October 2008

Why is it that many small business owners are bombarded by invitations to a myriad of networking events? Well, like many things in business – it’s a numbers game.

Networking organisations need to grow or at least maintain their membership numbers by inviting and converting visitor numbers to get the best out of their particular methodology.

It’s all about relationships! And so, if a networking organisation can grow the membership of a group to about 40 people, not only does that allow the meeting to be managed efficiently, but it also has a dramatic affect on the number of relationships that can be developed within the group.

Let me explain. If we had 2 members in a group, then there would be just 1 relationship that could pass referrals. With 3 members that number triples (A to B, A to C, B to C). With 4 that rises to six and with 5 it reaches 10. So the possible routes for business to flow increase exponentially as you add new members.

Here are some more numbers:
12 members = 66 relationships
20 members = 190 relationships
40 members = 780 relationships
50 members = 1,225 relationships

It's a simple formula if you want to work it out - where "n" = the number of members, the number of relationships equates to n2 - n / 2. So for 30 members it's 900 (30 x 30) minus 30 = 870 divided by two = 435.

So, if a networking group could grow from a current level of 30 members to 40 members, that would almost double the amount of potential referrals for each member.

Therefore, if you are a member of a referral networking organisation, or you are currently researching the market, or thinking of joining one, perhaps the science behind the methodology will help you decide.

But remember, its all very well being a member but its TAKING ACTION to develop those relationships and pass referrals that results in business. After all, why else would you join?

By Andy Willmore - Ology Coach, Worcester

< back to latest news