A strategic partnership happens when two or more businesses come together for a specific period of time in order to achieve a mutual goal.
Such a partnership usually involves the sharing of resources such as staff, data, information and finances. The Mutual Growth can help a business develop and choose a strategic partner. These are the things we consider:
• Location – We will determine if the business requires that a partner be nearby. Many times, growing a business through a strategic partnership may mean developing business in different times zones. Will the difference in time zones have any effect on the partnership?
• Brand alignment – Does the partnership require similar culture or values? The Mutual Growth will help determine the needs of the businesses and develop a partnership that shares the same core values and strengthens the brand.
• Complementary products/services – The Mutual Growth will help develop a strategic partner that sells complementary products or services.
• Target audience – Our strategists determine how best to grow a brands audience. Often, a partner should have a similar profile however, if the partnership is supposed to grow an audience, our strategists will look for complimentary synergies.
• Ability to deliver – To ensure mutual benefits - so everyone shares in Mutual Growth, choose a partner that is equal or greater in strength and size to your company.
Here are some benefits to a strategic partnership. 1. Increased capital Running a business usually requires investing a substantial amount of money. Raising this capital can be a very great challenge for an individual business. A strategic partnership allows businesses to put their resources together towards different ventures. In addition, it could enhance the chances of securing funding from financial institutions. This means that each of the businesses involved can meet their objectives faster.
2. Cost savings One of the major advantages of strategic partnership is cost saving. For instance, when you combine with another business to order supplies in bulk, you are likely to get a better price. In addition, you could cut your advertising costs significantly by undertaking a joint marketing campaign. You can also lower your expenses through joint staff training, and sharing infrastructure and transport facilities.
3. Faster growth Forming partnerships with other companies allows you to share operational and technical resources. For instance, if you are a manufacturer, you can partner with a company that has established marketing and distribution channels. This not only allows you to save money but also time which can be invested in innovation and your core business. This will boost your productivity and result in a more rapid growth. 4. International penetration Successfully penetrating international markets is a challenge that many businesses want to expand grapple with. However, a strategic partnership with a business in the target country can make things much easier. Such a partner is familiar with the business styles, protocols, cultures and even language of the foreign country. In addition, they probably already have useful networks which could be useful to your own business.
Despite the benefits mentioned above, a strategic partnership could fail due to reasons such as lack of trust, clashes in leadership styles, slow decision making, an imbalance between partners, and a general lack of strategic fit. Therefore, before jumping into any partnership, make sure you take the time to weigh the pros and cons and allow a Mutual Growth Strategist to assist you in making the best decision.