Things to Consider When Selecting Strategic Partnerships
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When it comes to growing your business, one of the first things many owners consider is expanding their services. While this can be effective, it often takes substantial time, resources, and effort. One way to offer new services without sacrificing productivity is to form a strategic partnership with another business.
What Is a Strategic Partnership
A strategic partnership is a relationship between two business entities to create mutually beneficial results for each business involved.
Why You Should Consider a Strategic Partnership
Forming a strategic partnership can benefit your business in many ways, making it something worth considering if you’re looking to grow. However, the primary benefit of a strategic partnership is that you can quickly expand your services by working together with another business to better serve your clients and gain new ones. When done strategically, this enables you to grow in a way that doesn’t require a significant financial investment or a large time commitment.
Important Factors to Consider When Selecting Strategic Partners
Business & Goal Alignment
One of the most important factors to consider when choosing a strategic partner is whether or not your businesses are compatible. Evaluate things like company culture, services, operations, and goals to determine if these things align.
Remember, their services should fill in your gaps and vice versa. Partnerships should be strategically designed to be beneficial for both parties.
Leadership Accessibility
Communication is crucial in any business and business relationship. However, this is especially true in strategic partnerships. Leaders from both businesses need to be able to have clear and effective communication in a timely manner. This means leadership on both sides needs to be accessible to one another and have the capacity for regular check-ins.
Compensation Agreements
A strategic partnership, ultimately, should be mutually beneficial for both entities. Often that means compensation is going to play a prominent role.
It’s important to set up formal compensation agreements prior to entering into a strategic partnership so there is no gray area as to what kind of compensation each business will receive.
Trust
At the end of the day, strategic partnerships are built on trust. If your business is partnering with another to better serve your clients, you’re trusting that business to take care of your client the same way you would.
If that business drops the ball, it will reflect poorly on you and likely damage your relationship with that client in the future.
Conclusion
Choosing a strategic partner is one of the most important decisions your business will make. With careful consideration, your business can create a mutually beneficial relationship that will help you grow.
Have questions about strategic partnerships or how to get started? Our business advisory experts are here to help. Contact Us.