Consulting Referral Fees: What’s A

Consulting Referral Fees: What’s A Typical Finders Fee For Consultants?

A consulting referral fee (also known as a “finder’s fee”, but I don’t use that term) is a fee you pay someone who refers a consulting client to you.

For example, imagine that you share a case study on LinkedIn about a successful project you delivered for your client.

A colleague of yours sees your post and thinks of someone in their network who would benefit from your expertise.

Now imagine that you and this colleague have a referral arrangement in place.

They make this introduction and refer this person to you. That person becomes a client.

Based on your referral arrangement with your colleague, you give them a small percentage (5-10%) of the project’s overall fee, thus rewarding them for sending you the referral — and incentivizing them to send you more referrals.

In the world of consulting, this type of deal is quite common.

It’s a way of getting your network to help do your marketing, and refer clients to you because they make money simply by referring people to you.

However, as you’ll see below, this isn’t always the case.

In this article, I’ll break down…

Now, before we dive in I want to make one thing very clear. This is not financial or legal advice. I don’t know your specific situation and can’t speak to every possible variation.

Different places may have different laws and regulations on this so it’s always good to get feedback on your specific situation.

With that out of the way, let’s dive in…

Would you rather spend $3000 in marketing to land a client, or would you rather pay someone a $500 referral fee to refer you a client?

Should You Pay A Referral Fee?

There’s no right or wrong answer for whether or not consultants should pay a referral fee.

The choice is up to you, your style, and your unique consulting business.

Some consultants don’t pay referral fees, nor do they expect referral fees when they send their own referrals. They prefer to keep the relationship neutral, without any financial incentive for referring business. They don’t want to be biased or influenced by money.

Tue Oct 03rd 2023

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