Every business does this. Whether small or big, I am yet to see a business without partnership.
Even if a business has no partner, it has employees, and those are partners bringing in different values that help in achieving business goals at the end of the day.
You need partners, of course. There is no way you are going to do everything by yourself. It can be too much for you to take. You will end up with so much food on your plate. You only bite what you can chew
Choosing a partner shouldn’t be difficult; it is just like how you chose a friend or a dating partner. You decided what compliments you; those areas where you are weak.
I haven’t been in many partnerships so I will just discuss the advantages that partners can bring. Those that I have seen and are obvious to everyone. I once attended a conference on business partnerships, and they said a lot of things that partnership can bring into a business.
And so to kickstart our list, here are some of the obvious benefits you can get from a partnership.
The first reason for partnerships is usually that of sharing knowledge and information. There are some things you know that other people don’t know, and there are some things your partner know that you don’t.
That’s the idea behind joining forces. You can be good at setting meeting with executives from other companies, and your partner is good at negotiating and closing the deal. This can make a perfect collaboration where you blend so well in terms of skills.
I hear that a good negotiator is hard to come across. It is like getting a good surgeon, and thus you can have the chance to meet investors or collaborators, and you need a partner to tag along with who is good at pitching and getting you a good deal.
In this way, you are not only sharing ideas but also skills. I could say skills is one of the most significant reasons for bringing in a partner; otherwise, why would you bring in someone new into the picture.
It is the desire to bridge the skill gap in the company or business that leads you to search for a backup.
This is another reason for partnering with another firm or business person. It is to get some funding. You can have solid ideas but lack the financing to realise those dreams or make them a reality.
If you have ideas, and your friend has money, then you can simply join forces to make these ideas a reality.
Finances can be a setback for many startups. All they need is a little sponsoring, and they are good to go.
Sharing the market is also a major reason for partnering. You can have some customers that another firm would greatly benefit from. And they can have some products you can bank on.
I think one of the greatest partnerships we have seen in the Kenyan market is between Safaricom and CBA bank in creating M-Shwari Loans. This is a classic collaboration.
CBA Bank had the money and idea of giving short loans, and Safaricom had the structure and customers to facilitate that idea. It is a great success.
Another good collaboration you can see in the market is between advertisers and companies. This is more of an outsourcing kind of idea, but it is still a collaboration. A company pays an advertising agency or a marketing company to brand them and put them into the market. This will lead to more clients.
I see outsourcing or consultancy as a great form of partnership too. Let’s say a company like EABL that makes the best beers and whiskies here. Supplying all that water throughout the country can be quite tasking. And that’s why they are using suppliers to distribute those drinks all over the country.
Distributors are an indispensable tool in helping firms in increasing sales.
The supply chain is very important in helping companies reach their clients all over the world. Companies like Nike invest heavily in their supply chain to capture customers around the globe.
A lot of partnerships happens in the supply chain unit of most businesses.
What is needed for partnership? Value exchange.
There ought to be equal value exchange between partners so that one side doesn’t end up feeling like they are benefiting more or less from the partnership.
Relationships are not really about give and take. They are about give and give. You bring value, the other side also brings a value equal to that, and both sides go home happy.
Value takes many forms; it can be in the form of money, skills, customers etc.
Good partnerships make businesses stronger by bringing in new business opportunities and help them thrive in the market.
The market is always changing, and you are likely to see big firms collaborating with the small fish to get something new. That doesn’t necessarily mean that big firms are not innovative; it just means that some of their ideas come from small firms, or are modeled from that.
Instead of firms competing, they would rather partner sometimes if the competition can hurt their businesses. Or just buy out young, fierce competitors.
A young company like WhatsApp was definitely working better at creating communities and sharing information better than Facebook. They were growing at a speed that Facebook could not match and thus, Facebook bought it.
In this technological era, there is partnering between companies in ways that doesn’t involve money, especially digital companies. Actually, it is a single sign-on process that just allows clients to transition from one firm to another seamlessly.
An excellent example of partnering in the digital world is the ability to move funds from one digital wallet to another. I can easily transfer my money from my Paypal account to M-Pesa or Equity Bank account. This is not really about profit but more of providing convenience to customers.
Like a match made in heaven, some partnerships are a match made in business and firms can benefit immensely from these collaborations.