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Any business' best resource is the customer who's already done business with them. This customer will be the one who provides return business, and refers new business. How can you insure that you get those referrals, though? As anyone knows, people will be more inclined to pass on information about bad experiences than good experiences. So, you have to give them an incentive. The best way to do this is to run a REFERRAL CONTEST.

Give each one of your customers a supply of cards they can give out to their friends. A good idea is to use your business card, and get a rubber stamp designed to stamp this message on the back:

"Send a friend! You will get a one coupon good for a XX% discount for each new customer who brings this card in! Good through XX-XX-XX. Add the new customer's name.

Insert the discount you want to give the person making the referral, and the expiration date. Two good ideas are to either offer a prize to the person who sends in the most referrals, or put all the cards that are brought in into a box and hold a drawing at the end of the promotion, with both the person making the referral and the new customer getting a prize.

It's important that you publicize this contest. A contest is no good if nobody knows about it. So, put a big sign about it in your store. Put an ad in the free weekly paper in your area and in any freebie advertiser tabloids. Print up some flyers and put them up in places where people will see them.

Referral contests work especially well for service businesses, like hair salons, auto mechanics & body shops, dry cleaners, video stores, caterers & photographers. Any business that relies on expanding it's clientele can successfully grow from a referral contest.

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