"So what should I charge?"- Tommy's question
Tommy is a connector. He knows a lot of people and is in a position were he can offer a connection to someone looking to grow their business. Tommy knows people who know people.
The other day we had a conversation and he wondered out loud what his services were worth. It was an excellent question. Compensation for an introduction would be different than compensation for future business.
After some thought I came up with:
fees= IntroductionFee + Percent*(FutureBusiness)
The introduction fee should be enough to not fee like a demand but a reward. The way I see it that the one person you are connecting is looking to expand their business and should be willing to reward you for the introduction. A good number? $500 is an acceptable fee in my mind.
The future business is the potential business that could result from the introduction. This number as well as the Percent that are acceptable create the biggest challenge If the business will earn 1M new business then 2% is not unreasonable.
Putting it together for a situation where an introduction would lead to 1M on new business is:
fee=500+.02*1000000
fee=500+20000
fee=20500
If they meet but do not end up doing business then $500 is the fee. If they do more than 1M then the Percent*FutureBusiness portion grows.
Today's question is:
"How valuable are your connections?"
Tommy is a connector. He knows a lot of people and is in a position were he can offer a connection to someone looking to grow their business. Tommy knows people who know people.
The other day we had a conversation and he wondered out loud what his services were worth. It was an excellent question. Compensation for an introduction would be different than compensation for future business.
After some thought I came up with:
fees= IntroductionFee + Percent*(FutureBusiness)
The introduction fee should be enough to not fee like a demand but a reward. The way I see it that the one person you are connecting is looking to expand their business and should be willing to reward you for the introduction. A good number? $500 is an acceptable fee in my mind.
The future business is the potential business that could result from the introduction. This number as well as the Percent that are acceptable create the biggest challenge If the business will earn 1M new business then 2% is not unreasonable.
Putting it together for a situation where an introduction would lead to 1M on new business is:
fee=500+.02*1000000
fee=500+20000
fee=20500
If they meet but do not end up doing business then $500 is the fee. If they do more than 1M then the Percent*FutureBusiness portion grows.
Today's question is:
"How valuable are your connections?"
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