SBTM October 2015 - Page 34

EDITORIAL FEATURE Choosing the Right Partner                       Connie Barnaba Y ou’ve already done everything you can to increase business efficiency, and, just when your competitive advantage is assured by your new capability allowing your customers to transact business online, another business you’ve never heard of announces a partnership with one of your strongest competitors. With a bigger competitor on the scene, there’s no escaping the fact that keeping your customers and growing your business will require you to take on a partner. It’s the first time you’ve given any serious consideration to sharing control of your business. It’s a high-risk proposition and you don’t know who you can trust. The theme to “Star Trek” starts playing softly in your mind as you begin to ponder going were no man has gone before. And then the music abruptly stops. You remember a list of very good reasons you’ve never gone there. Choosing a partner can seem like an overwhelming decision. First, there’s the challenge of designing a business strategy that differentiates your business from the other consumer options in your target market – figuring out what product or service or pricing will deliver more value to your current customers and attract new customers. After you have a strategy on paper, there’s the process of determining the strengths and weaknesses of that strategy. A new strategy is of negligible value if 20 other businesses can “copy it” capitalizing on your hard work and robbing you of your competitive advantage. This may suggest you need a partner that is willing to an exclusive relationship. When you are confident you have the right strategy, the search begins for a partner that is “a good fit” in terms of size and experience. “Good fit” is usually defined by what you’re looking for in a strategic partner. It may be that a smaller partner with a great product or service but with less experience in your market fits the defini32 SMALL BUSINESS TODAY MAGAZINE [ OCTOBER 2015 ] Choosing a partner can seem like an overwhelming decision. First, there’s the challenge of designing a business strategy that differentiates your business from the other consumer options in your target market – figuring out what product or service or pricing will deliver more value to your current customers and attract new customers. After you have a strategy on paper, there’s the process of determining the strengths and weaknesses of that strategy. tion if you are willing to provide training and increase the partner’s business revenues by exposure to your customers. It may be that another established business in the same market with a highly complementary product or service and clients that would double the size of your client base would be “a good fit.” Regardless of the strategy, in seeking a first-time partner, it’s always better to “test the waters” before making a full commitment. This could mean teaming up on one or two projects to see whether a strategy that works on paper works when it is “reality-tested.” Avoid partnering with any business whose financial strength is significantly greater than your own. Unless your business strategy involves becoming a reseller or selling your business as you exit, it’s never a good idea to team up with a stronger partner, exposing your business “know how” without any f ]\