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Find Small Business Partnership Opportunities
Relationships Build Partnerships
Identify Good Business Opportunities
Finding the best small business partnership opportunities should be top of mind for most business owners that want to develop channels that can drive in customers and result in increased sales. It can take a significant amount of time to identify, evaluate, and negotiate a deal yet it is critical to first find businesses with great potential as it sets the foundation of whether a deal will be successful in the long run. Without quality target companies the search for the perfect partner will never be fruitful. Creating a partnership with a business that does not align properly can be detrimental and even a major cause of stress and wasted resources. Young companies can gain significant advantages by having a strong business partner and the reverse is true with a bad partner quickly resulting in business failure. While setting up partnerships with companies that are a perfect match can produce new clients for years to come it is never easy and the hard work begins in the early identification of potential partners. Get ready to start doing your homework! There are several factors that need to be considered when evaluating a potential company to do a deal with and while some others may be more important based on the industry and location of the companies these are all important issues to be conscious of.
5 Factors for Partnership Deal Success
- Mutually Beneficial - If a business deal does not provide incentives and benefits to both companies it will likely quickly fail. Business relationships that are heavily one sided can last for a short time and prove to be very fruitful but will likely die in the long run due to a lack of commitment by the company that feels it is being taken advantage of.
- Open Communication - There needs to be an open line of communication between both the executives of the two companies and the individuals that have to work together in order to quickly isolate problems and resolve them when something may occur. It is best to have a cheat sheet with contact information in case someone is not in the office on a specific day issues do not fester and get delayed being handled.
- Trust - the best way to build trust is to outline specific dates and agree upon items early in the contract / legal phase of a partnership negotiation and then stick to them. If there is a need for shared financial information develop a method that will work with both businesses so that their is complete transparency regarding the success or failure of the deals ability to drive revenue for both companies.
- Compatible - It is critical that business partners be compatible with one another on several different fronts. While it is common to think about market compatibility some of the factors that are not thought of as much include, company culture, regional areas of focus, sales cycles and customer service support expectations.
- Lack of Competition - The best alliances that a company can develop with other businesses are when they are purely benefiting the objectives of each other. While it may be necessary and advantageous to create a relationship with a company that may be a competitor in the future, avoiding this as a small business owner is very important.
Signing a Partnership Contract
Partnership Due Diligence
It is critical to conduct a thorough internal due diligence of every partnership opportunity. While no single answer should be the one reason for a yes or no decision to move forward, each executive team should consider the following items and compare against the needs of the business. Every partnership is developed with unique intentions and goals and so one business entity may be a better fit based on what the goals and requirements of the relationship.
1. Existing Customer Base - How large is the customer base of the perspective partner? Do they maintain sales force the local areas that need to be saturated? Are the customers loyal? How often do customers use the competition for similar product / service? What are the personal demographics such as education, financial, age, gender?
2. Markets local, national, international - Where does the potential partner company operate? In markets away from headquarters is there local sales offices or partners? Percentage of revenue based on markets?
3. Brand Awareness How strong is the brand? What kind of social media brand does the company have? Has there been any significant negative mentions of the brand in the media recently, if so make sure to evaluate why this occurred and how the company took action to resolve the issue. Is the Brand known - Locally? Nationally? Internationally?
4. Size of Company - How many employees does the company have? What is the basic organizational chart for levels/ departments you will be interacting with? If they will be selling and delivering your product the size of sales team and understand transportation and logistics for company.
5. Complementary Products & Services - What products and services are offered? What products and services would be good fit for business deal? Conduct a thorough competitive analysis of the perspective companies product lines. Do they have products that would fit well for your customer base immediately?
6. Financial Situation - Is the company financially stable? Is the company privately held or a public company? Has there been recent negative financial stories about the company in the recent past? Have any of the key executive management team left? If yes it is good to understand why.
7. Existing Marketing Campaigns - How does the company market its products and services? How has the company executed promotions and partner products in the past few years? Review all online and offline marketing activities. What is the companies existing marketing budget, and how is it divided?
8. Existing Relationships Between Executives - Who do you know within the company? Finding a business partner with a company that already has ties on some level with existing executives can be very important especially for a small business that may be betting its entire existence on the success of a new partnership. Does any of your employees have relationships with the perspective partner or previously worked there? Include LinkedIn connections that exist between you and your staff networks.
9. Conflicting Products & Services - Any products or services that conflict with your offerings? Any existing partners products or services conflict? Is there any products or services that would not be a good fit for co-branding?
Many of these questions may be difficult to answers through typical online searches and research, it is possible to get a decent picture of a business and the individuals that will be conducting the meetings from the other side prior to having formal partnership discussions.. During the initial meetings and interactions between the two businesses it is important to be identifying the important characteristics of a business to determine if they are the right candidate for a strong partner that can execute a business deal that results in success. It will be during those first meetings that it is possible to fill in the blanks regarding the partnership and size up the company and whether it will result in a mutually beneficial relationship which is the goal of any business partnership that is intended to be long term and prosperous for all involved.