Develop Your Joint Venture Strategy

A fundamental objective of a joint venture is to share resources to help each other's business grow in some agreed way. There are many reasons for entering into this type of business relationship, such as increasing your profits, increasing or diversifying your market and customer base, opening new marketing channels, or facilitating technology expansion. Because of the many advantages of joint ventures a lot of time is spent on research, planning and alignment of strategic goals to find and build successful business partnerships.

There are many examples of two or more entrepreneurs or companies coming together to build a partnership or form a venture for a specific business purpose and the following advice will help you to develop your joint venture strategy and increase your chances of success.

Set your joint venture strategy and goals

Before partnering with another entrepreneur or business, you must set your own joint venture strategy and goals and decide exactly what you want to achieve, such as whether it is more profits you are looking at, business expansion, or if you want to associate with another partner to enhance your standing in a particular market? Are there specific resources that you don't currently have that would help you to get to your own business objective in a shorter time period?

Be clear on your joint venture strategy and what you want before signing any partnership agreement, as this will also help you target your search for a suitable partner for your business venture. No matter the size of the business, the key to success is to aim for a win-win approach.

Build realistic plans

Carefully chalk out a plan at the beginning of the venture and ensure that any negotiation of the partnership terms should be for the mutual benefit of both or all the parties. You need to agree a common joint venture strategy, devise ways to attain the goal and agree on the appropriate type of business structure for the venture and if you already have a clearly articulated plan for this other businesses may be more interested in partnering with you.

Communicate openly and honestly

A key aspect of successful joint ventures is the open and honest communication between the partners and the cooperation towards the common goal. One of the key reasons that business partnerships fail is because the partners do not clearly express their expectations at the outset. It is always better to discuss any issues openly to avoid future disagreements and you should make this clear at the start of any discussions that you have with potential partners.

Document the terms

Always have a copy of the joint venture agreement in writing to avoid any confusion at a future date. Whilst the partnership agreement will help to clarify the strategy and the terms of the relationship between the parties, it is just as important to keep a positive attitude and balanced approach at all times to build and maintain excellent communication between the partners and avoid the requirement to resort to the agreement for clarification on certain aspects.

Review progress regularly

Just as it is important to agree specific goals when setting up strategic business relationships it is also very important to work out how you are going to track progress towards achievement of these goals. Schedule regular reviews of the progress of the business so that you can be certain that the partnership is on track to deliver the desired benefits for all parties.

By defining your joint venture strategy at the outset and combing this with effective planning and communication you greatly increase your chances of success.

You can get free private access to The Joint Venture Blueprint - an exclusive course on how to find and set up your own profitable joint ventures - at JVs360.com