Guidelines in Creating Successful Strategic Business Partnership
The growth and success of small business depends on creating meaningful partnerships.
While the advantages of entering into a strategic partnership are vast and varied, it is essential to structure partnerships in a way that the arrangement would be beneficial to all parties involved.
Ask yourself the following questions to understand whether you are making the right move:
- What are your goals for entering into a partnership?
- What do you expect to gain?
- What can you offer to the partners?
- What are your core competencies?
- How does the partnership fit into your overall business goals?
- Is your business ready to support the partnership?
- Who will manage the activities of the partnership?
- What will be your exit strategy?
Key Strategies in Building Effective Strategic Partnerships
- Identify businesses and individuals who will make good partners.
A company that possesses technology, skills, market or clients you might need would be a potential partner, provided that you can offer something the other company needs as well. Consider your network: former colleagues, friends, suppliers, industry connections, and other people with a good reputation within the industry that you’ve done business with.
It is recommended to partner with a business that is not directly competing with you in terms of offerings. For instance, a home lighting store can partner with a furniture dealer or an interior decorator. Both appeal to customers moving or renovating their homes, but they are not direct competitors. You can instead create synergy, reach out to new customers and expand the market mutually, establishing a business relationship based on trust.
- Decide what you want to share and offer – and what you will not concede.
Prove to your partner that you can contribute to the relationship. Leverage your skills and resources to bring more value. There are other ways to highlight the rewards, including offering a percentage on sales, , commissions, client referrals and more
Make sure to discuss the partnership with everyone in your team. While working with your partner, you also have to protect your business by setting some limitations. Will your strategic partner gain access to your intellectual property? Identify what you can share and what you need to keep to yourself.
- Establish the conditions early on to avoid failure or misunderstanding.
Work on agreements concerning responsibilities, contributions and distribution of proceeds.
Discuss the scope of the partnership – goals, roles, and obligations of each side. Determine the contributions and marketing support needs of both companies. Set performance plans and targets, and develop clear time frames for attaining those goals.
Focus on how you’ll work together to achieve those targets. Bring everyone’s concerns, expectations and ideas to the table.. Also, discuss how the partnership needs to end: some partnerships may only exist in the scope of a specific project, while others are ongoing business alliances.
Give more emphasis on enabling collaborative activities and developing the best working relationships.
Positive partnerships can ensure your success. Most of th best strategic partnerships display accountability, structure and collaboration. When both partners commit to work together and develop mutual opportunities while serving their individual interests, the relationship will be more profitable for all parties.
Keep these guidelines handy to ensure that you create strategic partnerships that bring steady revenue streams overtime.
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