TYFCB – How does that work again?

TYFCB what and why?

TYFCB stands for “Thank You for Closed Business” and it recognises the value of the business (excluding GST) created between BNI members from the referrals they pass to each other.

Why?
• It shows individuals their return on investment (confidential to the individual)
• It reinforces Givers Gain^® by recognising those that give
• It highlights those that have not been able to give yet
• In saying thank-you to the giver, it encourages them to keep finding more referrals (positive reinforcement)
• And it helps to show, with some caveats, how successful the chapter is. • TYFCB also aligns with our BNI Core Values of Givers Gain, Recognition, and Accountability.

How do we work out how much TYFCB we should record?

• There are some misconceptions about what amounts should be recorded for TYFCB and when. Let us all look at four case studies showing referrals that have turned into TYFCB.  
• Each Example will include a case study and the possible multi choice answers. By show of hands please indicate which one you think is correct. • • Then we will see the internationally accepted correct amount and I will explain why. Please note all amounts exclude GST, GST is not included in TYFCB as this a collected-on behalf of the government.

**Hint for Educators – Move through this as quickly as possible and save time for each explanation!

Case Study 1: Retail/Service/Product/Tradespeople

Bruce sells a flower arrangement for $75 plus a $10 courier fee, plus GST, as a result of a referral from Mike for his mum on Mother’s Day. How much should Bruce thank Mike for?

A: The profit of $25
B: The total value of $97.75
C: The flower sale of $75
D: The cost of the flowers $35
E: The total invoice value, excluding GST $85

Answer
Hopefully, that was an easy one! It’s E, The total invoice value, less the GST. This is the amount of turnover increase (gross sales) Bruce’s business received from the referral. We can’t control the profit (or loss) a member makes from a referral.

Case Study 2; Commission Sales

Kim is a contracted real estate agent for Bayley’s. She sells a house for $3.5m (YES – It’s in Auckland) belonging to Neville, a BNI member. The gross commission charged to the client is $105,000 plus GST of $15,750 total $120,750. Kim invoices Bayley’s for $68,250 (+GST) as her share of the commission. How much should she thank Neville for?

A: $3.5M the sale price of the house
B: $105K the commission Bayley’s received (excl. GST)
C: $68,250 the commission that Kim received (excl. GST)
D: $120,750 the commission Bayley’s received (incl. GST)

Answer

Not so easy! If you are in Commission Based Sales (Real Estate Agent, Risk Insurance, Mortgages, Online Sales, Investment) document the gross commission amount. The correct answer is C: $68,250 that Kim invoiced Bayley’s. Kim is a contractor to Bayley’s, and she is a member of the chapter. Her turnover in her business increased by $68,250 and she will judge her ROI on her portion of the commission.

Case Study 3: Recurring Billing

Clif is a software as a service provider. He gets a referral to a rental car company from Sonya, an ex-member, that starts using Clif’s software at $350+GST per month. When and what should Clif record as TYFCB?

A: $350 once after the first month
B: $350 every month
C: $4,200 once a year
D: $7,700 immediately which is $350 multiplied by the average number of months a user keeps Clif’s software for

E: Nothing, Sonya isn’t a member

Answer 
Even harder! The best answer is D: $7,700 immediately which is $350 multiplied by the average number of months a user keeps Clif’s software for. You can also do B but trying to remember to record TYFCB each month or yearly can be difficult for some. Most recurring billing providers know on average how long clients stay. It does not matter that Sonya is an ex-member, she can still be thanked through the APP at the bottom of the chapter list under the option for BNI Directors/ Ex Members.

Case Study 4: Banking and Loans (Same works for Life Insurance)

Ishfaq provides non-asset finance lending. He provides a loan of $36,000 + GST at 8.95% of 3 years to buy a car from a referral of Kevin’s. How much and when should he thank Kevin?

A: $36,000 immediately for the amount of the loan
B: $268.50 every month for 36 months, the monthly interest of the loan
C: $9,666 the amount of interest he receives once the loan is paid off after 36 months
D: $8,055 immediately the amount of interest he would receive for the 30 months which is the average length of time that a loan is normally paid off after.

Answer
Hopefully, this is easier after Case Study 3. The best answer is D: $8,055 immediately the amount of interest he would receive for the average length of time that a loan is normally paid off after. It’s the increase in turnover that Ishfaq receives on average. Again, some members will be able to record these amounts monthly as they happen but it’s difficult for many to calculate and record these amounts monthly or periodically, so B is also correct and the second-best option.  Ishfaq will know how long on average loans will be paid off after and can calculate the interest immediately. It’s not the loan (principal) value, as that isn’t the turnover increase in Ishfaq’s business. If the loan renews, he will calculate the TYFCB on the new loan in the same way. There are other types of business in BNI but please ask your BNI Director Consultant for clarification on recording TYFCB on these if in doubt.

Other notes about TYFCB.

• You can record TYFCB from ex-members, visitors, referrals of referrals of referrals (spin offs). TYFCB can be recorded for any business that has resulted from you being a BNI member.
• You can record TYFCB on invoice or payment, whichever is easier for you to remember to do.
• If you thank someone else, their TYFCB amount in PALMS goes up not yours! You are thanking them.
• The amount you thank someone for is confidential to you, it only shows as Revenue Received/Return on Investment/ROI in BNI Connect and the BNI Connect APP.
• The person you thank will be awarded TYFCB, but they will not be notified that someone has thanked them or of the amount they were thanked for to keep earnings and rates confidential. If you are happy for them to know, you can let them know the amount personally by other means like email. 
• Generally, it’s not recommended BNI policy to include TYFCB in the referrals and testimonials section the BNI meeting when we share about giving to others whereas TYFCB is you about you receiving.
• TYFCB amounts and other stats will not finalise through to member dashboards and chapter stats reports until the VP closes the weekly PALMS after the next meeting after you recorded the TYFCB. You will see the details in your given and received slips, but these are not finalised live.
• When recording the amount, it is INSIDE if you invoice another Member and OUTSIDE if you invoice a Non-Member. SPIN-OFF is when you Invoice someone referred to you by someone who was referred to you by a member.
• GST exclusive amounts should always be recorded.

TYFCB Top App Tip!

• You can now record TYFCB directly against a referral in the APP.
• It is still anonymous in nature and the system won’t tell the other member who thanked them.