How to build strategic partnerships: Your go to guide in 2023
A strategic partnership in business refers to an agreement where two or more companies share resources that provides benefit to all the stakeholders involved in it.
Businesses that get into a strategic partnership agreement are generally not direct competitors but rather have complementary services or products.
Building strategic partnerships can open up new possibilities for your business that you previously did not have access to. The goal is to find relevant business partners who have a similar vision or target audience as yours.
Partnerships are extremely fruitful when both business products or services can be used together to give the consumer more benefits and an enhanced experience. There are many types of strategic partnerships that a business can forge with another.
A marketing partnership is one that involves two companies helping each other in a way that markets their products or services to new customers.
This can be solely promotional in nature or also involve more in-depth marketing distribution at play.
One of the most common examples is that of niche agencies partnering with each other on a referral basis.
A design agency and a tech agency have overlapping products and services that often need to be executed together for a client.
In such cases, a marketing partnership between these two companies would entail the tech agency forwarding any design work requirements to the design agency and the design agency would refer the tech agency for any development work.
Another type of marketing partnership could be in the form of co-hosting an online or offline event where the customers and potential customers of both brands are exposed to each other.
This helps both the companies get in front of new prospects while already having built perceived credibility and trust thanks to the brand you partnered with.
A marketing partnership can also simply be a promotional video ad made together by two or more brands.
Supply chain strategic partnership agreements are some of the most common business partnerships you will see especially for tangible products.
There might be instances where you realize that another manufacturer can help you produce goods for you at a much lower cost if you take semi-finished goods or raw materials from them instead of trying to handle the entire manufacturing process yourself.
On the flip side, you might have a business that is really good at manufacturing a product but you lack the distribution resources to make it reach customers.
In this case, you would partner with a company that is well-connected with supply chains and can help you distribute your products across different regions.
These types of partnerships are entered and agreed upon majorly because of the cost benefits that both parties will get out of it while still maintaining the quality of output.
A financial partnership refers to when a company outsources its financial or accounting management to a specialized firm that can handle all accounts.
This type of strategic partnerships are very important when you as a business owner don’t have the time to do it yourself or hire an accountant for it.
This type of strategic partnerships are a very common one in the digital age.
An integration partnership usually involves two software companies or a software and hardware company integrating each other’s product or service to give the end customer a better experience.
An example of this is Volopay’s expense management platform having the ability to integrate with commonly used accounting software like NetSuite, Deskera, Xero, and more.
This not only helps the finance team of a company easily manage all expenses but also syncs the data seamlessly with an accounting team thanks to native integrations.
An example of integration between the hardware and software of two companies is that of Nike and Apple.
This integration partnership took place back in the 2000s when the companies decided to become strategic business partners and launch Nike+.
This program included certain pairs of shoes and apparel from Nike that were integrated into Apple’s software technology to track health and fitness through iPhone and watch devices.
Many businesses might have a technological requirement that is quite costly if an in-house team is to be built; but at the same time, you can’t do without it.
In such cases outsourcing and entering into a technological partnership with an IT company that can provide you with the same service at a lower rate with their expertise and scale makes sense.
Many companies might need a digital backend infrastructure to manage their business operations and important metrics for which a SaaS tool is not enough.
In these cases, an IT company can help them build a custom digital infrastructure and enter into a technology partnership to maintain them as clients to manage, update, and see to it that all IT requirements are met.
Before you set out looking for partnerships, you need to set clear goals as to what you are looking for and how these partnerships would help you.
Knowing how many partnerships you want, what you want from them, and what you can give others in the form of a partnership will help you set clear goals.
What is it that you are looking for in a partnership? Answering this question for yourself brings clarity of expectation for you as well as the potential partner.
Without establishing clear expectations, issues might arise in the future that can hinder the strength and integrity of your partnership.
The keyword in ‘strategic business partners’ is literally all three words.
The collaboration must be strategic, meaning it should be well thought and there should be a reason behind doing it.
It should be business oriented, meaning there should be a potential metric-oriented output or outcome.
And finally, it should be a partnership, meaning both businesses involved should have equal or agreed upon say in how the collaboration works.
An agreement should entail the scope of your partnership.
The strategic partnership agreement would act as a document for both the teams to understand their responsibilities, and necessary tasks to be done, and also outline what resources would be shared between the companies for the partnership to be a successful venture.
The value of a brand in the world we live in today has a lot of power and influence over people.
Becoming partners with the right brand can exponentially increase your company’s brand value as well.
But it should be an authentic fit and match rather than a forced collaboration as people can easily see through fake partnerships that are clearly only for monetary benefits.
Having similar brand values is also a consideration that your business should make for a fruitful partnership.
When people ask “How to build strategic partnerships?” the first thought should be to network more often and build relationships.
Successful businesses are built on relationships. Relationships that are fostered over time. And successful partnerships are a part of building better relationships.
Building strategic partnerships with other companies give you exposure to new audiences and new markets that were probably not aware of your business previously.
Getting this top-level awareness with people is very important for your business to get potential prospects to consider going further down your marketing funnel.
The best part is you are not paying for ads or any other form of marketing but rather just leveraging another company’s audience by forming a partnership with them.
Building strategic partnerships allows teams and individuals in companies to share resources and the knowledge they have with each other.
Learnings from one company shared with another can be extremely beneficial for you to test and apply for your business.
And your business can do the same to help out the business you have partnered with. Remember that there’s no point to wisdom if it is not shared and used to help others.
By building strategic partnerships with another company, you partner with them for business reasons. But an indirect and unavoidable association is created in terms of your brand image when you partner with a certain company.
This can be a good thing or a bad thing depending on what the perception of the brand is in the public eye.
So always choose to partner with businesses that have built a good reputation for themselves. When you build a good brand image for your company, other brands will also approach you more willingly.
Volopay is an expense management software that helps businesses literally save time and money using a fully integrated suite of financial tools such as corporate cards, an easy-to-use mobile app for employees, and our web platform.
We have already partnered with industry-leading companies such as Stripe, Canva, Zendesk, Airmeet, Freshworks, Xero, Mailmodo, and so many more businesses.