How Networking Can Benefit Your Business

All kinds of businesses need customers or clients –its market– in order to prosper. The business was established in the first place because the business owner believes it has a market, whether already existing, for creation or a combination of both. The problem is how to reach the largest expanse of the existing or potential market to make the business as profitable as possible. So many stratagems, techniques, methods and systems were invented to accomplish this aim, including networking.

Networking is different from network marketing, which is also called ‘multi-level marketing’ in that sales are paired by recruitment of other salespersons as an additional way for a salesperson to earn. His recruiter is his ‘upline’ and his recruits the ‘downline’. A recruiter earns from the sales made by his ‘downliners’ the same way a sales supervisor gets an overriding commission on the sales made by his sales team members. Thus the more ‘downliners’ one has, the greater will be his potential income.

In networking, the businessman simply connects with his peers in the industry for certain benefits, mostly intangible, that he derives from the connection. Some of these benefits are:

Information. A businessman can get information on problems he may have, but previously experienced and solved by his peers. Or maybe information to avoid failures and pitfalls already known to others. New business leads, additional contacts, and extended sources of referrals are just a few of the information an entrepreneur can derive from networking.

Enhanced reputation. But only if it is good to begin with. More people will know of you as someone who is, say, easy to talk with, reliable in his word, and so on. This can only enhance your standing in your business field.

Promotions. The more people know what you do or have, the greater are the chances of you making sales or finding clients. Nothing is more effective than word-of-mouth promotions and networking offers you that opportunity.

Knowledge sharing. You and your peers in your network would swap trade information, personality assessments, news, problems and solutions to learn from each other’s experiences, expertise and ideas. One person can have extensive knowledge about the field, but the combined knowledge of all in the network could be, as often said, ‘greater than the sum of the parts’.

Ready back-up. If you have an opportunity to produce something in numbers more than you can handle, but which you can subcontract to your network peers, won’t you do exactly that? So would your peers.

Education and guidance. You can learn new tricks or imbibe new practical skills from casual meetings with peers or via formal symposia and conferences where sharing of ideas is the norm. Or, an older person can teach you what he knows through informal mentoring to guide you through your turbulent business years. There is always that opportunity in networking.

Networking is an appropriate and effective business strategy in today’s information age. If you don’t think so, consider how Facebook, Twitter and LinkedIn got to the size they are today.

This was a guest post by Julian from Bourton management consultants, specialists in operational excellence.

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