Business Referral Agreement

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What is it?

A Business Referral Agreement is a legal document that outlines how a business that refers work to another company or individual will be paid.

Why do you need it?

It makes good business sense to reward people or businesses that refer work to other companies. Businesses can use this agreement if they want to pay a broker to bring in new clients or customers.

Rather than relying on an informal arrangement, it is best to use a Business Referral Agreement that sets out how much, when, and how the referrer will be paid.

Key clauses to watch for:

When drafting a Business Referral Agreement, it is important to focus on a number of key clauses, in particular:

  • Details of the company receiving referrals;
  • Details of the referrer;
  • Services provided by the company;
  • Territories covered by the arrangement;
  • Time of payment received by the referrer, if the prospective client pays for the company's service;
  • Payment frequency to the referrer; and
  • Referral structure.

This document is also sometimes called:

Referral Agreement.

Business Referral Agreement Document

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