Ten Types of Business Partnerships You Can Create

Are you considering a partnership with a Web-based company? Why? Is it because they're promising that you'll make lots of money after you pay?

The Web-based "distribution partnership" model is often presented as a private label offering. For example, you decide to buy a license to operate a technology for a flat or time-based fee with the promise that you could profit from product or service sales to visitors of your private branded, pre-fab website. But, in nearly every case, you are responsible for finding, luring and selling prospective customers. Bottom line: this type of partnership may be nothing more than a purchase, a disguised network marketing scheme or a franchised property with few if any franchiser rights.

Unfortunately, you've bought into a deal that gives you no control over how many duplicate franchises are out there. In addition, it is a deal without recourse. The franchiser may not deliver all it promises. The lucrative market the franchiser touted may not be there or may take years, not months, to build. Unless you already have an existing customer base, the entire venture may be a pipedream. If you're an actual distributor or seller with a customer base you should be able to partner with legitimate companies who are picky about authorizing you into their "distributor partnership" network.

Before you engage in a real partnering effort, be sure your expectations are valid. Do you have good reasons to partner with other businesses? You should. Do you know enough about your partner? You should. Beware of the wrong deal or the wrong partner. But don't be scared off. Partnering may be a very lucrative path for revenue growth and innovation development.

Your partnership strategy should be your plan. It has to fit your business model, your business goals. It should be attainable. It should be undertaken with partners who add to your company's value and growth objectives.

Take a look at the ten reasons I provide below. There are many more variations on these themes...but if at least one or more of these alliance models make sense to you, start doing homework on partners potentially suited for your purpose.

Here are ten solid reasons for engaging in value-creating partnerships:

1. Customer Access – Two marketers exchanging access to compatible customers.
2. Sales Initiatives – Producer or marketer working in tandem with a sales force organization, retailer or Web store to increase sales.
3. Market Expansion – Partnership aimed at penetrating new or niche markets.
4. Unique Value Alliance – Marketer with strong customer base partners with innovative supplier adding unique value to the marketer’s offering and increased sales for the supplier.
5. Scale Building - Partnership formed to achieve economies of scale.
6. Innovation and Specialization – Public, education or private enterprises combine financial and knowledge resources to research and develop innovative or specialty products, services or solutions.
7. Supply Chain Stability – Marketers trade exclusivity with suppliers in exchange for investment in quality, cost reduction, and priority speed to market; The supplier is able to make long-term commitments at stable levels and pass on the benefits to the marketer.
8. Distributor Partnering – An alliance between manufacturers and distributors to provide access to new markets, domestic or foreign, or strengthen a position in existing markets.
9. Convergence and Fusion - Two or more manufacturers of component parts, technology, content or delivery providers pool their resources to produce a better product, service or solution.
10. Licensing Agreements – Alliances providing license to proprietary products, support services or technology.

Don’t be swayed by promises your partner may not be able to keep. Don’t be sucked into deals offering revenue you may never see. First, define your own partnering goals. Second, find a compatible ally. Before you start negotiating with anyone, conduct the appropriate due diligence to be sure they are actually capable of delivering up their end of the bargain.