Business Relationships with One Another

Key Ideas: Strategic Partnerships, Strategic Alliances, B2B Partnerships

ReSearch

Governmental Institutions and Establishments

• US
  • Minority Business Development Agency (MBDA) - http://www.mbda.gov/

Businesses

• Taylored Solutions: facilitating successful relationships - http://www.tayloredsolutions.co.nz/

Articles

• Small Business/ Large Business Relationships - http://www.inc.com/encyclopedia/small-business-large-business-relationships.html
• The Art of Business Relationships through Social Media - http://iveybusinessjournal.com/publication/the-art-of-business-relationships-through-social-media/

Concepts on Business Relationships

General Concepts on Business Relationships

Concepts on Strategic Alliances

What are the different Types of Strategic Alliances?

• Simple Contract
  • Basic transaction when a business offer is accepted and something of value is exchanged. The contract is specific about what is expected by each party and does not obligate the businesses to any future deals.
• Open-ended Contract
  • Specific about the terms on which the companies will do business, but perhaps not specific about how much business will be done or when.
• Joint Contract
  • A company can contract with two or more entities to supply goods or services. Typically, two suppliers work very closely together and the contract's primary purpose is to communicate what the client expects of them.
• Mentor-Protégé Relationship
  • Business mentors provide information and advice to other companies in their early years. The best relationships provide meaningful guidance and result in a successful business relationship.
• Supplier Development Relationship
  • Competition is between rival value chains struggling for a share of rapidly-evolving global markets. Competitive advantage, therefore, rises from various points in the value chain and makes it important for minority-owned firms to develop into strong value chain partners.
• Strategic Partnership
  • Two or more suppliers coordinate their strategies so they either become dependent on each other or else have a binding agreement to seek business together.
• Joint Venture
  • Legal independent business entity that is owned by the strategic allies. It operates entrepreneurially, drawing on resources as needed from the parent organization. It is distinct from a strategic partnership in that a new organization is created to achieve competitive advantage that neither parent organization could accomplish alone.
• Acquisition/ Merger
  • One company legally acquires the other. “merger” when two former entities are equals.

References

• Strategic Business Partnership - http://www.mbda.gov/blogger/mergers-and-acquisitions/strategic-business-partnership

Concepts on Strategic Partnerships

What are the different Types of Strategic Partnerships?

• Strategic Partnership
• Strategic Marketing
• Strategic Supply-Chain Partnership
• Strategic Integration
• Strategic Technology
• Strategic Financial Partnerships

How to Form Strategic Partnerships?

• Proposal/ Strategic Partnership Agreement
  • The parties involved in the agreement
  • The services to be performed by each partner
  • The terms of the agreement (percentages of profit, method of billing, etc.)
  • The reporting structure, person of contact, etc.
  • The duration of the agreement
  • The signatures of company officers or their designees

References

• 5 Types of Strategic Partnership Agreements to Help Grow Your Business - http://blog.pandadoc.com/strategic-partnership-agreement

Partnerships with Larger Companies

What are the various tips when negotiating and maintaining a partnership with a larger company

• Compatability
• Competition
• Research
• Fundamentally sound Business Practices
• Recognition of own responsibilities
• Monitor Requirements of successful partnership
• Not be intimidated
• Maintain Independence
• Establish clear and open lines of communication