Business can be too hard doing it by yourself. Partnerships can deliver the missing pieces.
Creating partnerships can propel your business into the future you want
Good partnerships can provide the necessary leverage and motivation to, improve the overall performance of your business or organisation by having it well resourced, well funded and well supported.
Partnerships should not be viewed as another form of charity, but rather an accepted marketing and communications tool, from which your business can benefit greatly.
Partnerships don’t just give donations like sponsors, they expect their contributions will give them a meaningful and measurable return. Partnerships support businesses and community activities where it is possible to achieve strong recognition of their company’s brand.
Meaningful partnerships are the foundation for success. Today we live in a chaotic transition period moving to a new age defined by global competition, business complexity and pervasive globalisation. Good partners can bring much-needed resources, expertise and opportunities to a business.
The pace of change has become so rapid that different types of businesses have become dominant, where others have failed. The new environment is also characterised by more far-reaching technological advances and consumers who have adjusted to this quicker pace.
Questions you might need to ask yourself
You need to take your time to find the ‘best fit’, Which means working through a process to narrow down and then find the business partnerships that are most suitable for your business.
- Does our business need any partnerships?
- What are our growth goals for the business?
- How soon do we need some partnerships?
- What do we have to offer potential partners?
- What is the right partnership format for our business?
- How can they help to leverage all of your business assets?
- How will we ensure good communication with our partnerships?
- How will you apply successful partnership principles?
This means analysing what you can offer to a partnership, as well as what they want to gain from it and what benefits both parties wish to see the partnership bring about in the marketplace or community.
You need to find the best fit in terms of similar values, visions, objectives and operating styles of prospective partners.
Spheres of influence
- Local partners.
- Regional partners.
- State partners.
- National partners.
- International partners.
As a local business, you are unlikely to attract state or national partners unless:
- You have something that they want.
- You are in a complementary vertical market.
- A business has a personal connection.
- Your business has a special appeal to the wider community.
- Your business is in one of their areas of operation.
- You are producing something that is tied into national or international significance.
A partnership model is a structure around which partners base their arrangements with the business. Approaching a potential partner simply with a cash contribution in mind is not necessarily in the interests of the business.
There are a number of aspects of partnership models, including:
- In-kind support (products, services).
- Skills, information and knowledge sharing.
- Secondment work for the business where the partner’s people can learn.
- Discounted work for the business.
- Use of plant and equipment.
- Special expertise enhancement for both parties.
- Financial contributions.
- Using the business as a collection, or distribution point.
- Corporate Social responsibility issues (CSR).
Businesses are focusing on recruiting partners that offer technology and services in complementary vertical markets, or market areas. Today it’s critical that the overall strategic planning process addresses the market trends, opportunities and threats the current market trends indicate. This should be proactively addressed in business models and more than likely will separate the next round of market winners.
“The most important single central fact about a free market is that no exchange takes place unless both parties benefit”. Milton Friedman
Good partnerships keep the gears working well all day every day, taking you in the desired direction.
Consider what’s in it for the proposed partnership?
They will be looking for solid business proposals that will help them achieve their own business goals.
- They will be looking to you to raise the profile of their organisation to help sell more of their products and services.
- They want to reach particular audiences or niche markets, that are considered too expensive for their normal marketing.
- They want to be seen to be doing something for small business or for a community the community.
- Partners may look to attract a new, larger or different audiences to that of their normal activities.
- They might be looking for a confidential research opportunity where a smaller business can play an important role with special expertise.
- Partners can be interested in Corporate Social Responsibility (CSR), utilising their employees to deliver services to the social enterprises and not-for-profit organisations in its community.
- It can be a way they can fulfil their Corporate Social Responsibility (CSR) requirements.
- It is a way for corporations to give their employees first-hand knowledge of what goes on in smaller businesses and in regional or remote communities.
- Many corporate employees simply want to contribute to something special.
What’s in it for you?
- Provides funds and other resources, in both cash and kind.
- Improves the businesses ability to deliver products and services.
- Reduces the cost structure of your business, to improve competitiveness.
- Provides additional support to the business’s management.
- Brings about more efficiency and effectiveness in the delivery of services.
- Builds a critical mass to provide quicker and better responses to customers.
- Enhances marketing efforts through market access and distribution efforts.
- Develops new products and services beyond the business’s capacity.
- Gives you access to technology beyond the scope of a single business.
- Helps to share and exchange expert knowledge and information.
- Enhances the business’s research and development capability.
- Provides additional capacity to address larger opportunities.
- Help to get new products and services to market more quickly.
- Leverages the businesses strengths and opportunities, for better outcomes.
Finding suitable partners
- Start by looking for possible partnerships in your local community or region.
- Determine what is marketable and the degree of attractiveness of your business, or its products and services, to a potential partner.
- Look for companies that take out their raw materials from your area.
- Look for large companies that draw their employees from your community.
- Seek organisations that have activities in harmony with that of your business.
- Write to possible Partners asking them for a copy of their partnership policies.
- Most importantly make sure your business is ‘Investor Ready’.
- With some negotiation, an ordinary partnership might become just what you need.
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It is important to remember that partnerships don’t necessarily last forever. Many bigger companies and corporations are only interested in partnerships that will last three to five years before they move on.
Don’t overlook the fact that your needs will change as well. Here are a few other suggestions to help you get started.
- Go back to the basics.
- Don’t ignore possible opportunities you can’t immediately
- Manage egos and emotion get in the way.
- Stay flexible and be prepared to make compromises.
- Trust your gut feelings and back them up with logic.
- Hasty decisions can be very costly.
- Map out your mutual expectations in writing.
- Be prepared to negotiate.
- Don’t do everything yourself, that’s why you have partnerships.
- Develop an exit strategy before you get started.
- Don’t overlook the details, get legal advice early.
Good partnerships usually continue to be a good fit.