How to Write a Referral Agreement

A referral agreement pays someone for introducing customers — not for closing the sale themselves. It turns "send me clients and I'll pay you" into a written fee, a definition of a qualified referral, and a rule for when the fee is actually earned.

Use our free referral agreement template.

1. Define a qualified referral

Write what counts: a new customer in a certain category, introduced in a certain way (email intro, form, unique link), who was not already in your pipeline. Without this definition, every inbound lead becomes a fee argument.

2. Set the fee and when it is earned

A flat amount per closed deal or a percentage of the first invoice are both common. State when the fee is earned — typically when the referred customer pays you, not when they merely take a call. Add chargebacks if that customer refunds or never pays.

3. Explain how referrals are tracked

Name the method: a shared spreadsheet, a unique link, or written notice within X days of the intro. Tracking is what makes the fee payable without a debate six months later.

4. Independent status and non-exclusivity

Referrers are usually independent, not employees, and often not exclusive. Say they may refer others and that they do not speak for your company. If they will actually sell on your behalf, use a commission agreement instead.

5. Term, then both sides sign

Set how long the arrangement lasts and what happens to fees on deals already in progress when it ends. Then both parties sign before the first introduction.

Disclaimer: This article is for general informational purposes only and is not legal advice. Some industries regulate referral fees; check the rules that apply to you.