Best Business Choice

In the NRG Linkedin Group last week there was a discussion about 'Making a Business out of Networking'. Some of the discussion was about leading a networking group as a way of growing your existing business.

Last month Sarah Owen of the Referral Institute presented a Networking Masterclass before the NRG Charing Cross lunch in London. One of the things she want through was their VCP Process™. This stands for Visibility, Credibility and Profitability*. A good networking group provides the platform for people to go through this relationship building process.

Leading a group can move your relationships through to Profitability when done in the right way with the right people. Sarah shared with us the experience of her and her clients who see a seven fold increase in the profitability of their networking for their existing business when they lead groups. Too often, however, people think about running a group in the wrong context. Some think it is about a new revenue stream. Others that it is just about lead generation and concentrate exclusively on the Visibility bit.

Many networking organisations have positions for people to lead groups (including ours). These positions are not usually about creating an additional revenue stream. I would treat anyone that claims that for leading a group with suspicion. Leading a group is really about increasing the overall return on investment in your networking for your main business. As Sarah said "it is about increasing the profitability of the business relationships you build through networking". A good rule of thumb is that any income generated just for running a group should pay for your networking activity.

There are some business opportunities with networking organisations that are genuinely about creating a revenue stream. These are usually a networking franchise of some description where you are investing equity to build a business. In this scenario you will building a business with the primary revenue being from the activity of networking itself.

Leading a group could be right for you if it makes sense for your business to be at the hub of the business community in that group. That could be an existing group or using a networking organisation's existing infrastructure to get a group together of the people you want to have around you in the group.

*VCP Process™ copyright Referral Institute 2010, all rights reserved.

Good Networking!
Dave Clarke