Four Referrals…

 I was asked by a new member recently how many referrals they should hope to receive in the coming year.

The first thing I said was ‘…have you time for a coffee?’ And, they replied, ‘Of course, but why?’

Well, this is part of what we talked about.

How many referrals would they need to get? But, as important, even more important, was how many referrals they were going to give? Givers Gain, BNI’s core value, is giving to others, before expecting anything from others. Giving first and getting second.

But, let’s get back to what they wanted to know. How many referrals would be a good return? The answer is pretty simple to work out but many members have never done the maths.

The first thing to do is to work out how much business you would like? This should be based on your money invested: BNI membership, venue costs, transport costs, etc. and, of course, time. As an example, let’s say £15,000.

Next we need the average value of your orders. If you don’t know that, just divide your turnover (no VAT) in a year by the number of invoices sent. Again, for example, let’s say £68,000 divided by 120 invoices; answer £568.00.

Okay, now divide the £15,000 by £568.00; answer 26. So, you need 26 jobs to make your £15,000. But, that’s not referrals; because now, you need your conversion rate. How many estimates do you give to receive a job? Let’s say it’s three. Therefore, 26 times three equals 78; which means you need 78 referrals per year to reach your £15,000. That’s 6.5 referrals each month.

The new member and I worked this out for him and, oddly, the number we worked out for him was the same number I have. One referral needed each week to reach our goals.

So, do you know the number of, qualified, referrals you need? If not, why not work it out? I promise you it could be very worthwhile.