A business partnership can be relevant both at the time of opening a business, and if you have been on the market for more than a year. In an ideal situation, the Business Partner should be an expert in the field, knowledge of which is necessary to move to the next stage of development. In addition, it may be an investor partner who has the necessary financial resources for your new project and wants to actively participate in its implementation. A partnership is considered profitable if its goal is to achieve joint financial results that you could not achieve separately.
What should be considered when choosing a partner? In addition to checking the turnover of the partner company for the reporting year, the form of ownership of this company, as well as analyzing other aspects of the issue, the following points should be taken into account. First, it is trust. If you trust each other, this will allow you to concentrate on solving the problems that are relevant to the business and, as a result, succeed significantly. The second is mutual respect: partners’ understanding of each other’s strengths contributes to the development of strong partnerships. And the third, perhaps most important, is common interests and mutual interest. If you want to build a great company that will become a market leader, and your partner shares your intentions, you are already on the right track. Common goals and interests will unite you: by cooperating and making joint efforts, you will certainly achieve the desired result.
Collaboration has its strengths and its challenges. First, let’s talk about the benefits of cooperation. If you need to open a business, it is easier to do it with a partner: adding money will give you additional opportunities. By cooperating with a partner, you get more ideas for business development, more prospects, as well as additional time for the implementation of tasks, because you can distribute responsibilities. Good business partners support each other, there is an exchange of skills, knowledge and experience, which helps both partners to reach a new level. In addition, partnerships usually increase the efficiency of decision-making. One problem is viewed from different angles: a partner can offer a solution that you have not even thought about.
However, as good as cooperation is, it also has its drawbacks. Partnership takes away some freedom from you: you have to reckon with the opinion of your partner. Also, sometimes when you can’t reach a consensus, it leads to disagreements. You may have different views on the management of funds and investment issues, and this is additional time for negotiations. In addition, you may have a divergence in ambition: for example, you want to build a company that will become a market leader, while your partner prefers a quiet life and does not support large-scale growth. In this case, it is better not to start a partnership.
In any case, small business partnerships are different from partnerships between large companies. In large companies, each solution goes through many levels, which requires a significant amount of time. On the contrary, in order for small or start-up firms to be able to stand and move forward, they need to make effective decisions quickly enough. Small companies are prone to risk-taking and innovative solutions in situations where large companies prefer to follow the charter and operate within a proven system.
However, there are quite a few companies that have succeeded in partnerships. Clothing company River Island, which has a total of 300 stores in the UK, Ireland, England, as well as other European countries and the Middle East, has joined forces with online retailer ASOS, which delivers products offered on its website to 170 countries of the world.
What did both companies get in the end? ASOS has a well-known brand on its site, and River Island can sell its product to a wider market.