Word of mouth and referrals are often a good way to get new business. But relying on them as the sole long term strategy for gaining new customers (as many small businesses do) is a risky strategy that has not born out for many in difficult times.

Joining a business network group can be a good way for sales and marketing staff to actively seek referrals, but before you fill out an application form and shell out hundreds of dollars in joining fees, be sure you check out the fine print first.

BNI can leave a business out of pocket through no fault of its own

Take Business Network International, or BNI as an example – which promotes itself as a ‘business and professional networking organisation that allows only one person from each profession to join any group or chapter’. The website says it is aimed at SMEs or sales and marketing staff in large businesses. However it has a number of fish hooks that can see a business out of membership and out of pocket through no fault of their own.

Despite its name, Business Network International claims their memberships are personal or individual. If your business pays for a staff member to join a group, and that staff member later leaves your employ, there is absolutely no guarantee that their replacement will be accepted into the same group.

BNI will not automatically transfer a membership nor refund the membership costs if they decide for any reason to reject your replacement.

What is even more absurd is that BNI suggested any claims for a refund should be taken up with the staff member who had resigned!

Is it a good return on your investment?

So before handing over your business’ hard earned cash to a commercial networking organisation, be sure it is going to be money well invested.

Don’t forget to allow for all the costs associated with being a member. At BNI members must pay for breakfasts and social events on top of the membership – and at about $20 a pop for breakfast that could be $1000 per year!.

Add to that the cost of your time (at 1.5 hours a week for meetings alone, that’s around 75 hours a year) and you need to be sure you’ll gain at least that amount back in referrals to recover your costs.

Do the rounds first

There are lots of networking groups that don’t have hefty joining fees and crippling conditions. My advice  – do the rounds first.

If you are interested in BNI, visit all the chapters where there are spaces available in your profession and take every opportunity offered to speak about your business and distribute your business cards. You can do all this without having to join!

And don’t forget to ask around – you may find its not all it’s cracked up to be.

For another perspective visit: http://bit.ly/why-BNI-sucks

Posted on April 21st, 2010 by Wendy Riley-Biddle
Filed under: General, Marketing