How does it work?

Search engines analyze the links that point to a particular webpage to determine what ranking position the webpage should be placed in their search results for a particular keyword query.

If Page A links to Page B, then link juice “flows” from page A to page B and that generally helps page B rank higher on Google. The more pages (and the higher-quality the pages are) that links to page B, the more link juice page B has and the higher it will tend to rank on Google.

So, if you have a link from your website to an external website (i.e. external link), you are basically contributing or helping the external site to rank better. And if the external site is relevant to your business, they will rank higher than you in Google.

Hence, we recommend avoiding external links on your website. If at all, you need to place the external link, you need to add a "nofollow" attribute to the link. This ensures the link juice isn’t passed to the external website. These are called "Non Juice Passing Links".