Starting Your Referral Business

marketing sales Feb 21, 2022



Referring a Vendor or Venue can be a great asset to your business. Did you know that most Planners/Coordinators get a commission or a referral fee for recommending another business?  You can make quite a bit of money doing this.  The national standard rate is 10%-40% of the referred business's sales and that can add up quickly. 

Developing a referral program is a great way to increase your profits and if you are considering this as an option here are some things to think about.

Doing The Right Thing

When you are giving a referral, you can put yourself in a tough spot.  If you have committed to your client to do the best thing for them and you know they are on a tight budget, you may be tempted to serve your own best interest instead of by recommending a more expensive service because you know you will get a higher commission.  If you are a DOC and just provide a list of recommended vendors and they choose their own, then you are free from this issue.  If you are a Full-Service Planner and their budget is your responsibility, then this could be a problem.  You need to keep in mind your consideration should be in their best interest first.


You may be wondering how do I approach someone to give me a referral fee?  It is simple, you can just reach out to them and let them know you have a referral program and would like to know if they are interested in being part of it.  Make sure if you are going to do this that you actually have one in writing. 

Who should You Recommend?

You do want to be careful to either only recommend people you work with and who have done a great job or that you have done research on and have great reputations in the business.  Remember that there is some responsibility that will fall on you for providing the recommendation.  If you plan to just hand out a referral list, consider putting a disclaimer on the bottom stating that the list is for their convenience only and that you are not responsible for the service the vendors provide.

Return The Favor

Don't forget that the road goes two ways.  There can be a bunch of Vendors and Vendors who will recommend you as well.  If one recommends you, it would be a great idea to provide them with a commission as well. If you start to think about not wanting to give a portion of your sale to them, realize they probably have had the same thoughts.  This is a business where you need to work together with others and realize that when someone recommends you, it takes some of the "sales" pressure off of you because the couple is coming to you already feeling as if they will most likely book you because someone they trust has sent them to you and that is worth a commission.  

A Different Perspective/The Way I Did It

Now if you feel uncomfortable taking commissions or you are just not sure about it.  You could do what I did.  Instead of taking a commission, I asked the Vendors and Venues to turn it into a discount for my clients.  This was a great part of my sales presentation because it meant that I could save them thousands of dollars, I could get them great deals on vendors or vendors that they couldn't otherwise afford. 

I felt this gave me an edge over other planners and make me a much better option when they are shopping around for other planners.  

It also seemed to me that the Vendors appreciated it more as well.  They knew that I was not lining my pocket and they spoke more highly of my service.

The other thing that I think really helped me was that I could stay objective.  Because I wasn't getting a commission from them, there was no reason for me to look the other way if they didn't provide an excellent service. You see they weren't buying my loyalty and they couldn't consider it "hush money" either.  They gave the discount directly to my client and I had no direct benefit from it. 


One of the things I love most about this business is the fluidity it has.  You can create one program and if it doesn't work for you, just send a notice out to all your contacts and let them know you are making adjustments to service your clients and your vendors better. Try out your preferred way and make changes along the way until you find the perfect fit. 

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