When it comes to business, partnerships are crucial for growth and development. Expanding the services offered through a lucrative business partnership can skyrocket revenue and customer numbers. It also does wonders for brand awareness and how potential clients see a company.
The problem is that not all business partnerships are lucrative or beneficial, especially for smaller businesses as the larger companies often take advantage of inexperienced managers.
Before you jump into any partnership, you want to evaluate the partner and the deal that is on the table. Here are some simple ways to do just that.
Is The Time Invested Worth It?
This is the very first question you need to ask yourself as a business owner. Many of the business partnerships proposed will require a time investment that is simply not advantageous when looking at all that has to be done and potential benefits.
Any business partnership needs to help the company to reach goals faster. If this is not achieved, you need to seriously consider declining the offer.
Learn As Much As Possible About The Business
Sometimes a business partnership is offered because the company is struggling and needs to get something for free. While in this case the partnership can still be a good one, it is important to analyze the proposal and the financial standing of the company making a proposal.
Fortunately, most of the information you will need is already available for you on the internet and can be accessed through a fast research.
Using such data helps the business manager decide if the counterparty is legit and if there are no hidden reasons why deals are proposed.
Start With Affiliation Partnerships
All partnership choices involve gray areas. You want to be sure that the deal will be a lucrative one so you have to look for a way in which a test can be made before the full commitment is made.
Affiliation stands out as one of the easiest ways to do exactly that. The idea is to be sure that partnerships do not dilute brands and that revenue proposals are actually as solid as they are presented on paper.
Transparency is also really important so do not be afraid to ask any question that might be in the back of your mind.
Find Potential Company Structure Conflicts
When a business partnership opportunity appears the manager needs to see if drastic company changes may be necessary. Aligning with company vision and structure is one fact that is often overlooked and that can lead to various problems when it does not apply.
Try to select those business partnerships that fit the company’s mission and structure. Do consider some changes but make sure they are not major!
This will help protect against numerous possible failures, including a potential loss of profits because investments would be needed to change company structure.
On the whole, the more you know about the company offering a partnership and the more you analyze how the deal would impact your company, the easier it is to see if the deal is one that is beneficial on the long run!