Watch a young pair of businesses begin to court…they see each other, and see the way the light shines off the other’s logo…they share secret grins, thinking about the future and how they will grow together. Then, with a signature, they are together…partners!
Well…don’t ring the bells and throw the rice just yet. Just as in relationships of the heart, it’s not quite that simple. While everything seems fine and dandy initially, if belief systems are different – mission, vision, values for operating, working with stakeholders, etc., the relationship could be headed for trouble.
Back up for a moment…who are your partners? What is the difference between your partners or allies, and your vendors? Hmmmm…it’s got to do with the relationship. In a partnership, you are co-dependant on each other for some aspect of the business. Ideally, your accountant, your lawyer, your insurance professional and your banker should be strategic partners that know your business intimately and can offer sound advice in decision-making. Are they dependant on you? Well…shouldn’t they be?
Traditional partnerships might be a business that has a product or service that is complimentary to your business, but might serve a market that you aren’t into, and visa versa. Another example might be a partnership to share resources to bring a new product or service to market. Another partnership might simply be one where the companies, through a synergistic relationship might have an opportunity to expand both of their product or service offerings.
On the other hand, vendors might include Staples, Wal-Mart, your phone company, etc. These are folks that you’ll shop every time you purchase from them, they aren’t very worried about your business, other than to provide you with whatever standard they offer, and you will switch vendors as your business needs change.
I’ve worked with businesses who would partner with anyone (or hire anyone) with a beating heart, or a business that had any complimentary products or services what-so-ever. They might, then, offer a huge suite of products or services, or take off on a new venture, half-baked. Unfortunately, I have seen as many partnerships dissolve and businesses close as a result of poor planning or poor background checking.
There was a marketing company I once worked with, who had great market presence. The owner had operated the company for about 10 years. He was a great marketer – not just an advertising, or graphic design guru, but an actual marketer. He was the type of person who would not simply sell you business cards or postcards. He made it very clear that the collateral was only one part of the marketing process, and helped businesses create a full marketing strategy. He was good.
However, he was not a web person. He reviewed his SWOT (Strengths, Weaknesses, Opportunities and Threats) and found his lack of web savvy to be a weakness – an area where his business couldn’t compete, and a threat – market trends were moving, heavily towards the internet. Therefore, he set out to solve the issue, and did so by collaborating with a web design company that offered products and services at the same level of service.
Well…the numbers looked good. They saw many great opportunities for each other, joint products, shared costs, shared employees…it looked like a match made in heaven. However, their belief systems were different. It hurt both businesses, to the core, to the degree that although they’d invested tens of thousands of dollars in a new project, they were forced to abandon the project before it ever came to fruition, end the venture and close the business. Both reputations were tarnished and I suspect there were legal proceedings shortly thereafter. Had they courted for a bit longer, looking below the surface, though they may not have partnered, they might still be two, strong, viable businesses.
While it is never an easy task to go through the “courting” process – (we want everything now, now, now!!), just as in a life partner, it is a necessary part of the process. We, as entrepreneurs, are known for risk…but there is risk, and then there is foolishness.
Love with reckless abandon…but partner with the Wisdom of Solomon.
At Aepiphanni Business Solutions, we are dedicated to serving the needs of small business owners. We specialize in helping you develop strategies for your organization, and are committed to your success. If you have further questions about creating your strategy or developing your vision, please give me, Rick Meekins, a call at 678-265-3908, or email us at [email protected].