The life of entrepreneurship is full of wild rides in pursuit of revenue and customers. The world is ready to tell you which ads you should run or which social media posts you should manage. Some entrepreneurs do not have an endless budget and time to invest in their businesses.
It’s good to have thought of collaborating or partnering with other organizations. But the question is, whom to collaborate with?
However, it’s better to confirm one main thing for sure, do not collaborate with an organization that has the same business plans or nature. Instead, ensure both the organizations have different business ideas to avoid unwanted competition. The first step toward collaboration with other businesses is to know your business and understand your strengths, weaknesses, opportunities, and threats. This way, you can determine the gaps, the goals you want to achieve, and the partner you will synergize with to achieve your goals.
There is a common saying that has a deeper meaning. ‘If you want to go fast, go alone. If you want to go far, go together.
What makes you collaborate?
Customers are fragile, and the market is volatile. The most effective way for businesses to overcome competitive challenges and obstacles is to collaborate. The decision is to be made on time before it’s too late, after conducting proper research and analysis. There are multiple reasons for a business to connect with another. Some are listed below:
- The most obvious is when your business is not getting customer recognition.
- When sudden external changes enforce into business.
- Risk in credibility, sustainability, and profitability.
- Low marketing budget to promote goods and services.
- When you experience less interest from investors in funding.
In a collaborative network, you can allow companies to complement each other without compromising their share of the market or intellectual property. The success of a business collaboration does not rely on a single model or method of working. All businesses are different. Depending on your operational, cultural and financial approach, certain types of business collaboration may suit you better than others. However, some elements make collaborative networking more likely to succeed.
Advantages of strategic collaboration
- The utmost advantage of connecting with other businesses is to bring in more business. Because now you are interacting with and developing a relationship with a broader range of business partners.
- Collaboration conveys the business to focus on accomplishing the same goals but in a different manner. You will have more resources to scale up production and distribution.
- Combining two business skills can enhance intelligence, increase problem-solving power and improve decision-making. These changes can bring better results in providing excellent services to the customers.
- Businesses can learn new techniques and discover new ways of doing things. As we all know, the business has various functions, from financial exercises to marketing campaigns. When people from different backgrounds and skills meet in one place, this will uplift the work culture, create a healthy environment, and boosts creativity.
- Believe it or not, collaborating with other small businesses will help you save your money. The budget allocation of small businesses is low thus, the cost of advertisement, and promotional activities can be controlled.
Types of collaboration
The idea of collaboration creates opportunities together, and when this happens, you tend to gain different strengths and skillsets.
- Horizontal collaboration – The title itself can reveal its true meaning. Collaboration between two entities shares similar functional areas to cover and achieve.
For example Oneplus and Oppo. They have a common objective to manufacture and sell phones. They will share technology, resources, and teams. Such type of collaboration support both the business to improve competencies and aim to reach their goals.
This approach can be dangerous because your ideas, thoughts, and strategies may clash with other business leaders.
- Intersectional – When any company launches its products, it can collaborate with an advertisement, telemarketing, and social media agency to promote its products through online marketing channels. If the business mission is to promote and increase the reach of your products to the customers thus, the role of an agency is to accomplish the same goal.
- Vertical joint venture collaboration – This venture takes place legally between two parties, buyers and suppliers. It can be formed temporarily for particular projects & goals. Here, companies share resources, risks, and rewards. Maximum profit goes to suppliers. Once the task is complete, joint ventures come to an end.
The list of collaborations can be long. It can also include Technical collaboration, Marketing collaboration, amalgamation, merger, and acquisition that can save businesses to collapse in
Collaboration plays a significant role in your organization and will result in increased productivity, creativity, accountability, and positive work culture. There are numerous tasks to perform within the industry as an employer and among your employees. Collaboration encourages your team to learn and grow. Your business will be able to evaluate daily challenges in the market, and you can deliver appropriate solutions to them.