Creating Strategic Partnerships in Joint VenturesWhen creating strategic partnerships in business, it is important to consider what each party can do to benefit the business venture, and how certain joint ventures can contribute to the bottom line of everyone involved. Here, we discuss several examples of the ways creating strategic partnerships creates advantages that would not be available otherwise. Often, a person or business has a range of expertise that it can comfortably operate in. To expand or start something new may be a great idea, but the qualifications for the enterprise may be lacking in a certain area. Example: Tim, a construction worker with 25 years experience, has come up with an innovative idea for resurfacing walls that results in less cost, less time and a better quality outcome for the customer. Tim hears that Sandy that can help him get the idea to market, because he doesn’t have the faintest idea of what he needs to do to make money on it. Sandy knows nothing about the construction industry or resurfacing walls, but she does know a lot about starting businesses and marketing products and services. Tim and Sandy enter into a strategic partnership where Tim provides the valuable knowledge, Sandy packages it into a website, ebook, “hard” book, instructional CD and related course materials. Tim does the classes, and sells the materials in “hard” form, and Sandy sells online. Upshot: Tim’s idea and knowledge about the particular subject were there, but he did not feel comfortable or qualified to package the idea commercially. He also did not want to let the idea languish by taking the time to figure it out on his own. Sandy had the knowledge about getting the product to market and how to package it for commercial success, but didn’t know anything about the subject. Together, they can create an income stream that they would not have been able to do separately. Alternately, the qualifications for entering into the partnership may be roughly equal. However, both parties strength may be combined to create an entirely new income stream which would not have been as powerful, or interesting to the consumer, separately. Example: Two well-known business tycoons, Donald Trump and Roberty Kiyosaki, form a strategic partnership to write a book offering their respective views on business ideas. While they largely agree on what it takes to be successful, their differing attitudes and approaches offer a new, marketable book title to an audience eager to get rich. Could they write a book separately, and will it sell? Of course—both have several books on the subject of making money and getting rich already, and those books have been successful. The difference is, with both of their perspectives being laid side-by-side, it offers a parallel view of two extremely successful businessmen—a subject we never seem to get tired of. There’s no question these two uber-entrepreneurs understand the value of creating strategic partnerships. See Why We Want You to Be Rich by Donald Trump and Robert Kiyosaki. Upshot: This scenario is what is often referred to as a “promotional partnership.” Even if you and your partner have similar strengths, you can add an additional income stream by entering into a joint venture to re-package your product in a way that is seen as new or innovative to the public…or in a way that is appealing because the public sees it as a “two-(or more)-for-one,” and therefore assigns it a higher value.
Ultimately, there are many ways to discover multiple income streams--and you can incorporate joint ventures or partnerships into your business plan to add another dimension to your business.
Click here to return to Joint Venture-Partnership Page
|
