The $25 referral system

doDerek works as a general contractor, but there is nothing general about his work. He specializes in basement and bathroom renovations.  A young and delightful couple hires Derek to renovate their home. Derek does a splendid job for the couple – Tammy and Andre, and he gives them an invoice payable within 10 days. 10 days pass by within no time. Soon 20 days fly by and Derek sees no payment forth coming. When a month goes by and Derek hasn’t heard from the young couple yet, he gives them the dreaded collection call.

When Tammy picks up the call, Derek reminds her in a calm yet firm voice that their payment is past due. Tammy is very apologetic and embarrassed about the missed payment. Tammy apologizes, almost to the point of groveling, and asks Derek to come over immediately to collect the cheque.

Derek feels that he might have been rather strict with Tammy over the phone. He feels rather bad about her groveling. On his way over to their home, Derek buys a good bottle of wine for the couple. The wine costs him $19.95. Feeling generous, he buys a red bow and a “Thank You” card too.  Derek writes a hand written thank you note in the card: “No hard feelings. Enjoy your new home improvements and if you know of anyone else who wants work done on their home, please give them my card”

Derek than takes out 5 of his business cards, writes Tammy and Andre’s name at the back of the business cards and inserts them in the “Thank You” card.

The generous gesture costs Derek about $25. But the look on Tammy’s face when he gives her the wine and Thank You card is priceless. Her demeanor instantly changes from “embarrassed by the late payment” to “elated”.  But the icing isn’t Tammy’s thousand watt smile. Since then, Derek has received 4 of those 5 business cards back from other people who were referred by Tammy and Andre. Derek’s gross revenue is easily over $100,000 from the referrals!

 Action summary:

 °    Always act at your best. Derek could have easily been harsher when the payment wasn’t made in 30 days. But his generous act made him a hero. His generous act made him remembered. His generous act gained him 4 referrals that spent $100,000 with him.

°    Write Thank you notes. Thank you notes surprises your clients as hardly anyone else sends them. Old- fashioned politeness and respect is so uncommon these days that when practiced genuinely can be a great marketing tool.

°    Have a referral system in place. It could be as easy as giving your business cards to your satisfied clients to pass around.