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 Bob The Broker’s blog: Should we be buying leads? 

It only seems like the blink of an eye lid since I was composing the first blog of 2011, and now we are 1/12th of the way to the next new year. Time flies when you're having fun, or getting old some may say. 

This first month of the year has seen my potential business coming in from all the normal routes, existing clients with new funding projects, referrals from existing clients, introducer's doing their bit and getting in on the action, and direct contact from other potential clients.   A little survey...   However due to my workload not getting me hot and bothered, and with me not uttering the words “I just haven't enough time in the day to get my work done,” I thought I might run a survey on a new project to my business, that's the option of buying leads.   I have been keeping an eye on some of the commercial leads that are reaching my desk from residential brokers, brokers who don't do any commercial business. One thing that I've noticed is that when the leads are emailed to me they seem to be purchased leads from one particular source. But the detail that really caught my eye was the price these residential brokers had paid for these leads. The prices ranged from £1 up to around £20, and one or two of the leads that I followed up have actually produced business for me, with the introducer's getting a generous cut, as we'd agreed terms prior.   So I thought I'd look more into this... It's not something that I've ever experienced, in fact since joining this industry in the mid eighties I've never purchased one lead. Furthermore, I've never advertised for business, so it's slightly alien to me, the main thing I had to get my head around was actually paying for business, but I decided to give it a go. After all, in a roundabout way the introduced business actually costs me (when there's an introducer agreement in place), and it certainly was way out ahead of the cost of these leads that I was seeing.   Setting the prices...   So, I set my outlay extremely low... I decided to set a fixed price on the leads at £5 each, I also maximised the leads at four for the month. I can live with twenty quid, with no more than two on any day, and on day one I actually got two leads texted to me, they also arrived by email.   I looked at the lead details and then proceeded to speak to both the applicants, and I'm pleased to say that my £10 spent to date got me talking to two clients who are both currently looking for finance. When it came to discussing it with them they were both actually after development finance, but to me it was still looking good.   I fully expect both of them to move forward this next week and if that happens I'll be extremely happy. My tenner will look insignificant at that point. So I'll keep running this exercise via this blog over the year and keep you updated on the outcome, and the cost effectiveness. It certainly has got my interest. So my wishes for February..., as many enquiries as January will be fine, but with a better strike rate to enquiries becoming signed up clients.