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Networking to increase business profits

Raising your business profile and increasing profits is a breeze, with the right networks, but networking the right way is often overlooked. Learn how to cost-effectively network.

The brief for this article was to find free ways to market your business. Networking seemed the obvious place to start. And while it’s not entirely free, it doesn’t have to cost much, and you don’t need bullet-proof confidence to get started.
Before looking at cost-effective solutions, we need to stamp out some popular misconceptions. Some people forget that networking is more than just handing out business cards and mingling at the pub. Networking is one of the necessities of growing your business, yet it’s become a dirty word. Why?
“There are a lot of people who mistreat networking and give it a bad name because they’re all about trying to get business out of it, rather than trying to think more abundantly about it,” says Carolyn Stafford, founder of Connect Marketing. “Networking is really about trying to build relationships, meeting people with shared values who have complementary businesses. It’s about meeting others so you can give without the expectation of receiving, being able to connect with other people, learning what other business owners are doing, and it’s very much about meeting people you hit it off with.”
Having built her business on networking, she is sure it is the way to grow. “I got to know thousands of business owners in complementary fields. It really is how my whole business evolved,” says Stafford. “The only thing your competition can’t emulate is the quality of the relationships you have.” It is also easier to work with people you know, like, and trust. And how’s this done? Through networking, by getting out there and meeting new people.

Network to Build Your Business

Another example of using networking to build a business is Lara Fletcher, director of LaRoo, the maker of Mocks mobile phone accessories. She also believes building relationships is essential. “I know that everyone says yeah, yeah, but it really is the key way to build a business,” says Fletcher. And she would know, having recently launched her second business—GrowCo, a website to help small businesses expand their networks. “If you have good relationships with people, then you have a really great support network. One of the hardest things about being in business on your own is that you don’t have peers at your level to bounce ideas off. If you go out and network, and build relationships with people, then you have that.”
Fletcher experienced firsthand the benefits of having a wide network when she was launching GrowCo. Needing advice on creating a survey, she turned to a close friend she met through networking, who owned her own market research company. “You’ve got to look at it as more than just something to generate sales and profit,” says Fletcher. “It’s not necessarily putting money straight into the box, but over time it will.”
Word-of-mouth from your networks also has its benefits. “With the Mocks business, a lot of people I meet might buy Mocks themselves. They’re not going to buy hundreds of thousands, but they talk to other people,” explains Fletcher, again underlining the importance of relationships. “If people hear about you, and like you, then they’ll recommend you to others.”
One of the easiest ways to build relationships and get your name out there is also the cheapest. Fletcher recommends networking with friends. “They all know about what I do,” she says. “Some of them practically hand out my business cards.”

Informal Networks

While Stafford is an advocate of spending to receive, she recommends social and informal networks for those who don’t immediately have the budget. Informal networks are those you have through personal and social interests, whether it is an art class or your child’s day-care centre. “If people are interested in what you do and vice versa, there’s an opportunity for you to do business together,” she says. “And that’s really the way the world operates.”
Another option is establishing a mastermind group. The group is made up of like-minded business owners who meet regularly and have a structured networking meeting, explains Stafford.
Those with a slightly larger budget can join an already established group. These groups have membership fees, but they often host other events as well.
Fletcher makes every effort to attend a networking event once a week or fortnight, depending on her schedule. As a member of the Australian Businesswomen’s Network (ABN), this is not difficult. She had a stand for GrowCo at ABN’s last expo. Also a member of the American Chamber of Commerce, she attends the wide variety of events they host, her favourite being speed networking.
Similar to speed dating, each person has two minutes to talk, before dropping their business card and moving on. “It’s a good one for confidence-building,” she says. It gives her the ability to practice her elevator pitch, which is basically telling someone about yourself and your business in the time an elevator ride takes. Though the night’s pace is quite fast, Fletcher makes sure to follow up and keep in touch with all relevant contacts.
Events organised by Women in Business, run by the Australian Government, are also high on her list. “They’re really good because they’re free, and they have good speakers,” she says. “I tend now to do a lot of networking events that I’m interested in, rather than just going for the sake of going, because that way you know you’re definitely going to get something out of it.” Women in Business organises between four to six events a year.
Her advice for maximising these events? “Always have business cards in your bag, you never know when you’ll meet somebody.” This advice also extends to everyday activities, including socialising with friends. “It’s something you have to see as a holistic approach, rather than just Tuesday nights at seven I’m networking and the rest of the time I’m not.”
The holistic approach fits perfectly with Stafford’s criteria for developing a networking plan. Besides being constantly ready to network, she recommends attending events regularly rather than moving around and not leaving anyone with a positive impression. “It’s important to get to know people over a period of time. A lot of people make the mistake of attending one networking event, meeting a lot of people, then another one, then another one, there’s no consistency,” she says. “Attend them regularly, attend them well.”
It’s also important to know who your target market is, so you can later assess the charter of each networking group, and choose one with events relevant to your business. “Don’t waste time with people who are not potential referrers or potential clients,” explains Stafford. The group you eventually decide to join should not only be good for networking, but should also support you in your professional development.
After joining a networking group, you need to be prepared to connect other people within the group. “Be in the organisation with a spirit of willing to give, rather than receive, and it will come back to you,” says Stafford. “There’s enough business in the world for everybody.”
Always turn up prepared to an event, and early if possible. You’ll gain the opportunity to meet the host, the most influential person in the room. This will also allow you to scan name-tags so you know who to meet and what you want to talk about, so you’re ready once the conversation gets going.
Finally, make sure all quality conversations are followed up, even if you just send an email. “There’s no point to networking unless you actually follow up.”

Online Networking

Keeping in touch has become easier. Like everything in life, social networking has evolved and gone online. Online social networks, made popular by teens who share their personal details on sites like Facebook and MySpace, now come in all shapes and sizes, including GrowCo and LinkMe. While most professional online networks have a small membership fee, they make up for it with their range of services.
Also, for those with no experience in networking, the online environment is much less intimidating, says Fletcher, who founded GrowCo for this reason. “I’ve been there and seen how hard it can be and how nervous people get, and how they don’t want to talk to people because they don’t want to be seen as pushy,” she says. “It’s kind of scary, walking into a room on your own and talking about what you do to other people, especially when you first start out, because you don’t have as much confidence.”
Websites like GrowCo allow you to ease into networking without the pressure of face-to-face interaction, and if you find they suit your needs, you can choose to continue networking purely online. “I think that really helps people get over their initial nervousness,” Fletcher says.
Networking online has a different appeal for Paul Tyrell, LinkMe development manager, who sees it as a time saver that broadens the range of people a business owner can connect with. It increases new business opportunities, and connecting online means employers also have more choice in hiring staff they know and trust. “Hiring a person who is a friend of a friend is a great way to reduce your risk of hiring the wrong person,” he says. And we all know having good staff is one of the surest ways to successfully build your business. According to Tyrell, depending on the industry, 60 to 80 percent of people are hired through networks. At LinkMe that number is 90 percent. “Networking gives you new staff and trusted referred staff.”
Networking online allows you to maintain long distance business relationships as well, especially those across different time zones. “If you are on LinkMe or another networking site you can start and maintain a dialogue with them, either personal or professional, and it’s a thread which isn’t buried in a mountain of emails,” says Tyrell. “There is a place for online networking communication which isn’t [instant messaging] like Google Talk or MSN, and is less formal than email.”
Another plus is the ability to keep your personal and professional networks separate, says Tyrell. If you’re already communicating with a colleague through a professional site, there is no need to add them to your Facebook friend list. “You may not want your boss or peers to see photos of what you got up to last weekend,” he explains. By keeping your social and professional networks separate, you can hear about great prospects and avoid other potential disasters.
With so many opportunities to grow your business through networking, there’s really nothing to be afraid of. While it doesn’t come naturally to all, it doesn’t take an abundance of confidence to become a good networker, only preparation and persistence. Remember, the only thing your competition can’t replicate is the quality relationships you’ve built.

Networking Contacts

For more information on networking from Carolyn Stafford, small business marketing expert and the author of Small Business Big Brand, or for details on her national workshop, visit www.connectmarketing.com.au
Here are some networking groups you may be interested in joining:
Australian Businesswomen’s Network─www.abn.org.au
Business Swap─www.businessswap.com.au
Dynamic Small Business Network─www.dsbn.com.au

Speed Networking

The American Chamber of Commerce annually organises two speed networking events. Each person spends four minutes with the majority of attendees; two minutes each to talk about themselves and their business. When their time’s up, they move on, but not before exchanging business cards.
It’s all the fun of speed dating, just without the cocktails.
Prices start from $70.00 for members and $93.00 for non-members. For more information on dates and other events, visit www.amcham.com.au



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