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.
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.
Re: Thanking "competitors" for referrals#157399 11/02/0505:51 AM11/02/0505:51 AM
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.
Re: Thanking "competitors" for referrals#157400 11/02/0506:52 AM11/02/0506:52 AM
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
Re: Thanking "competitors" for referrals#157402 11/02/0511:36 AM11/02/0511:36 AM
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.
Re: Thanking "competitors" for referrals#157403 11/02/0503:46 PM11/02/0503:46 PM
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).]