So, you want to buy a kayak.

If you were looking to buy a kayak, and you knew someone who sold them, there is a high probability you would buy from them, wouldn’t you? Yes, there are considerations: sit-in or sit-on, length, seating, storage, paddles etc but the reality is that your friend is likely to be your first port of call.

This simple example works to highlight the value of relationships. Something in business that provides a significant yet often underrated advantage. Put simply, the more you build strong and long-term relationships the better your chance of developing these relationships into a sales pipeline to grow your business and extend your network of influence.

Despite the significant benefits, most businesses don’t invest enough time developing relationships. Instead, they focus on existing customers and those ready to buy now. Yes, it makes total sense to do that but by ignoring the value of relationship building you miss a great opportunity to nurture relationships and ensure that when they are ready to buy, yours is the first number they call. This is often referred to as ‘Mind Share’, where share of mind = share of business.

The great thing is that by focussing on building relationships the whole approach can have an almost exponential effect as you start to gain opportunities from your contacts through their extended networks.

Consider this. When people look to buy [anything] they firstly rely on memory and past experience. Have they purchased this before, did it meet their needs, was the experience good and if so, they are likely to buy or at least consider the same again. This is why looking after existing customer is so important.

However, if it is something new to them or the previous experience was a poor one, they then look to who they know for guidance and advice – trading on another’s memory and their past experience. Which, if you have built strong relationships can generate direct opportunity or a referral for you.

Research by Sergio Biggemann and Francis Buttle highlights the value of B2B relationships within four dimensions:

1) Personal value, reflected in customer retention and referral.

2) Financial value, expressed through increases in efficiency, share of business, share of market, and achieved price.

3) Knowledge value, expressed through market intelligence, idea generation and innovation.

4) Strategic value, experienced through gains in long term planning and access to extended networks.

Building relationships is not simply useful, but essential if you are to thrive in business, especially in more challenging times when you can stand out from others and outperform your competitors by being seen as a reliable source of support – someone that can solve a customers need.

As Scott Stratten said “If you believe a business is built on relationships, make building them your business.”