A strategic alliance is really just a business-to-business collaboration that can be formed for many reasons. As a small business owner, it’s important to understand the strength and benefits of utilizing strategic alliances, which may be overlooked during the process of developing new business and creating additional streams of revenue.
Small Business Alliances Produce Great Results
Alliances between small businesses can offer additional benefits aside from an increase in sales. For instance, small business owners within a strategic alliance who proactively approach large corporations on behalf of their membership base can secure better rates and additional services as a result of the alliance they’ve formed. If you’re a small business owner looking for products or services to enhance your business, chances are other small business owners are looking for similar opportunities. Why not form a strategic alliance and approach the product or service provider as a group to show there is a need and a market you are aligned in, with the hope of doing business with larger companies who are willing to work with you.
Capitalize Upon Merged Resources
Small businesses can combine their limited resources in order to appear in high traffic advertising areas than each business could afford to do on its own. For example, one small business-networking group decided to participate in a high traffic tradeshow on behalf of the businesses that chose to be involved. Using the banner of their combined membership, the group was able to absorb the tradeshow fees and cost of staffing the event, with each participating company taking a time slot and promoting their business, as well as the alliance that they had formed. Not only did the participating members increase their company’s visibility and gain new business, the networking group added new members that were unaware of their activities, which only served to increase the strength of the alliance by providing a larger member base to include in negotiations.
A business group of marketing professionals found strength in forming a strategic alliance amongst themselves in order to offer a more comprehensive service package to large clients than any of the independent businesses was able to offer on their own. While they had to deal with some service crossover, it was determined the size of the potential contracts outweighed what any one business would give up in revenue if crossover did occur. To handle the situation, it was written in the alliance contract that the company who brought the business to the table would have the last say in who would work on each contract and what the final compensation would be in the event of a crossover situation. The business owners were like-minded in that they all agreed to act in the best interest of the alliance’s clients first in order to provide a service level above and beyond the large marketing communications firms with which they were competing. By operating as a virtual team of experts, this alliance was able to increase business for all participating. They understood the strength in approaching large clients with a more comprehensive offering than any of them could offer independently.
Leverage the strengths of a strategic alliance on behalf of your business and tap into clients and resources you may not have thought previously available.