Meeting with a commercial real estate attorney tomorrow who wants to refer clients for utility audits. He's asking about a 10% referral fee on any projects that close. What's the standard referral rate in this industry?
Referral fees from attorneys and CPAs
I pay 10% to attorneys and CPAs in Spokane. Usually structure it as 10% of first year fees only, not ongoing. Make sure you have a written referral agreement that complies with your state's rules about referral fees.
Be careful with referral fees. North Dakota has strict rules about fee splitting with non-licensed professionals. I just do reciprocal referrals - I send tax clients to the CPA, they send audit clients to me. No money changes hands.
I've built great relationships with 3 CPAs in Memphis by offering value-added services instead of fees. I provide their clients with free 15-minute bill reviews during tax season. Generates goodwill and often leads to full audit engagements.
Paying 8% referral fees to two business brokers here in Lubbock. When they're working on selling a commercial property, utility savings can increase the property value. It's a natural fit and both sides benefit.
Thanks for the input everyone. Decided to start with reciprocal referrals and see how it goes. The attorney specializes in commercial real estate transactions so there should be good synergy.
Just started working with a business attorney in San Diego who refers distressed businesses. These clients are highly motivated to reduce costs. Converting at almost 90% vs 60% for cold leads. Quality of referrals matters more than quantity.
Focus on building genuine business relationships rather than transactional referral arrangements. The best referral sources are professionals who understand your value proposition and have clients who genuinely need your services. Quality partnerships beat paid referrals every time.