As your business becomes more profitable, it is possible you will find yourself needing to develop four types of partnerships:
- Strategic alliances with non-competitors
- Strategic partnerships with competitors
- Joint ventures
- Independent contractors
There are three key motivations for developing these partnerships. First, a partnership with someone outside your company can help you by reducing cost and sharing assets. If your business is preparing to offer an information product online, partnering with someone with a large following can reduce your expenses for marketing significantly. If your company is hosting an event, partnering with a company that owns space and is willing to share for a small percentage of profit might be more cost effective than renting the space on your own. Another reason for partnering with others is to reduce risk in a competitive environment. Two competitors can come together to share resources on a project in order to leverage their combined assets and present a stronger, more valuable offer than either could provide alone. Finally, your company might want to create partnerships in order to acquire specific resources or services. Rather than try to be all things, keep your focus on what your company does best and outsource the rest to independent contractors who can fill the gap. Solo-entrepreneurs who realize early that they need to utilize virtual assistants, bookkeepers, house keepers, and other service providers will find their business becoming more profitable more quickly.
The key to creating mutually beneficial partnerships is putting roles and responsibilities in writing and regular, clear communication. Need help in developing a written agreement for your suppliers and partners? Contact me for a complimentary strategy session and free template at email@example.com.