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#157395 - 10/31/05 10:13 AM Thanking "competitors" for referrals
VinceR Offline
Member

Registered: 04/24/05
Posts: 35
Loc: Edgewood, WA, USA
We are a small service focused res shop who have been getting a fair amount of referrals from the bigger shops who are so busy now that the don’t want to chase the smaller jobs that are our bread and butter. We have a good reputation locally for realibility, fair pricing and quality work so the seem to feel good about referring us. My question is should we do anything to formalize our referral relationship. I have the urge to stop by and thank these shops and give out a “Starbucks” card or something to show that we appreciate their confidence in us. My question is addressed to those of you in larger shops: Do any of you refer business you don’t want to others? If so what do you think is would you consider an appropriate “thank you” from the shop you referred business.

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Business, Office, Estimating, Legal:
#157396 - 11/01/05 04:08 AM Re: Thanking "competitors" for referrals
Dnkldorf Offline
Member

Registered: 12/12/04
Posts: 1091
Loc: nowhere usa
Cash is always a crowd pleaser...

Dnk..

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#157397 - 11/01/05 09:26 AM Re: Thanking "competitors" for referrals
electricbill Offline
Member

Registered: 02/19/05
Posts: 20
Loc: chester ny usa
stop by and thank them...it shows that you appreciate the referal,and that the people they send to you ARE going to you...
bill

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#157398 - 11/01/05 06:56 PM Re: Thanking "competitors" for referrals
Jps1006 Offline
Member

Registered: 01/22/04
Posts: 609
Loc: Northern IL
Cash can be a crowd pleaser, but not always appropriate.

"happy anniversary honey, here's 50 bucks."

Okay, the relationship between you & your competitor and you & your wife might be a little different, but getting the cash into the right hands might be tricky.

I'm a small shop so I can't advise from that perspective, but if it were me I'd be concermed about two other issues. If I did stop by, would I be bothering someone who is also too busy to hear a thank you. And what if it is not well known throughout the company that your name is being given out? Not saying either scenario is likely.

All in all I think it is worth the risk to go with the Starbucks idea, but I'm still curious to see what others think.

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#157399 - 11/02/05 02:51 AM Re: Thanking "competitors" for referrals
Electricmanscott Offline
Member

Registered: 01/12/02
Posts: 1478
Loc: Holden, MA USA
A few gift cards seems reasonable. I might worry about them expecting something on a regular basis though. Not likely but you never know. If it were me I think I would just go with a simple thank you phone call.

PS, Not everyone drinks coffee.

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#157400 - 11/02/05 03:52 AM Re: Thanking "competitors" for referrals
Dnkldorf Offline
Member

Registered: 12/12/04
Posts: 1091
Loc: nowhere usa
I don't like Starbucks at all...
But that's me.

The reason I stated cash, because it allows that person to treat themselves to what ever they want. They pick it. And you don't look or feel bad purchasing something they don't need or like.


I have yet to find someone who doesn't like, or better yet, rememmber cash.

But if you know the person you are dealing with, and know what they enjoy, something other than cash, could be more personable.

Dnk....

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#157401 - 11/02/05 07:08 AM Re: Thanking "competitors" for referrals
VinceR Offline
Member

Registered: 04/24/05
Posts: 35
Loc: Edgewood, WA, USA
All, thanks for the good thoughts. I especially like Jps1006 “the relationship between you & your competitor and you & your wife might be a little different…” I can assure it is VERY different.

Perhaps a bit more background then a question on taking this discussion to a much higher level.


The relationship between us started innocently enough. We all operate out of a small community on the edge of a larger city. We (the owners) got to know each other by being members of the same community organizations (Kiwanis, Chamber of Commerce, etc.) We would discuss common areas of interest – how’s business, problems with inspectors, etc. After a while, it became obvious that we really after the same markets – they do tract and upscale custom homes, we are focused on consumer service. That is when the referrals started coming. It has been good for us – it does not hurt your reputation than having another electrician tell them you are good. I don’t think it hurts them since they it was work they were too busy to take.

My question: Would it make any sense to approach the owners with a proposal that we would give them a referral fee based on size of job number or referrals per month, etc.? Comments? Warnings? Thanks

VinceR

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#157402 - 11/02/05 08:36 AM Re: Thanking "competitors" for referrals
Electricmanscott Offline
Member

Registered: 01/12/02
Posts: 1478
Loc: Holden, MA USA
Let me get this straight. They are giving you referals for free right? You would like to propose paying them for the referals? Are you nuts?

Here is what you owe them. Take care of the customers they send your way. It makes you both look good. If you do not it will reflect badly on you and them.
Stay feindly with the owner and thank him for the work. That's it.

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#157403 - 11/02/05 12:46 PM Re: Thanking "competitors" for referrals
Dnkldorf Offline
Member

Registered: 12/12/04
Posts: 1091
Loc: nowhere usa
Vince, call me crazy, but what you described has merger written all over it.....

Multiple Contractors in the same market, all with seperate overhead, tools, materials, ect?

You guys are referring each other to each other?

Join forces and make it happen...

Dnk....

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#157404 - 11/02/05 01:54 PM Re: Thanking "competitors" for referrals
DougW Offline
Member

Registered: 06/08/03
Posts: 1083
Loc: North Chicago, IL
I think a "thank you" at least would be appropriate.

I don't think I'd jump straight to payment for referrals - it could lead to an expectation.

Send 'em 2 "box-o-coffee"s, two dozen assorted donuts, a box of bagels, a thing of cream cheese, and a dozen assorted muffins just before start time - that way, everybody should find something they like, and a "thanks for the referrals" note will let them know why.

ETA - and a "box" of hot chocolate, for the non-coffee drinkers

[This message has been edited by DougW (edited 11-02-2005).]

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