When it comes to business, referrals are a powerful tool. By receiving a referral from someone you trust, it can lend credibility to your business and help you win over potential customers. However, it`s important to have a clear understanding of the terms of referral agreements to avoid misunderstandings and legal disputes down the line.

A referral fee agreement is a document that outlines the terms of a referral arrangement between two parties. One party, typically the referrer, agrees to refer new customers to the other party, typically the business, in exchange for a fee or commission. This agreement sets out the specific terms of the referral arrangement, including the commission rate, payment terms, and any other conditions that may apply.

If you`re looking to create a referral fee agreement, it`s important to have a sample agreement as a starting point. Here`s a breakdown of what should be included in a referral fee agreement sample:

1. Identification of the Parties

The agreement should clearly identify the parties involved, including the referrer and the business.

2. Referral Services

The agreement should detail the specific referral services being provided by the referrer, including the types of customers they will be referring, the geographic area they will be covering, and any other relevant details.

3. Fee or Commission Structure

The agreement should stipulate the fee or commission structure for the referral services, including the rate or percentage to be paid to the referrer and the payment schedule.

4. Duration of Agreement

The agreement should specify the duration of the referral agreement, including the start and end dates.

5. Termination

The agreement should detail the conditions under which either party can terminate the agreement, including notice requirements and any penalties that may apply.

6. Confidentiality and Non-Disclosure

The agreement should outline any confidentiality or non-disclosure requirements related to the referral services.

7. Governing Law and Jurisdiction

The agreement should specify the governing law and jurisdiction for any disputes that may arise from the referral agreement.

By having a clear and concise referral fee agreement in place, both parties can feel confident in their roles and responsibilities. Whether you`re the referrer or the business looking to establish a referral program, taking the time to create a solid agreement can help ensure a successful and lucrative referral partnership.