The partnership is one aspect that lends a competitive advantage to any business. A partnership can be between any two parties - businesses dealing with the same or different products, two divisions within a company, between businesses of different demographics, etc. But here we will be dealing with a specific kind of partnership, a small business partnership with large businesses which is an established one. So let us have a look on how to approach a company for partnership and different aspects to setting up a partnership.
Aspects to Setting Up A Partnership
Choosing a Company
Companies have their own reasons for being in a partnership. Sometimes people get into a partnership for capital, sometimes for expertise, and sometimes for connections. If these expectations are not fulfilled can strain the partnership. The motive, vision, and values for the companies are different, it is important to discuss before signing the contract. Also, a clear dissolution and modification plan needs to be made as needs and expectations change over time.
Be clear with what are needs of your company or what problem you are facing right now. Is it distribution, product design, or reaching the demographic? Understanding the problem right will help you shortlist the right companies to partner with.
You need to find a company to partner with. But it cannot be just any company. A sound partnership involves great cooperation and mutual benefits. The partnership need not be with your competitor. It can be a company that commands an entirely different area. Take the recent Starbucks-Spotify partnership for example. Make a list of the big partnership companies you’d like to partner with. Email them to see if they would be open to a partnership. Also, be ready to face a lot of rejections at the start. The key is to be patient.
Business- Matchmaking Programs
This is a matrimony conference for business. Utilize the various business workshop-conference-seminars held all over the country. You must attend them and by doing so you might gain valuable contacts, the know-how from people in the field, and a list of companies looking to partner.
Scout companies online. Most corporate have a strong online presence. Read their content and understand the way to approach companies with partnership potential. Let a business know that you admire their strategy, or congratulate them on a successful launch on behalf of your company. People respond well to compliments and are mindful of the people who make their day. Leave a trail in the minds of people you want to strike a partnership with.
It is important to find companies whose goals align with yours. The goal need not be product-specific. Take for example RedBull and GoPro. RedBull is primarily known for energy drinks and GoPro for its portable cameras. Both companies are associated with adventure and action. This led them to partner and mutually market products. The partnership can also be based on a campaign-sustainability, women empowerment, body positivity, and pride.
The way a company works can be a game-changer or deal-breaker for the small businesses looking to partner. If you want to expand your business to reap profits, find a cut-throat company with a killer business strategy. If you want to increase your brand popularity, partner with a company that has visibility. Work ethics can be stringent. Don’t pick a company whose culture violates yours.
Understand the partnership
Clearly define why you want the partnership. Understand what you can offer and what you want out of it. A rookie mistake would be to sign over the intellectual property rights of your project without something more substantial in return. Consult a lawyer to translate all aspects of the agreement from the lawyer- to layman-speak. Beware of hidden clauses. Stay aware of how the partnership proceeds and speak up when you feel unethical practices are occurring.
Once you’ve decided on the type of help your startup needs, you can start looking for the right partner.
Partnering With the Company
Once you have chosen the company, here’s how to convince a big brand to partner with you:
Break The Ice
Don’t let your first meeting be about the partnership. Building successful partnerships means having an unorthodox means of contact first. Remember a few compliments I mentioned above? A tweet in reply, or commending their efforts publicly are good ways to go. An informal conversation is a good start. A good first impression of the business owner will increase the chances of a partnership.
Have a pitch ready
If the first informal meeting hits off, and they are interested in partnering, you can’t be empty-handed! Have a pitch handy. Strive to make it different. Corporations deal with hundreds of partnerships. How to convince a big brand to partner with you? how to partner with a company? How to ask for a business partnership? These questions can be answered by only identifying What makes your business unique? How will your company benefit them?
Thus, anticipate questions and have answers ready. Being unprepared will not convince the company of your seriousness. Hire a person if necessary to prepare your pitch in such a way so as to convince the company.
What You Have To Offer
Layout your terms and be very clear. Leaving room for misinterpretation and loopholes will backfire. Make sure you can uphold your side of the agreement. Understand your capacity before making commitments. Don’t offer anything that you might regret later. Trading property rights for equity might seem like a profitable advantage, but then you would lose the innovation process and freedom to extend your product lines exclusive of the company.
What They Have To Offer
When you sit with them to brainstorm, try to understand how your product can help their company. Be it helping their process, image, or any other aspect. You know best about your company and they know best about theirs. Work together to ensure a smooth journey. There is a bonus point if both teams get along better than on a business level. To be on the safe side, have a lawyer look through for any possible areas of misinterpretations or loopholes. And also, if the exchange is mutually advantageous monetarily. An idea good on paper might not necessarily be profitable, so prepare the questions to ask before becoming a partner in a business beforehand. Be thorough before you finalize the partnership.
It is always better to approach a person you know in the company and test the waters rather than jumping right in with the business emails. The contact might give you insider advice on the company’s work methods and how you should go about nailing the partnership. Personal contacts are your first point of contact with the company and might be willing to help you by lending credibility to your business if you play things right.
The head of the company meeting the partner every day to carry out the partnership is impractical. Instead, a liaison for this specific purpose seems a better choice. Someone who is naturally good at corporate relations and is enthusiastic about the partnership is ideal. That person must also be aware of the ins and outs of both companies as well as the partnership agreement. The liaison’s actions can affect the agreement so be sure to choose carefully.
Your Company’s Capacity
A partnership is exciting. A partnership with your dream company? Best ever. But know that enthusiasm is not a substitute for resources. Missing a deadline pre-partnership would only mean the loss of one customer, and even then the customer might accommodate you. Missing deadlines post-partnership where you provide products/services to the corporation may make them lose customers which can hugely impact them. So don’t overextend your employees and resources.
Once the agreement placed well, here’s what you need to do to strengthen your company’s foundation; not just as a partner but also as a successful business after the partnership ends.
Add It To The Resume
A successful partnership is a feather in the cap. When looking for partners in the future, make it a point to mention past partnerships. It will not only show that you have experience in the area but also make them more willing to think of you first when an opportunity arises. Stress on the highlights of your partnership and how both of you were able to achieve your goals. And it’s not always a bed of roses. Talk about the parts where you struggled and explain how you overcame them.
Contacts Within The Company
Don’t limit yourself to your point of contact. Interact with people from all divisions of the company. Who knows, you might find a person who introduces you to your future business partner. Despite that, it is good to interact with individuals and the company as a whole.
Partnerships are akin to marriages, they have to be a match made in heaven. An uncooperative partnership will have both companies incurring losses while repairing mistakes. A successful partnership on the other hand will do wonders for both partners. On this note, I wish you, happy partnering folks!
Tips For Successful Partnerships
Here are listed plenty of tips for you to create a successful partnership:
Identify Your Strengths And Weaknesses
What are you good at? What do you do well? Your partner should complement you. If you focus on exploring out people who have different skillsets from yours, you’ll be stronger together than you are apart. Don’t be scared to be dependent on your partner. In a good partnership, both people bring something equally important to the table.
Discuss Your Long-Term Goals Upfront
Are they similar? Are they compatible? You might disagree about how to get there, but you and your partner should share the same vision. The crucial question to answer is, will you both be able to achieve your goals by working together?
Define Your Roles Explicitly
You don’t want to overlay in your efforts. Before you get started, form out who is responsible for what. These roles may change over time for both partners. But they must be verified upfront to avoid conflicts.
This piece of advice seems obvious, but it’s very important. How do you communicate? How often do you communicate? Is it working for both of you? Setting a recurring time and date will help facilitate talking about any problems that arise -- which inevitably will.
Remember That no One Likes Surprises
When in doubt, don’t be afraid to get your partner’s approval. Ask for their reviews or ideas too.
Respect One Another
As all know, we all have strengths and weaknesses. Don’t misuse or take advantage of your partner’s weaknesses just because you can. It’s not worth it.
Put Things in Writing
Having an operating agreement in place will help clarify your goals.
Pick Up The Phone.
Using email to communicate about important matters is a surefire road to disaster. Tone and intention are too easily misinterpreted.
Take Full Responsibility For Your Actions.
Take full responsibility for your actions in partnerships whatever you do.
If you Make a Mistake, Admit It Quickly.
The sooner you cop to an error, the more quickly you will both be able to move on. Your partner will appreciate not having to call you out.
Don’t Let Your Discontent Fester
You will feel worse, not better. If you avoid airing your grievances, you will begin to blow things out of proportion. Get what you need to off your chest.
Define What Small Problems vs Big Problems Are
Not everything is a big problem. Most things aren’t. It helps to be reminded of that.
Support One Another
If you find yourself secretly wishing your partner ill will, something has gone fatally wrong. Partnerships are a never-ending work in progress. Don’t let issues that arise be swept under the rug. They always bubble to the surface anyway.
Frequently Asked Questions
How to convince a big brand to partner or how to convince a company for partnership?
Tips to convince a company for partnership:
- Be unique.
- Remain persistent.
- Think big.
- Plan for fast growth.
- Prepare for scrutiny.
- Build on existing partnerships.
What are some examples of big partnership businesses?
Small business partnership with large business Examples:
- GoPro & Red Bull.
- Pottery Barn & Sherwin-Williams.
- Casper & West Elm.
- Kanye and Adidas.
- BMW & Louis Vuitton.
- Starbucks & Spotify.
- Apple & MasterCard.
- Airbnb & Flipboard.
How does a general partnership work?
A general partnership is a business made up of two or more partners, each sharing the business's debts, liabilities, and assets. Partners assume unlimited liability, potentially subjecting their personal assets to seizure if the partnership becomes insolvent. Partners should create a written partnership agreement.
How do I partner with a big partnership companies?
5 steps to take to successfully partner your startup with large partnership companies:
- Define what you want out of a partnership.
- Know what you bring to the table.
- Find a personal contact at the larger company.
- Make sure goals align.
- Be patient.
How to Find Partners for Your Startup?
- Make a List of Your Goals as every startup has short-term, long-term, and stretches goals.
- Consider Your Needs (Once you know where you're going, you have to figure out how to get there).
- Consider Their Needs.
- Know Where to Look.
- Have a Reasonable Timetable.
- Stay Organized.
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