What will I be doing?

If you’ve ever needed help finding someone to perform a service, you know how handy it would be to have a single source to call—a referral service.

If you’re one of those people that others call for referrals, you may be able to offer your networking knowledge to others for money without leaving home. You can start your own referral service.

A referral service finds, qualifies, selects and promotes businesses that meet a specific business criteria or ethic. A referral service recommends and refers potential customers to businesses and associations for various services.

Some examples of successful referral services can include home repair, auto repair, medical or dental services, spiritual centers and restaurants, to name a few.

What will I need to start?

A referral service is paid for knowledge of resources. The more knowledge and resources you have and the more valuable they are to your customers, the more you will be paid.

Referral services typically specialize in the needs of a specific group of customers. One may offer industrial contacts to foreign buyers. Another referral service may check out and refer travel services to corporate customers. A third service will help new people in a community find qualified doctors, dentists, attorneys, real estate offices and other professional service. You’ll most likely choose a specialty that matches your own background and experience, or in an area that is of special interest to you.

Who will my customers be?

Your customers are a group of people that need specific services. They may be defined by their industry, their job or where they live. They all need information they don’t have time to gather. They need someone trustworthy to help them find other trustworthy people and resources, and that is where your services will be essential.

Once you’ve decided who your customers are, finding them will be much easier. A service ad in a local newspaper can promote your handyman referral service. A brochure to restaurants can promote your service of finding and referring the best restaurant suppliers.

How much should I charge?

The hourly rate for referral services ranges from $25 to $50. Your pricing will be based on the time required to develop your referrals, but more on the value of these referrals to your customers. If your customers will save thousands of dollars by using your referrals, charging a few hundred dollars will be reasonable. If you’re simply referring a plumber to a homeowner, your fee will be less because the value is less. In some cases, the fee is paid for by the resource.

How much will I make?

Contacts will be everything in this business. Once you’ve developed qualified contacts in your field, most of your time will be spent on offering these resources to customers. About 20 percent of your time will be needed for promoting your services.

Expenses for a home-based referral service are typically 20 to 40 percent of income. This covers your office expenses, telephone and taxes. As your home-based business grows, you can focus your attention on customers and services that bring you the greatest profits and satisfaction.

How can I get started?

To start a referral service, pick a service and a group of customers you enjoy working with and who need your skills. Then talk to people in this group to learn what they need and how you can help. Ask them what a good referral is worth to them. Remember to ask your resources if they would pay a finder’s fee for your referrals.

Finally, start small, help a customer or two and learn. When you’ve defined your market and services, produce a flier that you can circulate to potential customers.

How can I use computers to increase profits?

Knowledge is power. This is especially true to those who make money referring people for a fee. The more you know the more you can make. Computers and the Internet offer a vast world of knowledge to help you match needs and resources. Learn to use the Internet as a research tool as well as a communications tool to keep in touch with clients and resources.