by Chris Goldman
Business networking and partnerships may be service businesses’ most valuable, untapped revenue sources. But networking takes time and energy most business owners believe they don’t have. That’s why most significant leadership minds have emphasized this in their writing and speaking. For example, marketing guru, Porter Gale says, “Your network is your net worth.”
It’s important to note that networks and partnerships are two different things. Dr. Ivan Misner of BNI defines business networking as, “…the process of developing and activating your relationships to increase your business, enhance your knowledge, and expand your sphere of influence.” You’ll notice the emphasis on personal benefit to you or your company.
Partnerships take network connections to a whole new level. While some partnerships can be legally established and legally binding, for our purposes in this article, a business partnership takes place when local network connections decide to cross-pollinate for the benefit of all parties involved.
A local veterinarian has their clinic down the road from a locally owned pet store. They have been connected by a pet groomer who has dropped off business cards at both sites and attended a networking event together. The veterinarian recommends a premium pet food brand not found in most pet stores. She asks if the pet store owner could begin to carry that food so owners could be sent there to get the food. The pet store owner says, “I’d be glad to and even allow you to offer a 15% introductory discount for your patients if they bring in our referral card.”
This gets all three business owners thinking. What if the three pet-oriented businesses begin to intentionally refer each other and build stronger business relationships with local families? This leads the three to send out a marketing postcard featuring all three businesses. Because they share the costs, everyone wins. They also agree any new business gained through the mailer will be tracked and all new customers will – in kind – be referred to the others with favorable introductory discounts.
A commercial real estate broker joined a networking group that also had a building inspector and loan officer in the group. All three were representatives of much larger companies. This hampered their ability to enter into formal partnerships. However, they decided to focus on referrals to one another and intentionally help build each other’s businesses. This led to the completion of inspections that were holding up the finalization of sales. The loan officer was – in turn – able to give unbiased financial insights to the clients. In the meantime, referrals began flowing between all three.
Partnerships are born out of trusted networks. However, partnerships require stepping beyond simple networking and joining hands to build each other’s businesses through referrals, marketing collectively, and investing time to consider how all partners could benefit in real terms.