What Is Networking in Business? (With Tips and Importance)

Networking in business can supply resources for company growth. A high-quality business network may provide recruitment leads, opportunities for increased profits and key industry knowledge. By learning more fundamental information about business networking, you can ensure a company’s success and enhance your own entrepreneurial skills.

In this article, we define networking in business, discuss why it’s important, explain how it works and offer tips for networking effectively.

Key takeaways:

• Business professionals can network with other industry members to learn about new trends, share insights and receive valuable mentorship.

• Business networking is important because it allows professionals to identify new opportunities and increase their chances of entrepreneurial success.

• Professionals can participate in business networking by attending seminars or webinars, joining a networking group and following the social media profiles of other entrepreneurs.

What is networking in business?

 Business networking is the act of maintaining positive relationships with clients and other professionals in your industry. Maintaining a contact list can allow you to share important insights, stay updated on industry developments and achieve business goals. You may also offer and receive valuable career guidance or learn about job opportunities. To create a beneficial network, business professionals often intentionally seek opportunities to expand their list of professional contacts. 

Related: Definitive Guide to Business Networking

Why is networking in business important?

Business networking can give you access to new opportunities you might not be able to find on your own. For example, your network could provide you with insight into new sales techniques, information on a competitor's marketing strategies or advice on how you can improve professionally. A list of business contacts can also become a great resource for fulfilling company needs, such as an ideal candidate for an open position.

Effective business networking can save you time and alleviate stress, so knowing how to use it effectively can be a powerful tool for a company’s development. Here are more reasons why business networking is important: 

• Generate business leads: Networking with others professionally can help you identify new sales opportunities. This may be especially relevant for business-to-business (B2B) companies, as they rely on the patronage of other companies to increase profits.

• Learn industry standards: Gaining new business contacts can help you understand your industry’s common strategies and best practices. For instance, a new grocery store might learn which vendors supply the most popular fresh produce in a local area. 

• Identify key trends: Industries often change over time, so maintaining positive relationships with other business professionals can help you stay informed about the latest news or innovations. If you’re a software engineer, for instance, you might exchange new coding techniques with other programmers through social media.

• Increase brand awareness: Sharing your ideas and strategies with other professionals can help them understand a business’ mission and values. This may be especially relevant for creative professionals advertising their work to potential new clients, as they may rely on their own marketing efforts to find new projects.

• Understand different perspectives: Professionals often have varied viewpoints on how to perform certain tasks or plan activities. Conversing with multiple individuals in your industry may help you learn unexpected strategies for improving business processes.

• Receive mentorship: Industry leaders typically have large-scale contact lists and multiple years of experience to share. By bonding with these individuals, you can receive expert advice on how to grow a company and perform essential tasks.

• Develop your confidence: Sharing your business ideas can help you trust your business instincts and strategies. As a result, you may pursue more opportunities in the workplace and increase your chances of developing long-term relationships with other professionals.

Related: The Benefits of Networking: 14 Reasons To Start Your Network

How does business networking work?

Business networking typically occurs at an industry event arranged so multiple professionals can connect in the same location, discuss relevant topics and exchange ideas. You can also find similar opportunities online through certain social media platforms, forums and webinars. After these events finish, you can exchange contact information with other attending professionals or follow their online account to stay updated about their business activities. By maintaining positive relationships with these individuals, you can exchange advice and insights that may help you grow a successful enterprise.

Here are some other common ways to network in business:

• Attend a business seminar. Entrepreneurs often give lectures on specific topics relevant to their niches. Conversing with attendees who share your interests or work style can help you expand your contact list and exchange helpful advice.

• Join a networking group. To find more consistent business networking opportunities, you can join a civic club or professional organization that focuses on relevant industry topics. For example, you might join your local area’s chamber of commerce, which is a group of entrepreneurs that offers opportunities for referrals and business development.

• Create a social media profile for business networking. Certain platforms allow professionals to cultivate a network through different types of online engagement. For example, you might post blog-style updates of your recent business activities to your follower base or request to be online friends with an industry leader.

Related: 10 Types of Networking Events

7 tips for effective business networking 

Consider these seven tips on how to use your professional network effectively:

1. Look for the right people

Connect with professionals who can offer the specific help you need. For instance, if you’re interested in pursuing business opportunities in a new field, consider engaging with friends or former colleagues who work in that industry. If you’re seeking new social media strategies instead, you might attend a webinar hosted by an expert, then engage with their online profile afterward. To find the right networking activities, consider asking a workplace for recommendations or researching options online. 

Related: 35 Networking Conversation Starters

2. Be proactive

Cultivating your network regularly is crucial to maintaining beneficial connections. If you joined a professional organization, for instance, it may be helpful to attend multiple events per year or stay updated on your fellow members’ activities. Even just sending a short email to a contact may indicate your interest in their professional lives, which can enhance your overall relationship. Consider checking in with your top contacts every week or spending time with them in a professional context.

Related: Networking for Introverts: 7 Tips for Making Better Connections

3. Offer assistance 

Keep track of your contacts’ skill sets and business ventures so you can offer support, when appropriate. Becoming a resource for others can encourage your contacts to trust your expertise and view you as dependable. If you provide helpful assistance, your contacts may also be more likely to support your own activities. Be sure to respond promptly if a contact approaches you for advice. If you lack knowledge about a subject, you can direct them toward another contact or pose their question to a networking group.

Related: 12 Types of Networking Connections (Plus Tips for Making Them)

4. Cultivate personal contacts online 

The internet is a valuable resource for creating, cultivating and communicating with your contacts. Use social media platforms to connect with professionals in your area, reconnect with old friends and start conversations with the people you meet while on the job. A friend or acquaintance might become a professional contact in the future, especially if you share mutual business interests and objectives. Sending a friend request or a brief message to a new contact may help them remember you and encourage them to seek out a mutual relationship.

Related: 7 Steps To Improve Your Networking With Social Media

5. Attend company events

If you work at a company, they might host regular events to encourage employees to socialize. Attending company mixers, corporate retreats or community events may help you meet a variety of key contacts, as you may see these individuals on a day-to-day basis. After bonding with colleagues, ask if they're interested in exchanging business cards or contact information. Be sure to stay aware of your company’s social calendar so you can prepare for events beforehand. 

Related: 20 Ideas To Enhance Your Next Networking Event

6. Follow up after events

It’s often important to follow-up with any new contacts you find at an in-person or online event. This demonstrates your interest in their business ventures and an ability to hold yourself accountable. As a result, a contact may remember you for future opportunities or positions. They may also become more receptive to your advice or offer their own, which may enhance your business developments and strategies.

Related: 55 Subject Lines for Networking Emails

7. Develop an elevator pitch

An elevator pitch is a short introduction of your personal information and business interests. It allows you to communicate the purpose of your networking efforts quickly, which can help you form connections more efficiently. Consider writing three key points that can help others understand your perspective. It may be helpful to store your elevator speech in a document so you can update it in the future. Practicing your speech delivery in a mirror or a webcam may also help you speak more clearly and confidently.