Question & Answer: Growth through strategic partnerships Duration: (6:52) User: hsbcbusinesstv – Added:…..

Each business wants to grow and strategic partnership helps. Though, before entering into a partnership, it is the organizational plan and its vision for the future that should be ready for the business. It sets the long term and short term objectives and answers what the firm wants to be and where does it want to be in the due course of time. Once it is finalized, then the business can think of different type of strategic partnerships available for the growth. Here, the business has to make some considerations w.r.t. the strategic partnerships such as:
1.   Level of risk in the partnership
2.   Degree of investment required for the partnership
3.   Control of the partnership
For low risk and low investment, a business can enter into the Franchisee model of partnership where the other party brings capital and takes risk. The parent business earns revenue on the basis of sales done by the franchise. Though, there is a less control. For more control, it is better to enter into the joint venture with other firms who complement the first business firm. It will create synergy and both the firms will grow. The control will be distributed on the basis of investment and technology bring in by the firms on board for the joint venture.
Besides, a business can involve individuals with entrepreneurial passion also who can contribute to the business and can help the business grow. These people can be given as partner status as done by the CA, CS or legal services firms.
Hence, there are different ways to grow, but it is the strategic planning that helps to understand the best form of partnership for sustainable growth.