When businesses think about team building, business owners usually affiliate it with building their particular company s internal workforce into a lean-mean preventing machine. Team building, however, ought to be extended to include external human relationships such as those with other organizations. Enter joint ventures or JVs abbreviated.
Joint ventures generally are usually business partnerships established in between two or more parties (individuals, business groups, companies, corporations) for the purposes of expanding the business and achieving merits by joining causes and working as a team. The parties involved in joint venture agreements enhance each other, leverage each other s property assets, compensate each other s weak spots, and at times equally talk about risks.
Less than 5% of businesses truly use joint ventures properly and most don t even use it whatsoever. In order to get the most out of shared ventures correctly, multiple elements such as choosing who to partner with, approaching prospective partners correctly, negotiating the win-win deal for all parties involved, and having a well-coordinated execution must be taken into consideration.
There are several types of shared ventures. Big companies may possibly join forces to become even more powerful and thus dominate the market, even though small companies may synergy to build a stronger profile in their market niche in order to fend off bigger, resource-rich companies. JVs may also be used to gain access into overseas markets. Foreign companies often form joint ventures using indigenous companies that are already found on the market, but lack funds or financing to truly take advantage of the market potential. Foreign firms can bring money, new technologies and also competitive strategies into a partnership deal, while benefiting from the actual relationships and the brand of the actual domestic company.
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These complementary partnerships benefit all the organizations involved if set up appropriately with the right partner. Here s a powerful but simple example of the JV that many businesses may take advantage of to grow their business fast. It is a highly successful method of increasing business revenue by teaming up with yet another partner whose business is non-competitive and will be offering a highly valuable asset, an extremely responsive client list that would be interested in your products or services. By making use of this hidden goldmine, small enterprises can save thousands of dollars in marketing expense to reach their targeted clientele while achieving the aim of boosting the bottom line. The business offering the vehicle in which to reach these clientele, the client list, benefits from offering complementary services and products that it does not sell and makes a cut of the sales generated from marketing to this list.
Here are 5 tips for partnership success:
- Choose your partners carefully. A joint venture has greater chance of being successful when partners have an excellent status. An essential component to good team building is having the right partners. They must be dependable and have a high level of strength.
Joint ventures involve intensive team building effort because it is a relationship between two parties and if the relationship is to last, it must be nurtured and kept proceeding. Both parties must be able to rely on each other and deliver on each other s promises. To find the right spouse, perform solid market research and also approach only businesses you need to do business with long term. If you want to kind a partnership with a certain company, make sure that its business practices are in-line with your own house. It would be very difficult for you to kind a reliable team with people who lack motivation or dependability, so you should look for well-trained, open-minded prospective partners.
- Know what to expect from the beginning of any JV relationship. Know from the start what your goals are, what you want to accomplish, and find out if your goals are attuned while using partner. Each company should make a marketing plan and obviously specify what is expected off their potential partners.
Plan your strategy ahead of time and make sure anyone cover all the legal aspects stipulated in your joint venture contract, like resource availability and also management, special allocations, mutual gains, deductions and earnings issues. Stick to the business advancement plan and establish brand new priorities and goals because you progress. By efficiently controlling resources and by maintaining a great, competitive business policy, you may secure the longevity and the success of your business.
Draft proposals like mini-sales letters. Compose a professional proposal letter explaining the advantages of the joint venture in a convincing way. Keep it brief, clear, concise and defined while briefly introducing your business and why they should work with you. Remember to tune in to the air station your prospective JV partner listens to, WIIFM or What s Within it For Me.
If you want to propose a joint venture to anyone you need to give them a really good reason why they must do it. Otherwise, they will more than likely decline your proposal. Big, successful companies receive numerous joint venture offers so you ought to stand out. You should educate all of them about the advantages and the benefits of choosing you over the others. If this partner happens to be a dream spouse, stay persistent as determination demonstrates sincerity and determination to make it work for the potential JV partner.
- Avoid shooting too high with your offers. If you?re a smaller business, do not targeted your offer to a huge company first as it probably will be thrown away. Instead of striving too high at this point, establish profitable joint ventures with modest companies in order to get noticed from the bigger, powerful ones. Establish the reputation as a solid business owner who knows how to turn shared ventures into gold for their partners. Businesses naturally gravitate toward successful businesses. Remember to toot your personal horn by announcing JVs through press announcements and/or articles in trade magazines. As your business expands, the competition are going to become aware of your presence, and there?s a chance that powerful firms might come up with proposals regarding joining forces with your firm.
- Be honest and available with all business transactions always. Once you?ve negotiated the details of the partnership, the actual work begins. So as to keep things going, a lot of rely on, understanding and expertise are expected for ongoing team building on both sides. Maintain an open dialogue try to address issues upfront just before it becomes a bigger problem in which threatens to break up the partnership.
These are the basic rules for shared ventures and it is ultimately your decision to see whether a deal will be successful. Learn with each partnership deal to improve on the subsequent deal. Deals can only be made in case you go after them. With lots of effort, you ll develop enough expertise to become a joint venture expert and acquire your business to the next level.
Tags: business, powerful, trade, transactions, work
Source: http://www.tveyemagazine.com/5-tips-to-successful-shared-ventures
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