Creating partnerships in business gives you a competitive edge and an advantage over your competitors. As much as it is possible for a business to succeed and flourish on its own, you can only excel at so much. Combining the skills you’re best at with those of others that are experts in other sectors makes you a force to reckon with.
What factors should you consider when forming business partnerships?
A business partnership involves combining two businesses to work together towards a common goal. This in itself is already a recipe for success. So what should you keep in mind when forming a partnership with another business?
- Choosing your partner.
Deciding who to partner with is the most crucial decision in forming a partnership and it can determine the success or downfall of your business. In selecting a business partner, a good aspect to focus on is their values. These represent what they firmly believe in and would probably be unwilling to alter even under intense pressure. If their beliefs disagree with yours, then you have a problem. You don’t necessarily have to sideline them completely, but you can discuss your and their value differences at length and find common ground, which you should outline in your written contract with them.
- Complementary skills.
When you own and run a business, you already have skills in which you probably already excel. A partnership situation should complement rather than compete with your existing business. For example, it might not make as much sense for two freelance writers to partner up as it would for a freelance writer and a graphic designer to do the same. Why? Because in the latter example, each party would be bringing in a complementary skill set along with a list of clients, meaning more business for their combined business.
- Mutual benefits.
It’s not only selfish but also destructive to focus solely on how a partnership will benefit you. For any partnership to work, it must be mutually beneficial to both parties. You need to outline each individual’s goals and visions for the business and then come up with a plan on how to achieve them all. A partnership can only work if it’s a win-win situation. Otherwise, one partner might end up feeling shortchanged and withdraw.
- Know your place in the partnership.
A partnership will not always happen between two equally skilled individuals or between parties who’re privileged the same way. It could be you have the idea but don’t have the capital to nurture or develop it, so you partner up with a sponsor. For any partnership to work, both parties must conduct a real assessment of the situation at hand and accept their role. You should, for example, be comfortable with your sponsor making crucial business decisions and calling the shots in the partnership.
- Seek to add value.
What value will you be adding to the business franchise you’re about to form? You need to be in a position where you can give more than you take. A partnership needs to be an arrangement which allows you to keep giving so that you can keep feeling fulfilled which will, in turn, keep you committed. A partnership which challenges you to grow your skills and perspectives is also highly valuable.
Your business might already be successful, but there’s no limitation to how much you can grow or how high you can soar. A partnership could be the best way to take your business to the next level. Put these five factors into consideration when forming a strategic allegiance and you just might hit a gold mine with the growth and success of your business.