If you consider yourself a smart business owner, you need to partner with another business. Many firms – big and small – have benefited from partnering together to undertake projects. For instance, in an attempt to quickly manufacture COVID-19 vaccines, the pharmaceutical companies, BioNTech and Pfizer came together to make one of the most effective COVID-19 vaccines ( a likely reason why you’re alive reading this post). Pfizer had the financial power to fund the manufacturing of vaccines but didn’t have the experts to make it. BioNTech on the other hand had the experts to make the COVID-19 vaccines but, not quite the funds. They came together with their resources and are making a lot of profits working together. If they had worked separately, they wouldn’t have benefited this much.
The example of Pfizer and BioNTech is why you need to consider partnering with other businesses when you see opportunities in your marketplace. Truth is, there’s a lot of fish in the sea for you, but your nets/boat may not be enough to bring them all out. That is why you need someone else to help you. If not with a bigger boat, then with a stronger, larger net to rein all your catch in.
Let me explain partnering with another business to you in two ways
- You may decide to partner with another business by bringing your resources together to complete a certain goal or project (As Pfizer and BioNTech did). OR
- You may outsource an area of your business (social media, marketing, payroll, etc.) to an expert so that you can focus on your strengths.
Whether you do one or both, partnering is a great way to achieve more together.
As an entrepreneur, you have a lot of tough decisions to make which will either make your business succeed or fail. Choosing someone to work with is one of those tough decisions. It’s especially tricky nowadays because people are hard to trust. But, I’m here to guide you with 5 tips to look out for when deciding to partner with another business.
- Are you fully on board?
The first thing to consider before you work with another business is what you are bringing to the table and your commitment to sticking to the partnership. If you don’t do this, you would end up making commitments that you may not be able to fulfil. This can damage your business’ reputation and ruin the relationship with your partner, and possibly future partners (you know how word travels these days). Therefore it would be wise to take steps to evaluate your business’ strengths and resources before making any commitments to another business. Although a partnership can benefit both parties if one party fails to fulfil their side of the agreement, things can get really sour, fast!
- What is their reputation?
The reputation of your business partner is very important. It will either add to the hard work you’ve already done to build your business or undo it all. Partnering with good and established businesses is often seen as an accomplishment because of the high standards they set for themselves. And let’s face it, they have systems in place compared to the little corner shop. Of course this doesn’t mean you should only look out for big, well-established brands to partner with. Look out for smaller brands with great reputation in innovation, customer service or product quality. Their goodwill will certainly rub off on yours!
- What is the cost? What are the benefits?
Every good thing comes at a cost and partnerships are no exception. Therefore, analyzing the cost of your partnerships before signing it off can save you a lot of trouble in future. What are the expected benefits? Will they outway the costs? How will the costs impact my business? If your analysis reveals that you have nothing to lose in a partnership, it’s possible you’re focusing on only the money. This is your cue to focus on other important benefits such as exposure and expansion of your customer base. Will the partnership add any value to your business in the long term? Answering these questions will give you a better picture of what to expect. This is a good way to avoid disappointments in future
- Do we have similar values?
Values are the principles or standards that the business may stand for. As a business owner, I believe you have some values by which you run your business. The business you may want to partner with will definitely have their values as well. That is why you need to identify the values you share and those in conflict. For instance, assume the business you may want to partner with is an advocate for female rights. You would have to ask yourself if you will be willing to compromise this for profits in an event that this advocacy may hinder/stall some business transactions. Knowing all of this will help set a good tone for the potential relationship ahead. It can help you move away from the partnership if you know you won’t be able to merge your values.
- Have I made my expectations clear? Do I understand their expectations?
You know what the Holy Book says: “expectations postponed make the heart sick”. So quick question for you, have you and your potential partner sat down to discuss expectations? Are they clearly written out? Do you know who’s doing what? For how long and the expected returns? Let me reiterate this, “don’t just speak on it; put it down in writing!” Also, don’t mince words. As you’re well aware, things don’t always go as planned. So, be sure to include what happens in cases of conflicts and unmet expectations in your partnership agreement.
I believe you’re armed to the tooth with all the relevant questions to ask before going to bed with another business. Whether you proposed the partnership or the other business did, you need to consider all these carefully to reap the best benefits from the potential partnership. Read this post for tips on how to end the year successfully