Dealing with Sales Referrals Effectively

Scott Calonico

men shaking hands Ask any business owner, and they will tell you their favorite type of prospective client is one who has been referred to them.

Typically, a sales referral comes across to you from an existing client, colleague or strategic alliance partner who knows, likes and trusts you. By referring you to someone else, you’re immediately being given the seal of approval - and that goes a long way towards helping you winning the new business.

Many growing businesses go seeking referrals - but just as many referrals are given unsolicited, and often introductions of this nature are made via e-mail for the convenience it offers in sharing contact details and the nature of the referral.

How do you deal with sales referrals?

So if you’re the recipient of a referral - how do you typically deal with that referral?

For most of us, we understand the need to respond in a timely fashion - to let the referral know who we are, and how they can take the conversation forwards.

Most of us also understand the need to communicate and in a warm and welcoming manner - to both the referrer (the person who is making the introduction) and the referral (the person who is being introduced to you).

Don’t drop the ball!woman juggling balls

But while all may seem like common sense, I’m continuously surprised by the number of people who seemingly drop the ball on referrals at some stage. It can be something as simple as forgetting to say thank-you to one of the parties involved, making assumptions about the work being a “done deal” or in some cases, not responding to the referral at all. There’s no surer way to ensure you don’t get any future referrals than to mess up an existing referral!

So here are my tips for effectively handling a referral, and ensuring that you receive many more of the same.

Receiving the referral

When you receive a referral, telephone the referrer to say thank-you as soon as possible. Doing so demonstrates you value their time and effort making the referral. You can also use this call to gather any more background information on the referral.

Following-up with the referral

Follow-up with an e-mail copying in both the referral and the referrer in a timely fashion. Thank the referrer again for being kind enough to think of you, and ask the referral how you might be of help. In this e-mail, for the benefit of the referral, also include your full contact details, suggest that you connect up via LinkedIn (so you can let the referral do a bit more background checking on you) and ask if there is any convenient time that you could give them a call to discuss. At this stage you want to give the referral further info about you but without being too pushy.

Developing the conversation

The conversation between you and the referral will probably then develop. At this stage, politely thank the referrer again and advise you’ll let them know how the discussion goes. The referrer will want to know how things turn out, but they probably don’t want to be privy to the entire conversation - so don’t CC them in on every e-mail!

Don’t assume the business is yours!

Take the conversation with the referral forward, treating them as you do with any other prospect - professionally and with respect. A referral typically is much more likely to do business with you than any other type of prospect, but don’t make assumptions! The business isn’t yours just yet!

If you don’t win the business

If the referral turns out not to be a good fit to work with you - perhaps you charge more than the referral was looking to spend, or you simply don’t provide a service that the referral actually wanted - remember that you’ve still got a chance to demonstrate your value here. Value that will be echoed from the referral to the referrer. Help the referral find someone else who can help them (thus creating a new referral!), send them a web article or blog that they will find useful, and offer to stay in touch in case you’re able to help further.

Finally - always remember to say "Thank-you!"

Finally, regardless of whether the referral turns into business or not, follow up with the referrer and let them know how the conversation went. At this stage I like to send a small thank-you gesture - even if it’s just a handwritten note to let the referrer know I appreciate them thinking of me.


A referral is the strongest type of business prospect you will encounter. In many cases, the business is often yours to lose. But if you don’t treat the referral with respect, and forget to communicate and thank the referrer, these mistakes can quickly mean a valuable source of referrals drying up.

By following the simple steps listed above, you can ensure that you’re receiving a steady stream of referrals throughout your business life.

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As the former owner of an award winning IT Managed Service Provider, Richard Tubb works with MSPs to help them increase sales, take on employees and build up relationships with key industry contacts. You don't have to do it alone any more - contact Richard and have a chat about your needs and how he can help you.

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