What is a strategic partnership?

There are many things business owners need to do. Trying to figure out how to grow their business is often one of their most difficult tasks. However, there are ways to increase your business's success without adding a department or investing in research and development.

This is not a sales pitch or gimmick. On the contrary, big and small, the most robust businesses use a network of strategic partners to achieve growth.

Strategic Partnership

What is a Strategic Partnership?

Strategic partnerships are mutually beneficial relationships between two businesses. They are typically formalized through a contract. Although not every partnership needs to be legally binding, it is recommended for those involved in revenue sharing or referrals. Partnerships are best when you serve the same customers.

For example, a marketing agency could form a great partnership with a graphic design agency. Both agencies serve similar customers, so they are likely to need each other's services. A strategic alliance may be beneficial if you frequently receive requests for recommendations for the same service.

You can make a simple handshake agreement or develop it into a joint venture. However, likely, you won't be involved in joint ventures immediately. Nevertheless, there are many benefits to having partnerships, no matter how complex.

Why your business needs strategic partnerships

Partnerships often agree to share resources and create win/win situations for all parties, including customers. These agreements can be made by collaborating with vendors, individuals, and businesses. Referral programs are a common approach for both business and individual partnerships. The goal is to gain new customers. Partnerships with vendors can help you secure special pricing or terms.

There are many ways to use strategic partnerships. Referring customers to other businesses that sign up for your service can result in you sharing revenue. Partnering with established companies can help you increase brand awareness and customer trust.

Your customers should have partnerships. You will serve your customers better if you can connect them to partners who can help them achieve their goals.

Keep your customers in mind when you start thinking about them

You need to think about many things when looking for a partner. However, the most important thing--and you may already have it--is your customer. You need to know your customer and what their needs are. Graphic designers know that their customers are small businesses. Once the artwork is completed, the job is done. What now?

The customer might need to put the art on their website, have it printed on swag or print new business cards. Designers don't have to become webmasters or large-scale print shops. Instead, they can form strategic partnerships with providers to meet their customer's needs.

Some partnerships may not be so obvious. You should look at your customer base and think outside the box. Many small businesses find themselves in a dilemma where they want to offer more services to their customers but cannot do so directly. Consider what your customers require to succeed. Is it possible for them to benefit from a partnership with a local bank that provides financing? Remember to be open to exploring other possibilities.

Treat Partners as Customers

As you create this network of partnerships, you will want to treat your partners the same way you treat your customers. You will trust your customers' relationships and want them to feel confident in your ability to provide the same level of service. Likewise, you want your partners to take care of customers.

Regular meetings with your partners are a good idea to discuss what you think would make your partnership successful. These are good points to start with:

  • Do you need customer referrals? How many?

  • Are you looking to expand your existing offerings?

  • Do you want to increase brand awareness and exposure?

Partnering should improve your ability to serve and retain customers and their businesses. You'll build a stronger relationship with your customers if they know that they can turn to them for solutions and introductions beyond the ones they already have.