Partnerships - How to use them for your Business

What are the 4 Types of Business Partnerships ?

A business partnership is a legal relationship that is most often formed by a written agreement between two or more individuals or companies. The partners invest their money in the business, and each partner benefits from any profits and sustains part of any losses. There are four types of partnerships.

1. General Partnership

2. Limited Partnership (LPs)

3. Limited Liability Partnership (LLP)

4. Limited Liability Limited Partnership (LLLP)

The Importance of Strategic Partnerships in Business

The partnership is crucial to the growth of any business venture. Merchants and traders from time immemorial have made use of the principle of a strategic partnership to conduct their businesses; the trend is still very much applicable today. A partnership manifests itself in different forms, ranging from business owners cooperating to invest in a project to share technical knowledge and ideas between firms. Whatever any business does, it is important to look for the right partnership agreement that benefits both parties.

The 8 Best Ways to Maintain a Business Partnership

Partnering with another company is one of the most effective ways to expand your customer base. Besides free advertising into several new demographics, strategic partnerships also allow you to provide more value to your existing customers. Here are the best ways to make sure you set your partnership up for success:

 Set clear expectations

You should have a strong connection with the business you partner with, but hammering out the details of that partnership has to be more technical than emotional. Define the business structure (partnership or corporation), what the partnership should accomplish for each company, and what constitutes each partner's domain. This will eliminate confusion for both companies' leaders, employees, and customers. It will also help you avoid complications and disagreements over which partner should handle what. When you started your company, growth may have meant each employee taking on whatever roles were needed for the company to succeed. For your partnership to succeed, however, you must give every employee and manager a specific title with clearly defined responsibilities.

 Consider your partner a part of your team

Clear and well-defined roles ensure there will be no overlap in offerings that could generate competition between you and your partner. Such conflicts are a significant reason why up to 80 percent of business partnerships eventually fail. It may temporarily delay the partnership, but you'll both flourish if you take time to thoroughly integrate each other into your teams. Your partnership, however, shouldn't be just about benefiting from the other company's technology or customer base. To make the partnership as valuable as it can be, it should be about learning, growing, and benefiting from each other's knowledge and experience, too.

 Give the partnership room to grow

Remember, you're not just pooling resources; you're also combining your abilities to scale as quickly as possible. From a business perspective, extensibility is a vital element in any partnership because both your partner's and your ability to extend resources can mean freedom for employees to innovate new products, customer engagement strategies, and more.

A valuable partnership should be capable of sharing resources and adapting over time.

 Make honesty and transparency your watchwords

Long-term success also requires honesty and transparency from both partners. That means maintaining open and frequent communication as well as personal interaction as often as possible. Make your strengths and shortcomings known upfront and insist on the same level of honesty from your partner. Both companies have to be transparent about what they lack and what they offer before deciding whether the partnership is a good idea. You also have to remain transparent for both sides to capitalize on every opportunity and learn from every failure. Honesty is the best policy when building any relationship. You'll get more out of your business partnership if you make it a priority.  Build a real relationship

The best and often most successful partnerships are built on the foundation of a friendship or working rapport together. If you like your partner as a person as well as a business owner, doing business with him/her will come much more naturally. In the beginning stages of forming a partnership, try and get to know and connect with your new partner on a

deeper level than just focus on business only. Your business relationship will thank you in the long run.

 Establish a plan early on

Once you become interested in a business as a potential partner, don’t wait to get things moving. Reach out to them right away! The sooner you contact them and make that initial invitation to connect, the sooner the two of you can lay down a plan of what your partnership will include. Make sure to keep both sides even and that you are both receiving equal amounts of benefit from this relationship together.

 Cross blogging

Cross blogging is a great way to build a partnership. Set up an arrangement with your new partner that entails you writing a guest blog post for their blog and them writing a guest blog post for your blog on an agreed-upon reoccurring time. Most cross bloggers agree upon swapping posts once a month, but some can do it as much as once a week, or as little as once every three months.

 Communicate regularly

If you haven’t caught on by now, the key to maintaining a good partnership is to treat it like you do the relationships you have in your life. And just like any other relationship, a consistent and healthy method of communicating together is the ticket for success. Even when you don’t have any specific partnership business to discuss, send over an email from time to time to check in with your partner’s business and see how things are going. Showing that you care about their business shows that you care about the partnership and are willing to be there and go the extra mile to support them in any way you can.  Identify potential challenges & solutions

It may be obvious, but when you work with people, you must understand that conflict is a natural part of partnering with diverse groups. The key is being able to anticipate and use conflict constructively. As much as we all like to avoid conflict, we have to work on minimizing some of the negative aspects so our professional relationships aren’t affected. In order to do this, we must communicate effectively and keep lines of communication constantly open. This helps to establish trust, keep partners informed, and provides opportunities to address questions as they arise. Also, establishing a decision-making process that is fair and open will help to alleviate interpersonal issues.

 Evaluate partnerships

Evaluation plays a key role in developing and sustaining community partnerships. However, even the strongest partners seem to neglect to evaluate their partnerships. Partnership evaluation helps to determine whether goals or objectives have been met. This involves identifying partnership strengths and areas for improvement in operating processes, structure, planning, and activity implementation. Having an evaluation plan in place will help to determine if successful strategies can be supported and replicated.