Referral rates

[weevil68]

Hi
does anyone have an idea on what a good referral rate is?

I get a lot of clients who ask me to recommend people in different trades-I think it's fair if I ask for a referral fee but have no idea whether to ask for set fee or %.

I know I'd be happy to pay if the situation was reversed but have,in the past,been asked for anything between £25 and 20% of job price.

 

[swiftpete]

I'd rather a set fee than a % rate personally. How much to ask for is hard to say, I would pay £20-30 for referrals and not worry about it as I'd probably just add it on to the price of the job.
The way this is usually done though is the price is not really set out beforehand. If you're recommended by someone and get the job because of their recommendation, then you might give them 'a drink' out of it. How much that would be would depend on the price and size of job though.
You could keep it informal and if the tradesmen you recommend aren't generous enough, then just start recommending others that give you enough to make it worth your while.

 

[RevaxMedia]

15% would sound fair, depending on the size of the job.

 

[estwig]

The question is impossible to answer, far too many variables. Like the value of the work to start with.

 

[Beachcomber]

Referral fee?
What are you? An estate agent?

If I get a job come along that I can't fit in or is beyond my skills (gas fitting / cert electrics etc) then I pass it on to one of a group of trades I know and trust to do a good job for a fair price.

They in turn do the same and pass work my way.

When you meet in the pub, you buy each other a pint.

Thats about as complicated as it needs to be, or do we not do favours any more? Asking for a referral fee is no better than these trades web sites that charge you for bidding on jobs.

 

[estwig]

Referral fee?
What are you? An estate agent?

If I get a job come along that I can't fit in or is beyond my skills (gas fitting / cert electrics etc) then I pass it on to one of a group of trades I know and trust to do a good job for a fair price.

They in turn do the same and pass work my way.

When you meet in the pub, you buy each other a pint.

Thats about as complicated as it needs to be, or do we not do favours any more? Asking for a referral fee is no better than these trades web sites that charge you for bidding on jobs.

I used to pass on a lot of work to other builders/trades and when I asked for a drink in return (drink didn't mean a pint, it meant something a little more), I would often get the reaction you have just described. And you are right. But I had and still do have marketing costs to generate this business, the work doesn't fall outta the sky, most tradesmen accepted this and we formed a good working relationship. Some would become indigent with comments about not paying for work, whilst they sat at home waiting for the phone to ring.

 

[Beachcomber]

I don't think I'll ever get my head around asking for something in return for passing work on.

The very fact that you are passing it on means that lead is no good to you - so any perceived marketing cost is irrelevant. If the lead is no use it's no use, weather you pass it on or not.

Passing on a job takes a 30 second phone call, thats all.
Do we really not help each other out anymore?
It's a sad day if we don't.

 

[CKG]

As estwig says the value of the work is important.

If your passing on a job to re-plumb Mrs Joneses downstairs bog no ones really making any money out of the job

But if your passing on a however many £100K+ new build/refurb/maintenance contract I think that deserves the offer of a 'drink' at the very least.

 

[estwig]

If your a chippy and you got mates who are a brickie, roofer and a spread, then great pass the business around, spread the luv.

I used to tout for work to build house extensions and loft conversions, but being a builder, people would contact me for house re-wires, new heating systems, new kitchens, etc. High value work and to pass on work like that, especially as an electrician for example is not likely to be asked about a house extension and so be able to pass work back to me. I expected a drink.

This where the OP's question is pointless without more information, about the type and value of the work.