Joint Ventures: Pros and Cons for a Small Company Working with a Large Company

joint venture marketing

joint venture marketing

When deciding whether it’s the right move for your company to enter into a joint venture project there are many things to consider. When two companies of about the same size enter into a JV marketing project, it is much safer for both parties. However, when a very small company is approached by a large company to team up, there are different risks and benefits they’ll need to consider that two companies of the same size do not have to think about.

The opportunity for a small company to join with a large company on a joint venture marketing project presents the small company with many benefits that it might not be able to acquire otherwise. The larger company’s revenue is going to naturally be more than the smaller company’s intake, making it possible for the smaller company to make a great deal of money on the venture. The large company would not be interested in the project if it was not going to make enough money to be worth their wild, meaning that a successful venture will result in a large amount of revenue for both companies. While the larger company would be able to make that amount of money in other fashions, the smaller company would not, making profit the number one advantage for a smaller company to work together with a larger one.

A joint venture marketing project also presents the smaller company with the opportunity to expand its business. There is a good chance that by completing the project, the smaller company will learn skills that will aid in the expansion of the business. The small business may also be put in contact with other businesses through the venture that it would not have otherwise had contact with. This could also aid in the expansion of a small business.

However, there are also risks involved when a small company decides to work with a larger company. While a larger company would be able to go weeks, or even months, without seeing any profit from the venture, a small company would not be able to easily survive that long without getting paid. Also, unless the larger company agrees to pay for more of the project than the smaller company, it will be a very expensive venture for the smaller company. Even if the revenue at the end of the venture is great, the smaller company might not be able to survive until the end. Because of this, detailed time lines are essential when companies of two different sizes team up together. The project usually needs to be completed in a short stretch of time so that the smaller company is not injured.

It is also possible that the larger company will completely absorb the smaller company. This could be an advantage or a disadvantage. Some small businesses do not want to join larger ones, but instead prefer to remain small. However, if a small company is looking to become part of a larger business permanently, then it is possible a joint venture marketing project with a larger company will ultimately result in this.

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.

To discover more joint venture marketing Strategies join his free report on joint venture marketing.

joint venture marketing

joint venture marketing

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