Finders fee for referrals

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Matt Cardoni

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A local auto electronics shop contacted me about detailing for them. They currently do it in-house, but are looking to sub it out. We would like to have an arrangement where they just refer the customers to me directly and I would pay a finders fee to them. Does anyone here have an opinion on a fair number, probably a % of the job price? We discussed options of paying a larger fee for the first job, then any repeat business would have no fee. The other option is to pay a smaller fee each time the customer returns.
 
Keeping track of every time a customer returns would be a nightmare. Are they booking the customer for you? Because then you've got the scenario where they think a customer went to you and you owe them a fee when in fact the customer never showed, etc.
 
Not worth it unless they are doing all the leg work. Like Setec said, it would be tough to keep track of. I have several shops that I do work for, and if they want to make money off the detail they can tack something on to my price to the customer. As long as I'm getting paid what i want, I don't care.

In those situations though, I am getting paid by the shop, who is in turn charging the customer. So again, they do all the booking and talking with the customer. If someone is just handing out your cards, I don't think they really should be getting a fee.
 
I would just offer a discount on details for the electronic shop's owner(s)/employees, and nothing more.
 
I would give the suggestion that you pay them a certain percentage say 15% for each client for the first time they show up, after that... you owe them nothing. The client would not come back or want your services if you did not do a good job. The other company pointed them to you, you did the work and you were the one that satisfied them with the work.

Thing though is the other company might not like that as they are obviously looking to create revenue for themselves with lightening their load.

Whatever you do, do not settle for something your not comfortable with. Otherwise whenever one of those referred customers comes in you will not only be annoyed with doing the work but your quality might drop and you might loose other potential clients.
 
No finders fees for me. If they would refer someone to me then I would return the favor when one of my customers is looking for the services they offer.
 
Matt Cardoni said:
A local auto electronics shop ... currently do it in-house, but are looking to sub it out.
Click to expand...

Sounds like they are in over their heads and are looking to limit their liabilities and are planning to concentrate on what they do best...electronics.
 
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