they’re only one person. They’ll inevitably have overflow from time to time.
3 WAYS TO APPROACH
1 / Flexible
Hey, I have an idea for how we could collaborate. How would you feel about setting up a referral partnership that could pay off for both of us?
Here's how it could work - if I make an introduction to a contact in my network, either just for the purposes of networking, or related to a current need - you throw me a little kickback if you end up booking work with that contact. Could be 5% to 10% of your project fee, or a flat referral fee you feel comfortable offering. I'll of course do the exact same for you.
I have these arrangements set up with a couple of other consultants and it's been a great way to expand our opportunities and make a little side income too. What do you think?
2 / Firm
Hey there, I have a quick proposal to share with you. I know I'm always thrilled to share referral fees with contacts who make introductions for me. Is that something you're open to exploring as well? Here's how it would work: I'd share a one-pager agreement to outline the terms of our partnership, and then once signed we'll both be on the lookout to make introductions for each other. When work comes in for either of us (thanks to that initial introduction), the referring partner would make 10% of the project fee. As I'm sure you know, this percentage is industry standard for these types of partnerships.
Let me know your thoughts and happy to send over my standard referral agreement for review! This could be a great new pipeline for both of us.
3 / Friendly
Hey! I'm eager to expand my network to bring in more potential consulting opportunities - and I bet you feel the same. How about we set up an informal referral partnership? No exchange of money, just sharing introductions with each other.
Here's how it would work: We'd discuss the kinds of contacts we're both trying to meet, and then we'd both spend a little time each quarter looking at our respective networks and making personal introductions using some template copy we each provide. Keep in mind that our contacts don't have to have current needs for support - this would just be for the purposes of networking. Every new contact I bring your way, you do the same for me. One for one.
I have these arrangements set up with a couple of other colleagues and it's been a wonderful way to grow my network of potential leads. What do you think?
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I encourage you to try out one or two of these approaches in the weeks ahead. And if you’re still feeling hesitant, feel free to tell your new referral partner that Ashley Dennison counseled you to try this out. Point the finger at me - I don’t mind a bit. 😊
