Business owners have a lot on their plates and figuring out the best way to grow is often one of the never-ending tasks that, unfortunately, takes up the majority of their time. There is a surefire way to grow your business without hiring a new department, allocating money into research and development, or even investing in new equipment for your business.
No, this isn’t a gimmick or sales pitch. The strongest businesses—both big and small—utilize a network of strategic partnerships to help them achieve growth.
What Is a Strategic Partnership?
Strategic partnerships are mutually beneficial relationships between two parties, typically businesses, who work together to grow and are usually are formalized by a contract. Not every partnership requires a legally binding agreement, though that is recommended if money is changing hands for referrals or revenue shares. In general, partnerships are most beneficial when your business serves the same customer set.
A great strategic partnership could be formed by a marketing agency and a graphic design agency, for example. These groups are usually serving the same set of customers and those customers are likely in need of the other’s services. As a rule of thumb, if your business is receiving requests for recommendations for the same service regularly, you may be able to benefit from a strategic partnership.
Your strategic partnerships can be as simple as a handshake agreement or can grow to be as advanced as a joint venture—though you likely won’t be participating in joint ventures right off the bat. No matter the level of complexity, there are many benefits to having partnerships in place.
Why Your Business Needs Strategic Partnerships
Most partnerships agree to share resources and create win-win scenarios for everyone involved—including the customers. You can collaborate with individuals, businesses, or even vendors to create these agreements. Individual and business partnerships will often lean toward referral programs with a goal of gaining new customers, whereas partnerships with vendors can be used to secure special deals, pricing, or even payment terms.
Strategic partnerships can be used in a variety of ways. You can simply share revenue if you refer a customer to another business who signs up for their service. You can also use partnerships to raise brand awareness or customer trust by partnering with established companies.
More than anything, partnerships should exist to serve your customers. The more you are able to connect them with partners who can help them achieve their goals, the better you’ll serve them.
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Start With Your Customers In Mind
When you’re ready to explore who you should partner with there are a number of things to consider but the most important one—you may have picked up on it already—is your customer. Ensure that you know who your customer is and their needs you aren’t currently capable of taking care of. In the case of the graphic designer, they know their customers are mostly small businesses and once the designers finish the fresh new artwork their job is done. Now what?
That customer probably needs to do a few things with their new art. They might need to get it up onto their website, print it on swag, or have new business cards printed. Rather than becoming a webmaster or a large scale print shop, the designer can enter into a strategic partnership with these providers who can take care of their customers’ needs.
Not all partnerships will be this obvious of a next step and you should get creative as you look at your customer base. Many small businesses face the dilemma of wanting to get their customers more services but not being able to provide them directly. Ask yourself what else your customers need to be successful. Would they benefit from your partnership with a local bank that can help them with financing? Avoid partnerships just for the sake of having them, but don’t be afraid to look outside of the box when exploring the possibilities.
Treat Partners Like Customers
As you build out this network of partnerships for yourself, you’ll want to ensure you treat your partners just like you’d treat your customers. They’ll be entrusting their own customer relationships to you, and you want them to feel confident about your ability to serve their customers with the same level of care. In turn, you want partners who will take care of your customers, too.
You should regularly meet with your partners and align on what would make your partnership a success. These are all good starting points to consider:
- Are you looking for customer referrals? How many?
- Do you want to strengthen your current offerings?
- Are you looking for increased exposure and brand awareness?
Partnerships should help you better serve and retain your customers and their business. If they know they can turn to you for introductions and solutions aside from the handful you already provide, you’ll strengthen your relationship further and ensure you’re able to continue working with them for years to come.
Interested in learning how to put your accounting on autopilot so you can focus on your partnership growth? Sign up for a ScaleFactor demo here.