Consumers are spoiled to bits in today’s landscape of option after option, choices choices choices. On the other side of the fence this feast of choice has grown out of the competitive nature of business. Companies are continually finding new ways to outdo their competition and find niche audiences to which they can sell their wares.
Now, this is a good thing don’t get me wrong, but what if you’re a start-up or growth business in the throes of reinvention. How can you, overnight start to do things differently, offer new products and services, show a different side to your business and essentially stay ahead of the game?
Something which has taken the small business world by storm in the last decade has been joint venture and strategic partnerships. You see gone are the days when businesses had years in which to grow and reinvent themselves, these things have been happening in the blink of an eye – in response to consumer need, they have to move quickly. And no longer do companies have massive pots of cash to open a new department, or employ new staff to deliver something new to their audience. So what has happened?
Nowadays, partnerships solve that problem. And with clever negotiation and transparent working relationships you can grow the products and services your businesses offer in a flash giving your both greater visibility to your consumer audience, more revenue and the appearance of size.
What to consider?
Let’s check some more reasons why you might consider this:
- Lowering the risk on entering a new industry or market
- Increasing your knowledge base (e.g. Local or legal considerations)
- Access to local borrowing powers
- Influence of a partnership on your new market
- Access by one partner to niche technology or expertise
- Adding ‘clout’ (the influence of the other partner) to the enterprise
- Build on current company’s strengths
- “Go global” by having an international presence through your partner
- Pre-empting competition
- Increase your speed to market
- Create favourable outsourcing terms
So how do you find a strategic partner?
Nothing is ever easy but thankfully with the internet at our finger tips this task is indeed easier than it ever has been. Websites like LinkedIn.com are specifically designed for you to use powerful search tools to find companies and individuals who fit what you’re looking for. On this website you can join groups related to your industry and keep an eye out for the more entrepreneurial amongst them. Those more likely to take a risk in doing business as opposed to the comfort of a 9 to 5 environment.
Online is great but often time you need to get out there and Meetup.com is a great place to do that. There are offline meetings setup by everyone from ICT project managers to knitting circles so you’re bound to find birds of a feather soon enough.
Obviously your local chamber of commerce is also a great place to start; go along to the regular networking evenings which they host. Simply go along and let people know what you’re looking for! Today’s business person is pretty well connected and helpful and before you know it, introductions will be made and the rest will be up to you.
What to look for in a strategic partner?
Now this is the hard part, because there are so many factors to consider; some hard factors and some soft. Some things to think about are:
- Do both parties have similar goals (even if only short term)?
- Are the skills sets suitably complementary to make the joint venture or partnership a success, or do they just conflict?
- Does each company have clear and defined advantages which the other can leverage?
- Is there enough financial incentive to motivate both businesses involved?
- Do you get on each other’s nerves!!
And then there are more seemingly minor but important considerations like who takes ownership of what, whose administrative resource will be used, do you form a new company, how long will the partnership last, what are the review points and milestones etc.
The benefits of strategic partnerships and joint ventures are simply staggering in today’s market and if you can make the recommendations above top priority then you’ll be laughing all the way to the bank!