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, small business partnership with large business which is an established one.
There are three aspects to setting up a partnership:
- Choosing a company
- Partnering with the company
- After-partnership stage
Choosing a Company
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 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.
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.
Partnering With the Company
Once you have chosen the company, here’s how to partner with a company.
Break The Ice
Don’t let your fist 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 ask for a business partnership? These questions can be answered by only identifying What makes yours 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 in 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!