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Finder’s fee is a money term you need to understand. Here’s what it means.
What is a finder’s fee?
A finder’s fee is a sum paid to someone for producing a buyer or a seller.
A finder’s fee can be anything from the commission paid to a salesperson for landing a sale to the fee paid to a recruiter who puts talent into an open company position. This term is fairly vague and transcends industry lines, making it a universally known concept from specialty to specialty.
Many times, the finder’s fee is given as a gift from one party to the individual or agency responsible for helping the first party find the match they’re looking for. This is done without any legal or contractual obligation. It is sometimes called a “referral fee.”
Finder’s fee example
A popular model for online shops is to offer small incentives for customers who refer their goods or services to friends.
Often, this is in the form of some type of offer like “You and a friend can save $15 on your next purchase when you recommend us.” If the person recommended to the site makes a purchase, you get a kickback, usually in the form of store credit. This store credit is a finder’s fee.
As an example of a gift, a friend might find a buyer for a property that you’re selling. As a reward, you give your friend a small amount of money from the property sale.
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