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Thoughts on charging for referrals?

I'm taking a two-month leave of absence due to my husband's job, and I'll be referring my clients to a couple of colleagues. Do you think it's appropriate to ask these therapists for a small per-client referral fee? I'm thinking $5 per client, which is less than 10% of the massage price.

My thought is that I've put in a great deal of time, effort and money marketing to and retaining these clients, and the therapists have to do nothing but take the appointments. This would help me cover my rent and other expenses a bit while I'm gone.

Is that appropriate or just petty? I've never run into this situation before.

Thanks!

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Permalink Reply by Felicia Brown on July 26, 2009 at 2:09pm

Hi Julianne -

Is there a therapist that could see the clients in your office (like an independent contractor) for a percentage of the fee? Then after your return they could stay on to help you share expenses or cover for you if anything like this comes up again. To me that seems the easiest way to get a referral fee and to keep contact with the clients that you have seen for so long. I actually do this with a couple of therapists who work as independent contractors in my office if I am sick or unable to work for some other reason and it works pretty well.

If you will not be in the area, then perhaps you could try negotiating a fee with therapists you know and trust. I would start out by asking a higher amount per session (20% perhaps) so you have room to negotiate to the fee or commission you can both live with. However, unless you book each appointment for each client/therapist yourself, it will be hard to know who is seeing whom and how much they actually owe.

I don't think the situation is petty at all but must be thought out in advance for contingencies such as discounts you offer, special needs of your clients, and gift certificate payments as well as how you will collect payment for the referrals.

Hope that is of some help!

Felicia

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Permalink Reply by Gloria Coppola on July 26, 2009 at 5:57pm

I feel Felicia gave you great advice and I totally agree with her point of view on this

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Permalink Reply by Elena Barrioz on July 26, 2009 at 6:01pm

I wonder if a good question to ask is, how would you feel if a massage therapist came up to you and asked "Would it be ok if I referred my clients to you, oh and by the way, I would like to be paid a referral fee if they do come in and receive a massage from you."

I personally feel that referring out is a goodwill gesture and I would not expect anything in return accept a Thank You for thinking of me. If I were asked to be on the referral list for a fee, I would turn it down.

But as Julianne stated, if you actually have someone come into your office and sees your clients, that would be seen as a business arrangement and records could more easily be kept, as you would be dealing with just one or two other therapists instead of many. If I were asked in this fashion, I would most likely accept.

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Permalink Reply by Julianne on July 26, 2009 at 8:37pm

Hi again!

Thank you for your input. Allow me to clarify...

I will not be in town during my leave of absence, and I arranged to have my lease end just before I leave. Therefore, the two therapists to whom I'll be referring my clients will be seeing them in their individual offices. I'll be coming back to a new office in a new location, not working directly with either of the therapists except as trading partners again.

Does this make any difference in your opinions?