Partnering - Exploring partnership opportunities
Partnering never looks the same on the outside. With different partnerships, companies find that different elements of an agreement will work for them, so even though the principle remains the same, partnership will, in a sense, remain a very fluid concept in business.
For instance, you can get a partner in the foreign country to take over your sales and marketing, or take on a partner to take on the same element of your business that you are invested in.
Regardless of the role of the partner or how they are placed within your organisation, be sure to select a partner with close attention, ensuring they are on the same page as you, as conflict later down the road can be damaging to solid business strategy.
If you do find a good partner that you can outsource operations to, you will likely find you will be able to manage your new market easier and generate revenue faster.
Microsoft and SAP joined forces to create a new cloud solution. “Through their unique partnership, the companies will co-engineer, go to market together with premier solutions and provide joint support services to ensure the best cloud experience for customers.” This type of strategic partnership is advantageous and companies that do it well together can temporarily develop strongholds that edge out competition from others and one another.
You can also identify and develop a network of channel partners that will resell your products and services. This will extend your reach beyond your current audience and expose your brand further. For this to be effective, you will need to draw up the profile of your ideal partner and connect with them to ensure you are found on channels that enhance and compliment your company and it is done in a way that you are comfortable with.
Partnership can work very well, it can be long-term or temporary, high-stake or low-risk, involve the whole business or just elements. This flexibility works if it works for all businesses. Just be careful to have terms favorable for all partners so that everyone remains happy with the agreement in place.
Forming a joint venture
You can decide to permanently partner with another company to create an independent organization. This is a share of ownership and control over property rights and operation. This is a good option for a lasting collaboration on launching a series of common products/services.
Commonly the two companies remain separate from each other but work together on the venture project.
This method offers the opportunity of financial risk sharing and the ability to combine the local in-depth knowledge with a foreign partner in technology or process.
The problem can arise with blending two different cultures and ideals, deciding on which elements of your business has to go and which must stay for the benefit of the union. It can work, the more similar the companies are, but when you are talking about companies that are locally based in different areas of the world, you will likely run into these issues.
Buying a company in the new market
Buying a company in a foreign land is one of the easiest ways to enter a new market.
Buying an existing company gives you immediate access to market share, customer base and brand image, you won’t have to build everything from scratch. It also helps with regulatory pressures.
This can be one of the most expensive ways of entering a new market. It can also prove difficult to assess the performance of another company if the metrics do not apply seamlessly across your industry or niche in another country. No one wants to find that the company they have bought will not perform as they thought it would.
Tough isn’t it!
We know that every country is different, you must adapt to the new market appropriately for your operation to be successful.
Which market entry do you think fit best your products/services and why?