joint venture marketing
joint venture marketing
During the 1950s, Simplot researchers developed a method to freeze french fries, and the new engine that would propel the J.R. Simplot Company’s growth. Simplot, once a very small business with only a potatoes sorter, made great gains in the 1960s. During that decade, the company developed a partnership with Ray Kroc, a fast-food operator who became the single most important person in Simplot’s business dealings. The fast-food chain Kroc founded was none other than McDonald’s, which had a nearly insatiable need for the frozen french fries first developed by the J.R. Simplot Company a decade earlier. Simplot would go on to become the single largest supplier of frozen french fries to the massive hamburger chain.
Right Partner with the Right Connections
Having the right partner in a joint venture can effectively grow your business. If your company partners with another company that has a diversified consumer base than your own, you will able to beat your competition by selling to a larger target audience. You may be able to use your venture partner’s customer database to market your product, or offer your partner’s services and products to your existing customers. Your company can exchange endorsements with your partners companies, which will be featured in newspapers, on the Internet or on television. When entering into a joint venture marketing agreement with a reputable company, you will add more credibility to your business and gain potential customers’ trust in your company and products or services.
Building on their success in the past with join ventures, in July 2009, the J. R. Simplot Company and Agri-Trend Data Corp. announced a new joint-venture company called U.S. Agri-Data Solutions LLC (USADS) to deliver their proprietary Agri-Data Solution NetWare platform to agricultural producers and processors in the United States.
Shared Expenses, Greater Profit
Joint ventures often enable growth without having to borrow funds or to look for outside investors. When having a partner to share expenses with it will help your business grow faster, increase productivity and generate greater profits. A successful joint venture can offer access to new markets and distribution network, increase capacity, sharing of risks and costs with a partner.
In 2003, the Simplot opened a new state-of-the-art French fry plant in Manitoba in order to capitalize on the economic advantages the region had to offer, including the lucrative exchange rate between the U.S. and Canadian dollars.
Better Research and Development
An effective joint venture allows access to better research and development because the two companies can pool their resources in those areas which means less outsourcing while still enjoying a significant reduction in expenses. When developing a product or marketing and existing product, research and time put into a product means a better product. Better product development means your company will not have as many returns of the product from retailers or customers, in short more profit for your venture.
christian fea is CEO of Synertegic, Inc. A joint venture marketing firm. He exemplifies how to profit from Joint Venture relationships by creating profit centers with minimal risk and maximum profitability.
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