No woman is an island. Still, when it comes to your own
business, partnering with others can be one of the most difficult decisions you
can make. No self-respecting entrepreneur wants to share the risks and rewards
of his or her business with an outsider, no matter how much they could add to
the bottom line. But in tough economic times, remaining competitive may depend
on thoughtful and strategic partnerships.
The right partnership can bring many benefits to your
business, including:
1.) Market Expansion -- Your new partner can
expose your product or service to a broader range of potential customers. You
will, of course, be expected to do the same for them.
2.) Cost Reduction – Partners can share
expenses and pool resources, including everything from advertising to rent.
3.) Product Diversification -- When
appropriate, a partner’s products may complement your own, and each of you can
offer a broader range of product to your customers, extending the reach of your
brand and increasing revenues.
As an entrepreneur it is always important to find and focus
on your niche, the one thing that you do better than anyone else. However, in
times like these it’s equally important to be flexible and diversified enough
to satisfy changing customer demand. Being open to partnering with other small
businesses can be a great way to diversify your offerings and increase revenue.
But be sure you are partnering with businesses that share your ideology
and customer demographic.
For example, a floral shop might consider partnering with
businesses that cater to its same demographic and whose products could be sold
in its shop or vice versa. Some potential businesses would be a gift shop, art
gallery, bakery, book store, or coffee house. By offering these other
products the floral shop is able to offer more to its customers, possibly share
in margin of these new products, and reduce its marketing expenses.
And by placing flowers in other store fronts, the floral shop can
gain more customers and increase its revenues and brand exposure as well.
When looking for a partner, be sure to ask yourself these
following questions;
Do they share a similar customer demographic?
Can they offer strength in my weaker areas?
Will partnering with them expand my customer base and
increase my revenues?
Is this partnership going to elevate my company’s brand?
Will this arrangement be short or long term?
Go forth from here and find your ideal partner(s) and tell us
about it. We’d love to hear how you are making your dream business work.
While I don't have a partner in my new business venture, I recently read a study conducted by Harvard Business Review researchers regarding partnerships. In it they say that if you want to be a successful entrepreneur, "your best bet might be to partner with entrepreneurs who have a track record of success", one reason being that successful entrepreneurs are "adept at selecting the right industry and time to start new ventures".
Posted by: Kerry Anne Ducey | February 05, 2009 at 09:15 AM