Small-business owners know building relationships helps build business. But cultivating strategic connections also takes time-one commodity that's always in short supply.
That's where networking groups come in. A growing number of such organizations are working to connect busy business owners so they can trade advice and customer leads in a short span of time. With weekly or monthly meetings, the groups promise a one-stop opportunity to make dozens of contacts that can lead directly to sales.
One of the fastest-growing local networking groups, Rainmakers, has built its membership base from 0 to 700 in just three years. It has locations downtown, at Trader's Point, and in Avon, Greenwood, Noblesville, Fishers and Terre Haute-and is planning to expand to the east side and Westfield.
Rainmakers President Lorraine Ball, who owns a small-business-focused marketing firm called roundpeg, believes so strongly in the concept of networking that she published a book in 2005 called "Confessions of a Networking Junkie."
When her own group isn't meeting, Ball makes the rounds of other networking organizations. And it's not just an obsessive hobby.
"My entire business is referral-based," Ball said. "I do not advertise. I don't have to. In many small businesses, it's the only marketing you need, if you do it well."
Small-business owners who need referrals to succeed can make connections on their own, too. But card-carrying networkers like Ball say it helps to join a group.
"You can do it on your own and form a strategic circle," she said, "but networking groups make it easier."
Networking newcomers can get started by researching and trying out groups, she said. They should make time to attend meetings and events with guest speakers and talk with other members about their goals.
IBJ spoke with several networking gurus: Denise Powell, president of the Network of Women in Business; Debbie Underwood, president of the local chapter of Business Networking International; and Billie Dragoo, past president of National Association of Women Business Owners.
Here are some tips from the experts:
Business owners won't get much benefit from a networking group if they choose the wrong one.
A good place to start is the calendar section of local newspapers, which list numerous meetings of networking and businessreferral groups, Ball said. There are meetings all over town, and most allow visitors to check them out without joining.
Meet some people, research membership requirements and figure out where your expertise might fit in. A couple things to consider: Is it a place where your customers hang out, or are there referral sources?
The right fit can make a difference. Some groups are closed networks that limit the number of people in certain fields. Others, such as Rainmakers, are open to all comers. While Rainmakers lines up speakers who coach members on general topics like public speaking, other groups target professions.
A general approach helped Rainmakers member Eric Schneller find new business for his company, Crew Property Improvement Specialists. Instead of approaching potential restaurant customers to offer his own products only, he built a team of other network members willing to offer a package of services.
Invest in the right group
Once you select a group, invest the time and money to capitalize on your membership. Attend meetings and events featuring guest speakers, offer advice and referrals and participate in committees.
Members might find a mentor and should also invite others who might benefit from their advice, said Dragoo, who has used networking to build her medical staffing and occupational medicine companies, Repu-Care and RepuStaff. She started the companies in 1995 and now has 125 employees. Getting the word out among group members has helped send business her way, she said.
Besides time, networking groups also require a financial investment. The National Association of Women Business Owners charges a $200 annual fee, $100 of which is funneled to the national association.
Others charge fees too: Business Networking International charges $365 a year; Network of Women in Business costs $150 annually; and Rainmakers charges either $399 annually or $30 a month after a $95 initiation fee. Membership dues can be taxdeductible business expenses, Ball said.
Build your business
Ultimately, the goal of networking groups is to grow your business. Each of the experts IBJ talked with has succeeded at that.
Underwood, a senior advertising account representative for Insight Media, says her yearly ad revenue has grown 20 percent-25 percent, thanks in large part to her networking effort. Fellow members of Business Networking International put her in touch with companies interested in cable TV advertising, allowing her to make fewer cold calls and better use her time.
Underwood now is president of BNI's 26-member local chapter, which is very choosy about who can be a member. Just one person in a given profession is allowed to join.
Ball said about 60 percent of her business at roundpeg is attributable to referrals from Rainmakers and another 20 percent to the Network of Women in Business.
Powell, who is president of NOWIB, said she also has seen plenty of business thanks to her membership. She owns an insurance school, Customized Learning Inc. One of her most lucrative leads came from someone she met in the group who knew about the needs of another company, Flanner & Buchanan Mortuary. The mortuary needed its employees to get life insurance licenses so they could sell pre-need insurance. They're now Powell's biggest client.
"You can't just belong to a networking club; you have to take an active role," Powell said. "It's not about who has the most business cards at the end of the night. You have to make connections"