Building business partnerships is an excellent way to grow your business. Not only can they give you access to new clients, partnerships can help you expand your product offerings, get your product into new markets and help you strengthen weaker areas.Choosing the right partnerships is similar to dating, you need to find the right fit in order for the relationship to be successful. Effective vetting of potential business partners helps to lower risks and gives you a higher chance of success. In the end, business partnerships should be beneficial to both parties. Here are four steps to better vet potential partners before committing.
1.“Date” Before Starting Your Business Partnerships
By date, we don’t mean a romantic candlelight dinner. “Dating” a business partner is all about doing research. Like a date, you want to find out if your two companies are compatible.
The internet is the best place to start as clients are likely to have reviewed their service and had their say about any bad experiences. It’s important to keep in mind that people are more likely to write about a bad experience than praise a good one so there may be more good than bad. It’s less about what is being said and more about how the company has responded and acted to rectify the situation. The response to negative and positive comments will give you a clear indication of company values and management style. Additionally, check to see if there is any negative media attention or lawsuits that you should be aware of.
Look at their website and social media to gauge their clientele. Evaluate whether you have the same target market and if their customers are aligned with your ideal customer. See how they talk about themselves and if that matches what they deliver.
2. Follow Your Instincts
If something is not sitting well with you, trust your gut feeling. It’s no use wasting time on something you are not comfortable with. If you know what you are looking for and the potential partnership does not offer that, be willing to say no. Protect your company before being overly excited and getting distracted by early promises. If something feels wrong, there’s a good chance it is wrong.
3. Ask Tough Questions
Like dating, sometimes you need to ask tough and potentially awkward questions to ensure both parties are on the same page. Make your intentions and expectations for the partnership clear and ask your potential partner about their expectations. Make a point to find out about the business’s values and ethics, you should be proud to partner with them. Ensure that your business practices, ethics and values are aligned to avoid unpleasant surprises later on.
4. Ensure Commitment
For small businesses, the excitement of a potential big business partnership may lead to you running around for months without any real commitment. Ask for a small initial financial commitment to ensure that there is real interest in a partnership. There is no use in using up all your own resources in pursuing a big partnership while you are one of many options for them. Business partnerships should be mutually beneficial.
The potential for growth that strategic business partnerships offer is invaluable, especially for small businesses. Do your research and ask questions to ensure that your companies are aligned. Doing a bit of extra work will lead to a healthier, more successful, mutually beneficial business partnership.