Networking is one of the most cost-effective ways to build your business. Are you taking full advantage of all it has to offer?

By Laura Koss-Feder

Robert Iachetta, 29-year-old partner of Innivity Marketing Group Inc., is a strong believer in the power of business networking. His 2-year-old Toronto company, which he owns with partners Robert Dawson, 29, Richard Bouchard, 29, and Jeff Chesebrough, 31, with $1 million in sales and 16 employees, has brought in about 5 percent of its business by networking at JCI events. Iachetta, who has been a JCI member since 1998, used to be vice president of his former chapter in St. Catharine’s in Ontario before he relocated to Toronto. He organizes his current JCI chapter’s monthly dinner meetings, which allows him to network as well. “I try to really get to know people, what they enjoy doing, what their families are like, what their spouse does for a living,” Iachetta says. “Being friendly, open and showing an interest in others is crucial to good, effective networking and is just more fun.”

Iachetta is involved with other organizations as well. He attends monthly meetings of the Toronto Board of Trade Young Professionals Group. He belongs to the Canadian Association of Career Educators and Employers, a group that Iachetta’s firm does some marketing for and publishes a twice-a-year publication for as well. About 5 percent of his company’s business comes through this connection. Another 20 percent comes from networking through the Children’s Wish Foundation and Goodwill—both charitable groups. Says Iachetta, “I’m a big believer in volunteer work and social networking with organizations that you really admire.” 
Iachetta espouses the views of many young entrepreneurs. For them, networking is one of the least expensive and most rewarding ways to promote your business—and make valuable contacts along the way.

“We are a networking society. There are six degrees of separation between all of us, and the more people you come into contact with for your company, the more likely you are to find clients and those who can help you obtain clients,” says Carol Kuc, president-elect of the National Association of Women Business Owners and president and founder of Complete Conference Coordinators Inc. in Naperville, Illinois, which has 10 employees and $1 million in sales. 

Making Connections
But there is a trick to networking successfully. It’s not as easy as it seems. And it goes way beyond just joining your local chamber of commerce—which is always a good idea if your business relies on local customers. If you want to become the best networker for your business, you need two main components, according to Kim T. Gordon, president of the National Marketing Federation Inc. in Sugarloaf Key, Florida: the right attitude of wanting to help others you meet without doing a hard sell, and attending functions or events where you can meet prospective clients or those who can introduce you to clients. And always give yourself time—at least six months—to see any tangible results from your networking activities. 

“You want to join associations where you come into direct contact with the key decision-makers who will choose whether to pay for your product or service,” Gordon says.

Find out as much as you can ahead of time via telephone or e-mail about any organization you join for networking purposes. This would include how large the group is, who its members are, what kinds of committees it offers, its annual fees and how often it meets, says Ira Davidson, director of the Pace University (Manhattan) Small Business Development Center.

“Use your time wisely and target those groups that make the most sense,” Davidson says. “You don’t spend evenings going to cocktail parties that don’t offer you the contacts you’re seeking.”

In addition, you may find that joining charitable nonprofits that share a passion or cause directly related to your business could pay off in new customers, Gordon notes. For instance, if you own a dog boarding facility, it would make sense to join a local chapter of your National Humane Society or become active in fund-raising for a nearby animal shelter.

“Even though they will know that you are looking for new business, nonprofits will always appreciate your time, help and energy—as long as you respect what they do and don’t act too pushy,” Gordon says.

Once you’ve picked out which organizations to join, which you can find though the internet, hone your communications skills. Rather than give someone you meet a pushy sales pitch, ask that person what he or she does for a living, what that person’s business needs are and how you can help fulfill those needs, Gordon says.

Some good, open-ended questions to break the ice and get relevant information include: why someone came to a particular event, what is happening in the other person’s industry, and what the person’s relationship is to the group or individual hosting the event, says Darcy Rezac, author of Work the Pond! Use the Power of Positive Networking to Leap Forward in Work and Life (Prentice Hall).

“The most effective networking involves translating what you do into something someone else will care about,” Gordon says. “Make strong eye contact, listen closely and don’t worry about working the room or shaking 50 hands in one evening. Networking is all about building relationships based on trust—one person at a time.”

When networking, always remember to obtain a business card from someone you meet, and immediately add that card to your database. But don’t make the mistake of collecting cards and not following up with a promising contact. Within a week or so, call or e-mail that person, asking to meet for coffee or lunch, says Gene Fairbrother, lead business consultant for the National Association for the Self-Employed and president of MBA Consulting Inc. in Dallas, which advises entrepreneurs nationwide. 

Be on the lookout for new groups to join. Sometimes, you may join an organization that doesn’t really result in any valuable contacts. If you don’t see any potential connections within a few months, there’s nothing wrong with leaving that group and trying out new sources to network with, Fairbrother notes.

“You may have to kiss a lot of frogs before you meet a prince when you’re networking, so be patient,” Rezac says.

Regardless of which organizations you choose, it makes more sense to be active and become well known among members rather than just appear as another face in the crowd, Gordon emphasizes. People will know that you are reliable and trustworthy if you join and even lead committees. Those good feelings can lead to new clients who will already know what your values are and how hard you work. Taking on the occasional guest speaker role also will increase your visibility. Says Gordon, “Instead of going to 30 meetings, maybe just attend three key committee meetings.”

Reaching Out
Another good way to network is through your local alumni group. This helped bring in business for Jason Finger, 33-year-old CEO and co-founder of SeamlessWeb Professional Solutions Inc., a $49.6 million company in New York City that processes online food orders to restaurants and catering companies which are made by employees working in law firms and other companies. Finger, who received a combined law degree and MBA from New York University, contacted about 150 alumni from both degree programs over a four-month period when he started his business in 2000. He asked these people if they could use his services and if they could put him in touch with the decision-makers at their firms. This intense networking resulted in about 80 meetings for Finger and his partners and about 60 clients.

“Even just someone whom you barely knew in school could ultimately wind up sending business your way,” says Finger, who has 53 employees. “It’s always worth a try.”

In addition, Finger and his three partners—Paul Appelbaum, 33, Todd Arley, 33, and Stefanie Finger, 33—each joined two to three professional associations, where they could meet potential clients. For instance, since company comptrollers are often responsible for managing their firms’ food-related expenses, Finger joined local finance groups in New York City—where he could mingle with decision-makers. About 10 percent of his company’s clients have resulted from such networking. And he has preferred to seek out those with smaller, more approachable companies at such events—rather than go for the large firms. Their business may be more lucrative to your bottom line, but they are much harder to attract as clients.

“As long as you find the right groups to join and go at it with the attitude of meeting people and not pouncing on others with your business card as they walk in the door, you will be able to eventually find clients through networking,” Finger says. “And you can make some great, long-lasting friendships along the way.”

Laura Koss-Feder is a freelance business and features writer in Oceanside, New York, who has written for The New York Times, Time and BusinessWeek.