You wouldn't marry a stranger, so why go into business with one?
Not every business in your market needs to be a competitor. Partnering with businesses that have the right brand synergy and similar markets could actually work to your advantage and expand your customer base.
One way you can do this is by using networking opportunities to bring like-minded members together and start a conversation that could dramatically transform your business.
But you can’t just rush straight into a partnership. According to Bartercard, at least half of all partnerships fail in the first 2-3 years.
That doesn’t mean you should go solo – it just means you should conduct due diligence and gain an understanding of what you could be in for.
And who better to ask than business owners who have been on the front line of partnership failures. Here are some of the top tips to help your next partnership have the best chance of success.1. Complementary skill sets
It might seem intuitive to find partners that have similar skill sets. That could actually be detrimental because there isn’t enough diversity, which leads to failed partnerships. If you have a diverse and complementing skills mix to draw from, your partnerships are more likely to succeed.
2. Similar values and vision
Your values and your partner’s values will impact your venture’s outcome. You need to know if your partner is willing to put in the work, and how they will react when times get tough – will they stay committed or bail?
Not every partner will agree on everything, but partners should still share a similar vision.
Bartercard explains: “One partner may be reliant on carrying out the next commission, whilst the other is thinking big picture and building the customer base. These differences may quickly become a deal breaker to make your partnership unstick.”3. Communication
A communication breakdown can be fixed, but it’s much more difficult if there was never great communication to start with. A lack of communication often reflects a lack of planning. Plan every step, variable and worst case scenario and always keep your partner informed.4. If things go bad, have a dispute and exit strategy in place
Bartercard explains: “Peace of mind is knowing you have a feasible exit plan. An exit clause in your agreement defines what happens to intellectual property, profits, debts, clients and other considerations, in the event of, or when, the partnership venture ceases. This is particularly important if partners bring assets to a new venture which they wish to retain. Add a sound and clear dispute resolution clause into the formal partnership agreement and seek a mediator if necessary.”
And don’t forget that partnerships evolve, but should only do so at a pace you can manage. So who will you partner with in 2019?
Bartercard is offering a free eBook to help you grow your business with new customers. It includes tips on growing online communities, networking, creative ideas to increase occupancy, and content marketing for SEO.
Registering for the eBook is easy – click here for more details.