Consider negotiating. A fee is reasonable, but why not see if you can make it contingent upon monies actually received? Not every bill gets paid on time, or in full. Also, it seems like after 3 months or so its no longer "his" customer, but yours, especially if he is doing absolutely nothing with the customer. It would seem like a time limit would be entirely reasonable.

Also, it might be a good idea to take $75 out of the first check and send flowers to his wife, with a note telling her thank you for having such a wonderful husband, he's been a great friend for you.

Brian wrote:
I would like to hear some opinions regarding compensation for referrals.

A former IBM Business Partner I used to occasionally work with on a 1099
basis has contacted me with an immediate opportunity to provide services to
one of his clients. He wants to turn over complete control of the account to
me and in exchange he wants me to pay him a flat rate for each hour I bill
to the client. This flat rate equates to about 12% of the hourly rate that
will be billed to the client and stays the same regardless of the number of
hours billed. He's also offered to do this with his other clients when/if
they have a need for services. I can accept these terms but I have no
experience with an arrangement of this nature so my first question is does
this seem fair to both parties? Is this the customary way for handling this
type of referral or are there better alternatives?

Feel free to contact me off-list.



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