How to Grow and Scale Your Business Utilizing Partnerships
From GoPro and Red Bull to Apple and MasterCard, we've seen numerous successful partnerships that take both companies to new heights.
Each company was independently successful and renowned, but by forming a partnership, the companies were able to reach new customers and expand their market footprint.
Below are some other examples of businesses using partnerships to grow even stronger:
Starbucks and Spotify
Nike and Apple
Taco Bell and Doritos
BMW and Louis Vuitton
But a partnership doesn’t necessarily have to be a partnership between two companies.
It can also be a partnership between two people.
One of the most famous case studies is Apple. Though Steve Jobs is the name we typically associate with Apple, his business partner and founder was Steve Wozniak. The two eventually parted ways, but without the partnership of Jobs and Wozniak, Apple wouldn’t be the powerful tech juggernaut that it is today.
Other famous partnerships that helped businesses scale are:
Hewlett Packard: Bill Hewlett and Dave Packard
Google: Larry Page and Sergey Brin
Ben and Jerry’s: Ben Cohen and Jerry Greenfield
Twitter: Evan Williams, Biz Stone, and Jack Dorsey
Utilizing partnerships to scale and grow isn’t just limited to Fortune 500 companies. In fact, startup companies and mid-sized businesses are among the biggest beneficiaries of strategic partnerships. Below, we outline what perceptive business owners need to know.
Why Consider Partnerships as a Way to Scale
Though small and mid-sized companies can benefit the most partnerships, they are also the least likely to enter into these business relationships.
Most small businesses are extremely personal in nature. There is a lot of sweat equity and personal investment put into these ventures. Mid-sized companies are also often family businesses that have been built over multiple generations. The idea of giving up any control can feel breathtakingly painful.
Yet for businesses that want to grow and scale, few things are potentially as powerful as a strategic partnership.
A partnership exposes the organization to a new realm of ideas, collaborators, and resources. In a world where problems are multiplying, the strongest solution is to multiply the problem solvers. Internally, this means that the business will need to hire the right people with the right skills. Externally, this means that a business partner can help the organization expand its network to mutual and shared success.
Partnerships will provide you with the opportunity to grow your customer base and improve your business while doing so. Typically, partnerships happen between businesses in related (but separate) industries. After all, it makes no sense to partner with a competitor. For example, an auto manufacturer might partner with an apparel brand since there is likely overlap in target audiences, but neither organization will “steal” business from the other.
But gaining new customers is just one of many benefits.
A partnership could provide you with access to new products or technologies, identify new customers, block a competitor through making the move first (through an exclusive contract), or building brand loyalty.
How to Ensure Value is Delivered for Both Parties
A partnership is a relationship on steroids, but the keys for success remain the same.
So what makes a successful relationship?
Trust and Transparency
To ensure that your partnership is a success, it’s critical that you have a shared vision for the future. Now, a shared vision doesn’t mean that your visions of the future are identical. Rather, it means that your objective is true synergy that provides for mutual success. Ask yourself the following questions: Do our brands share similar values? Do we have the same company cultures? Do the independent locations of our businesses make sense for a partnership? Do we have complementary products and therefore related target audiences? Do both organizations have the ability to deliver on their end of the bargain?
Answering these questions will ensure that you enter into the right partnership in the first place.
But beyond that, a partnership (just like a relationship) must continuously worked at to ensure that value is delivered.
If you’re reading this, you clearly care about your business and are invested in its long term growth and success. You are going to do what it takes to make sure that your business continues to deliver to its customers and therefore deliver success to your partner.
However, trust and transparency are key to making this work. Whether it’s quarterly reports or monthly board meetings, you’ll want to keep communication channels as open as possible. This will provide ample opportunity to prevent miscommunication as well as ensure that both parties are simultaneously on the same page.
Looking Long-Term: Scaling Through Partnership
The key to scaling your business through a partnership is to always look ahead. The long-term view of things serves two purposes. First, it helps you see potential areas of growth and opportunity. Secondly, it also helps you foresee any potential pitfalls, giving you ample time to strategically position your business to face those challenges.
The rapid growth that ensues from a partnership will create new problems and challenges that don’t currently exist. This will create a stress test of your internal efficiency and processes. Thus, it is important to approach a partnership with a mindset not only of growth, but adaptation and evolution as well. If a partnership is successful, neither party will walk away looking the same.
Did You Know…?
Did you know that there are different kinds of partnerships?
Some partnerships (such as two separate brands collaborating on a product) are more obvious than others.