Being approached to participate in a business to business partnership is an exciting opportunity for most small business owners, especially if the company reaching out is large or well established in their industry. This type of unsolicited partnership deal is enticing and has potential to give small businesses immediate market traction. However, it’s good idea to take the same steps you would in validating and researching a prospective partner if you were the one initiating first contact. This can be difficult due to the desire to grow your business and not miss out on a seemingly profitable deal. Keep the following tips in mind when being approached for a business to business partnership.
Take your time.
Remember they approached you. Just because a business development person is requesting a meeting to discuss a partnership deal does not mean you have to clear your existing schedule or the deal will immediately disappear. If the company is sincere in its desire to develop a mutually beneficial partnership, than you can delay a face to face meeting for a few days or even a week to research the company in greater detail. There are many ways to bump a meeting or a phone call out a week without seeming like you are intentionally delaying. So come up with a valid excuse that fits your schedule and daily business routine.
Identify the benefits.
It is very important to understand the areas where your business will benefit from a potential partnership. These types of business deals are likely to reward your company more so than other types of deals you would pursue on your own. This can range from access to existing customer lists to funding for marketing campaigns. A large fortune 500 type company that is pursuing a business partnership with your smaller firm has likely identified a very specific competitive advantage that they see from having a strategic relationship with your company. They will be willing to help your business be successful however; you must negotiate these benefits prior to signing the deal while your company still has leverage and the ability to partner with a competitor.
Negotiate.
After identifying what you feel will benefit your company the most from a business to business partnership with the inquiring company, make sure to negotiate the deal in your favor the best you can. While the partnership should always support both companies’ goals, if you’re on the receiving end of being offered the deal it is wise to negotiate for better terms regarding revenue shares and other resources. Many small business owners make the mistake of jumping in too quickly and fail to negotiate favorable terms with a large company that locks them up from working with competitors thus restricting future opportunities for growth. Make sure that if you’re going down the path of an exclusive relationship that you’ve run the numbers and are satisfied with the income potential of the deal.
Enjoy being on the receiving end of a business to business partnership request and take your time to fully think through the opportunity and whether it is the right fit for your company’s strategic growth plan. There is no reason to rush into a deal that you have not fully vetted or feel comfortable with. Make sure to negotiate the terms of the deal that best help fulfill your company’s current and future growth needs.
