joint venture marketing
When two business entities enter into a partnership, this is a joint venture. The defining factors of this union are equal risk and equal reward. That means that each party will divide the costs evenly, and will also share the profits. The parties may enter into a legally binding agreement that covers the responsibilities and expectations of each, but lets get started by having a more complete understanding of a joint venture.
Who should I partner with?
At times, choosing the right joint venture partner can seem overwhelming. After all, you have a company to run. If you have your own research and development team, they can help find good prospects that will help your company develop into its next level of success. However, consider that there are joint venture brokers who can do this job for you. After collecting information regarding your company’s vision, they will help you find the best match for you particular goals.
What form of Joint Venture is best for my company?
A joint venture will most commonly take the form of a corporation, a limited liability company, or a limited liability partnership. Many things should be considered when choosing which is right for you. Each of these have different tax implications, and it is recommended to consult a tax professional in deciphering the best fit for both parties.
Where do I find the right company to partner with?
You’ll have to ask yourself what parts of the country or Internet you’d like to reach. Once you have made a determination as to where you would like to see your business expand, then you’ll have a better idea of where to begin your search for potential partners. If part of your company’s vision is to become international, then a joint venture may be required. Many US businesses must form joint ventures with international companies in order to do business in those countries.
When is the right time to partner?
You’ll have to take a good honest look at your company. Consider the timeline of your success. Where did you begin? Where are you now? Where do you see your company in 5 years or even 10? After grasping that perspective, explore the key components needed to reach your short-term goals, and then your long-term goals. If partnering with a company can help you meet those goals, then now may be the time to form a joint venture.
Why a Joint Venture?
Entering into a joint venture has known benefits. The first and maybe most appealing of them is the concept of spreading the liabilities between the two parties. Most businesses are willing to put in their share of equity; feeling assured that the other party is equally invested. As the saying goes, people follow their money. Because of this, a joint venture is a more secure form of partnership since both entities share the risk. Each party’s reputation and profitability depends upon both doing their part to succeed.
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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