Why I don’t charge client referral fees
Sure, I could charge a referral fee and be more transactional about it. It’s just not my style.
A good friend once referred a prospective client to me who needed help with a small project. We were both designers and I had just started my business, whereas she had a job and didn’t want to take on any extra work. However, this small project led to a long-term client relationship with whom I collaborated on some of the highest-paying projects of my career. These were projects that helped me pay my bills and save up for a downpayment. Years later, I was able to return the favor to that friend when she started her own company. Even though she was running a competing business, I shared everything I learned about entrepreneurship, along with all the business and creative resources I had.
Why? Because some things are more valuable than money:
Loyalty. Integrity. Collaboration.
People have told me I should charge a referral fee to “get something” in return for the favor. But I am. It benefits me to be a team player, even if I’m helping out another team. I only passed on new business if my team was booked solid, or if I no longer took on that sort of project. So really, any company I referred business to was doing me a favor by taking on the client and doing a great job for them. This is why I have never charged a referral fee. I just choose to pay it forward.
However, these relationships are not so easy to build. When I was at capacity and began turning away the types of projects I was no longer interested in, I expanded my network so this overflow of potential business wasn’t left hanging without a service provider. One of the companies I reached out to said they were interested in receiving my client referrals, but they weren’t interested in actually meeting with me. I decided against sending prospective clients their way and, unfortunately, a couple of years later I saw they had gone out of business.
I see this as a valuable lesson in relationship building. Business can be unpredictable at times, and this is why building relationships is just as important as seizing the opportunities immediately in front of us. In the end, my decision not to charge referral fees boils down to more than just a transaction. It’s about fostering genuine connections, being a team player, and being true to the meaning of the words written above — loyalty, integrity, and collaboration.
