Sunday, January 10, 2010

2010 and The Partnership Revival?

This year all of us are looking for ways to grow our businesses to recover some of what we lost in 2009. One way to grow a business that often gets overlooked is a partnership. Many small business owners avoid partnership like a plague because of past experience. We have all had a business deal, class project, or personal relationship that has soured our view of partnerships. Whatever the reason for your partnership-phobia, '09 put a lot of us in the same boat trying to generate business with little resources, and joining a partnership will allow you to do just that.

For those who may be unfamiliar with the concept an effective partnership offers many benefits to a small business owner, but the 4 biggest are listed below.

1) Partnerships don't result in the loss of decision making control- In a partnership both companies agree to help each other, but no one has to give up control of their own company. If company X and Y partner with each other, partner Y can't influence the decisions of company X and vice versa.

2) Partnerships focus on your core- In an effective partnership both partners should be focusing on their core business methods. As a result neither company has to dedicate "additional" core resources to the partnership to receive benefit.

3) Partners can come from anywhere in your channel- Good partners are not always companies in your specific industry. Partners can be your suppliers, your competitors, or other companies who share your customers, but don't provide the same products or services.

4) Partnerships have no upfront costs- An effective partnership provides benefits to both companies as a result of the collaboration. If one company has to pay upfront to enter into a partnership there is a fundamental flaw with it. Now this is not to say that a company can't receive compensation as a result of the partnership, my company provides financial incentives to our partners when their effort results in a sale for our company.

Ultimately every partnership is unique and can be structured to take advantage of all kinds of business needs. Cost cutting, revenue boosting, entering new markets, are all reasons to enter a partnership and are all problems we are trying to solve in 2010. So as a small business owner don't just assume you have to spend more or work harder to see results. Take the time to find a suitable partner and you might be surprised to see that you are working harder because you are back to being busy!

No comments:

Post a Comment