Business Partnerships and Alliances - Business Networking[/b]
Business is all about relationships and connecting the dots.
Business associations are useful in narrowing and finalizing the perfect partner. Most of the services are available online and one can start by registering and researching on the potential partners. These service providers have already done the due diligence part and take care of the hassles in forming alliances.
Business To Business Event [/b]
To present yourself and your venture a different one from others is very important. It will make you noticeable in front of others. Attend interesting and exciting seminars, meeting, forums, clubs, groups which will help you to increase your business network. Strategic alliances are formal partnerships between businesses which help the businesses achieve a set of goals.
Many startups decide that the best way to rapidly expand their business is to enter into strategic alliances with established companies which serve a different but similar market. The many benefits of strategic alliances are listed below:
Access to distribution channels
Access to technology, expertise or intellectual property
As a means to raise capital
New products for your customers
Lower R&D costs
Economies of scale
Raise brand awareness
Disadvantages of Strategic Alliances
The problem with strategic alliances is that there are a number of problems which must be overcome for them to be a success, including:
Incoherent goals, with one business not benefiting greatly from the agreement
Insufficient trust, with each partner company trying to get the better deal
Conflicts over how the partnership works
Potential to reduce future opportunities through being unable to enter into agreements with your partner’s competitors
Lack of commitment to the partnership
Risk of sharing too much knowledge and the partner company becoming a competitor
Having approached a company, discussed the possibility of establishing a strategic partnership, and agreed in principle to proceed, the next step is to draw up the agreement.
A written agreement is essential to ensure that everything is clear from the start. It will help to prevent arguments arising from misunderstandings and also help both businesses get the most from the partnership.
A good strategic partnership agreement should cover the following:
Aims and Objectives
What are the primary and secondary aims of the strategic alliance, for both businesses? Clearly specify the aims, such as revenue generation, cost-reduction, or to increase your customer base.
Non-Financial Contributions
What will each business contribute to the partnership aside from financial commitment? For example, there is usually some form of cross-promotion, such as widespread prevalence on each others’ websites and visibility on new marketing material.
Financial Commitments
It may be the case that one business is making a financial commitment in return for certain things supplied by the other business. This financial commitment may help to even-up the partnership in instances where one business is gaining more than another. Always try to specify the amount of investment to prevent the business providing finance attempting to cut costs.
Ownership of Intellectual Property
If you’re starting a new venture together intellectual property, such as logos or even inventions may be created. Always specify who owns this in the agreement to prevent costly arguments arising when the partnership comes to an end.
Evaluation Dates
The reason for establishing a strategic alliance in the first place is to benefit both the businesses involved. Therefore specify certain dates on which the partnership will be evaluated. This ensures that if one business isn’t benefiting greatly the issue can be resolved at a specified date rather than allowing problems to foster.
For a straightforward strategic partnership between two businesses where the purpose is to be mutually beneficial a simple written agreement should be sufficient. The main problem that is likely to arise is one company feeling that they are getting the raw end of the deal, but this is nothing that cannot be resolved through negotiation.