Whether you’re a seasoned CEO or a new business owner, partnerships are key to your success. But especially when the economy is on shaky ground, establishing mutually valuable ones can be difficult.
Partnerships allow you to team up with other companies in your space. They can help you save money, acquire new customers, and provide external support to clients who need help outside your core competency.
Partnerships are vital to your company’s future. Here are six ways they can elevate revenue during in times like these:
1. Partnerships Let You Share Resources
Do you have strong connections with professionals in your industry? Do you have access to the best software? Do you have an impressive social media following?
If you answered “yes” to those questions, consider how much you could gain by offering those resources to an allied company. You’d expect a similar amount of resources in return. You and your partner can share assets, expertise, and opportunities.
Let’s say you’re forced to cut costs, so you stop paying an advertising consultant. Instead of giving up your ads altogether, you could turn to your partner to advertise your business. This way, you’re still able to reach your target audience — even when you can’t afford to financially.
Alicia Vargo, CEO Of luxury lingerie store Pampered Passions, made that exact move. After giving up print and radio ads, she turned her attention to alliances with bridal shops, photographers, plastic surgeons, hospitals, and post-mastectomy clinics. She cut costs and brought in more business as a result.
2. Partnerships Shore Up Weak Spots
No company is good at everything. Before you go looking for a partnership, make sure you understand what your company needs to succeed. Your goal should be to find a partner that can cover gaps that your company may struggle to fill itself.
Take procurement. A partnership with a purchasing cooperative or group purchasing organization like Una is a great way to support companies without sourcing experts on staff. According to whatisagpo.com, using a group purchasing method motivates suppliers to give members discounted pricing, which can help procurement teams get quick wins for a good price.
With that said, the fit is key. Ask yourself: Does the partner share my values? Do their services complement mine? If a shared customer gets upset, will the partner have my back?
3. Partnerships Grow a Customer Base
You’ve heard the saying, “What’s mine is yours.” Well, that’s true when you have a partnership. If the economy is making it tough to reach new customers, working with a partner can help.
For example, the ride-sharing app Uber has partnered with music-streaming services Spotify and Pandora. According to Uber, drivers have played more than 60 million songs — which translates to over 4 million hours’ worth of music — since the partnership began.
But it’s not just Spotify and Pandora that benefit from the partnership. Think about it: If you have Spotify or Pandora, would you pick the service that lets you listen to your favorite tunes on your trip or not?
Expanding your customer base through partnerships is easier than doing so through sales. Plus, you can grow your company’s credibility and exposure — especially if you partner with a big-name brand like Uber.
When you strike such a partnership, promote it. Encourage your partner to do the same. Highlighting your partnership can help you net even more customers through the arrangement.
4. Partnerships Provide Access To New Technology
Partnerships help reduce costs by giving companies access to new and innovative technologies they may not be able to afford on their own. Especially for smaller companies, that can make a night-and-day difference inefficiency.
Do you want a better way to analyze your sales data? What about a more robust marketing system? The right partner can give you what you need.
Remember, too, that technologies take time to learn. A partner can walk you through the tool in a way that feels more hands-on than a sales demo. Not only does that save money, but it saves staff members time and headaches.
5. Partnerships Let You Offload Responsibilities
Taking advantage of your allies is never a good idea. But if you’re working on a project with a partner, don’t be afraid to ask for their help.
Take BMW’s partnership with designer Louis Vuitton. For a top-notch travel experience, BMW needed to design more than a car. For help with luggage, it turned to Louis Vuitton.
Whatever you’re working on, why not let a partner give you a hand? Your company will be able to focus on what it does best, and your partners can do the same. Another reason why it’s important to choose partners who bring something different to the table.
Besides the day to day tasks, your partners will also share in the financial responsibility. If you suffer, there’s a chance they’ll suffer too. However, if you succeed, so will they.
6. Partnerships Can Help You Stay Afloat
When things get dire, the right partner can keep your company’s head above water. Through their connections, they might be able to attract an investor, talented hire, or helpful consultant.
Don’t rely on partners for the survival of your business, but do grab a life preserver if it’s thrown to you. Be sure to communicate your gratitude through a gift, referral, or another point of value.
With that said, avoid tying your company to a sinking ship. If you suspect a company has chronic financial issues, don’t strike up a partnership until you’ve done a thorough review of their finances. By the same token, be open with your potential partners so they can be confident in your company.
7. Partnerships Enhance Company Culture
Partnerships aren’t just about external relationships. As long as you share values, partnerships can also give a boost to company culture.
For example, Target and the United Nations Children’s Fund (UNICEF) partnered together on a 2015 campaign called Kid Power. For its part, Target sold child-friendly fitness trackers to encourage kids to get active. Not only did that lift sales, but it made its team feel good about helping out kids in need.
What about UNICEF? Its staff got a glimpse of the for-profit world. The nonprofit gained everything from efficiency hacks to new networking opportunities.
In tough times, strategic partnerships can make all the difference. And even in good ones, what company would say no to more customers, fewer risks, expert help, or access to new tech?