Our story begins with a leak from my home’s antique pipes. With water dripping from my ceiling, and oozing down the dining room walls, I wasn’t inclined to shop around for a contractor.
I needed help stat. And I expected my home insurance to foot the bill.
At 7 am, I call Liberty Mutual, who gives me a name: DC Generals Roofing and Siding is their go-to water remediation expert. I’m advised to contact them and told that my insurance will reimburse me. No questions, no market research. I make the call, and DC Generals gets my business.
Wouldn’t it be nice if every new customer fell so easily into your lap?
Too often, small businesses lose sight of how easy customer acquisition can be. In the flurry of directionless networking, entrepreneurs forget to build a purposeful referral network.
But if you can find a few trusted partners who reliably send you business, you’ll never again scurry after lukewarm leads. Better yet, find a partner who also foots the bill.
Read on to discover how DC Generals built and maintains a referral engine that brings them a steady flow of new customers, and how you can replicate their model.
The winding path to a referral-based business
Jon Layne didn’t start off in the roofing business. DC Generals’ owner grew up in the construction world, building new homes in Utah with his dad. “When the market crashed in 2008, I had the opportunity to take on a commercial job out in Maryland, thinking that would be something I’d do for the rest of my life. On day two, I hated it.”
Casting about for his next act, he decided to work for himself. He focused on remodels, and quickly became the preferred sub-contractor for a national solar company’s roofing work. When the company closed its office in Frederick, Maryland, he hired the laid-off team, putting them to work selling roofing door to door.
“There was a period with a lot of storms, and you could often see the storm damage from the street. We’d knock on homeowners’ doors, and walk them through the insurance process.”
At the time, Jon had no relationship with insurers. He didn’t even know if a given homeowner’s insurance would cover the damage. He simply responded to an urgent need and lent customers his expertise when they needed it most.
As DC Generals’ reputation grew, Jon struck up friendships with insurance adjustors in Maryland and Virginia. Like quiet talent scouts, they saw the roofing company’s potential and referred Jon to several third-party providers that vet contractors on behalf of the nation’s largest insurance companies.
After undergoing a “pretty heavy vetting process,” DC Generals earned its coveted status as a preferred service provider for Liberty Mutual, State Farm, Cumberland, and a few smaller insurance companies. Today leads from insurance count for 70 to 80% of DC Generals’ business, and apart from a website and hundreds of stellar online reviews, the company spends little time or budget on marketing.
Referral partners hold you to a high standard
DC Generals makes it look easy. Who wouldn’t want a partner that serves you a healthy diet of hot leads? No effort required. No picky customers to appease.
After all, with DC Generals, I wasn’t even their customer. That honor rested with my insurer. So, in the grand tradition of so many contractors before them, DC Generals might have been expected to furnish me with the kind of customer service that inspires homeowners to offer a rueful sigh: unexplained absences, mysterious delays, and a completion date that stretches towards the distant horizon.
Instead, they surprise and delight from start to finish.
When I call from my waterlogged home, they answer on the first ring. Friendly and cheerful, operations manager Rob Bond listens to my story, asks questions, and explains exactly how they would work with my home insurance. He vows to dispatch his team later that morning, and lo and behold, they arrive on time and with the right equipment. As work progresses, Rob checks in regularly, his timelines on drywall installation or recommendations on new carpet options a steady optimism that salves the pain of home repairs.
Within two weeks, mold had been conquered, tarps removed, and my dining room looked better than the day we’d moved in. DC Generals turned my bad day into an exceptional customer experience. And in return, they gained a fresh five-star review and a vocal booster for their services.
See, the trick to building a referral engine is that you need to maintain it. And the more lucrative the referral, the more you can expect your partner to hold you to high standards. If DC Generals failed to deliver, they’d be knocked from their perch by a competitor only too happy to satisfy insurance companies’ expectations.
Building a referral-based business affords you certain luxuries: a token marketing budget, and a speedy, no-fuss sales process. But that time and money are not magically saved, at least not in full. It must be channeled directly into your service delivery. Fail to provide a consistently awesome, praise-worthy service, and your golden goose will nest elsewhere.
Building a referral engine across industries
You don’t have to run a home services business with a sweet insurance contract to leverage a referral-based growth strategy. Whether you run a dental practice or a law firm, there’s a lot that service-based business owners can learn from DC General’s success:
Build a network without expectations: Don’t lurch straight for a handout. DC Generals built a network among complementary businesses, established a reputation as a reliable partner, and over time, fellow business owners wanting to keep their customers happy introduced John and his team to the opportunity to connect with insurance companies.
Create a culture of excellence: “99% of our customers have had a flood. They’re understandably upset,” Jon notes. “We need to be the voice of calm. We set expectations, explain how long it will take to complete a job, and then deliver.” When hiring and training, DC Generals prioritize kindness, a service mentality, and the ability to stay cool under pressure.
Discover who your customers trust: Whether they need a doctor or a drain cleaner, customers rely on their network to connect them with reliable service providers. Talk to your customers, ask questions about their pain points, and it may direct you to unexpected partners. From all those door-to-door sales calls, DC Generals learned that homeowners defer roof repairs out of fear: either they face the hassle of dealing with insurance, or the expense of paying out of pocket. By working directly with insurers, DC Generals solved both problems for its customers.
Outstanding customer service is the cheapest form of advertising: DC Generals doesn’t just have a referral engine. It has a flywheel. Insurers refer them, to customers. Happy customers tell their friends. More customers mean their trucks appear as mobile billboards in more neighborhoods. More customers also mean more great reviews, which attracts more customers…
Build a referral engine across industries
DC Generals may benefit from insurance contracts, but their trusted relationship with partners that consistently send business their way is an enviable asset many service-based businesses can emulate.
Looking for inspiration? Try one of these in your business:
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🐶 Pet Services: Find vets who want to see their patients well-groomed and healthy from daily walks in-between visits.
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👩🏫 Tutoring business: Connect with teachers, special education advisors, and high school admissions counselors eager to see their students thrive.
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🏠 Home improvement contractor: Apart from replicating DC Generals’ insurance model, home remodeling and repair businesses can share big projects. When a new homeowner is putting in a fresh kitchen, they might also be looking to spruce up the backyard. Equally, real estate agents are great partners, given that people often sell their homes right before OR after a makeover.
In short, map out the entire lifecycle of your customer’s needs. What do they do before they need your services? After? What else do they buy? Make a list of the other providers your ideal customers use, and consider how you can make them look good to their customers.
Get creative and stand out. If you’re an orthodontist, ask the local indoor play zone to display your business cards to their pre-teen customers.
And focus on win-win relationships. Give referrals as often as you receive them.
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Are you ready to build a referral engine?
DC Generals is proof that building a pipeline of referrals can be a powerful strategy for small businesses seeking growth and success.
By building win-win partnerships with other providers, small businesses can build a steady and low-cost stream of business, enhance customer satisfaction, drive repeat business, and even attract new customers outside of the referral arrangement.
