Partnerships have grown to become an important aspect of the corporate growth strategies of various businesses with a good number of executives setting aside up to 20% or even more of their assets for the generation and maintenance of partnerships. In this current globalizing economy, a strategic partnership between your business and another organization could help your business combine knowledge resources, expand your product lines and do more than you could have ever imagined doing on your own.
You can elevate support and credibility for your business through a strategic partnership; partnering with a trusted organization that is also well-known could improve how the public perceives your brand and enhance visibility for your business as well. It could help you significantly in attracting support and building trust if your organization is non-profit.
A business partnership can help you cut administrative costs based on your business’ financial needs. One way this can be done is by sharing workspaces as it saves money, increases visibility for your business and it also encourages collaboration. This could also result in department and staff sharing, which could be great for building a vendor program of your preference.
Introduction to a different audience
This is one of the leading reasons for businesses seeking new partnerships with other organizations. Up to 68 percent of executives have listed acquisition of a new audience or market for their businesses as a primary advantage of an effective alliance. Your business could be involved with new vendor-supplier partnerships, develop an ongoing deal with new export/import firms and do even more in an effort to boost market share and access.
Natural cross-promotion will give you a chance to easily reach the other organization’s network. Given the nature of the partnership, the partnering organization could feature you on their social channels, website or even provide regular communications to their community.
Another benefit of a strategic partnership would be an expansion of your business’ geographic reach, which, in turn, steers back to acquiring a new audience for the business. It is one of the top 3 advantages that businesses which enter into partnerships are looking for. 32% of executives have listed expansion of geographic reach as one of the leading goals of their business partnerships. It is closely related to getting new revenue channels and access to a brand new customer base and it is more often than not the first step to take if you are looking to make new and significant growth in your business.
Once you have expanded your market and customer base, one can make steps towards an extension of product lines. A collaboration of this nature will give you the tools you need such as market, knowledge, and materials which will enable you to extend your product line or diversify your products.
Going into a partnership with another business will enhance brand awareness among a completely new market that your business probably has not had the resources to get beforehand almost automatically. In most partnering cases the partnering organization will be one that provides your business with an entirely different set of services to a market which is similar to its own. This gives your business an opportunity to increase your market size with little effect on the business itself.
A chance to boost the market size with a partnership gives you the added advantage of increasing awareness for your brand. One of the primary elements of your business’ success is consistent growing brand awareness. If this is not the case then this could be a red flag for your business because it shows a lack of growth. A business partnership will give you a chance to access a broader audience without you having to put in more capital and extra time.
Businesses are consistently looking for creative new ways to increase their customer base and get access to potential new customers in the process and forming a partnership with an organization will help you do just that. This is because being in a solid, trusting partnership will grant you an entirely new customer base which your business would not have been able to access otherwise.
Economic Benefit
An increase in profits for your business can come from various sources, some of which include several promotional strategies and getting new customers. Partnerships are probably the best way for your business to boost profits and attain success for the long haul.
More than 65% of senior executives consider increased revenue to be one of the biggest advantages of a successful partnership which should be your goal in the long run as a business owner. Once you enter into a strategic partnership your resources and those of the partnering business should start to complement each other and both of your vital objectives should align; this way, as partners, you will be able to offer each other new market access which will result in new revenue streams.
You can decrease risk and costs for your business by spreading them across the members of the partnerships. You can also get greater economies of scale by entering into a business partnership because of production volume could increase, which could result in a decline of cost per unit. In a business partnership, you can take advantage of co-specialization with your partner(s) by combining your specializations to generate additional value.