B2B partnerships, regardless of the industry or the size of the companies involved, represent high potential value. The right partner can elevate a business to the next level, while accelerating market expansion and overall capability and capacity. While the relationship can be exceedingly profitable for both partners, it may also be developed without prerequisite capital investment.
Take Office Depot, for instance, which derives 70 percent of its revenue from B2B. The company just announced that it has partnered with Alibaba, the world’s biggest e-commerce platform. Unlike most massive corporate deals, however, this one reportedly did not involve any equity investment whatsoever.
So what can a partnership deliver, when it doesn’t come with a price tag attached to it? Alibaba gains 10 million customers, while Office Depot and its many business partners walk away with access to one of largest consumer markets imaginable. The bottom line is that B2B partnerships can be immensely rewarding, which is why they are so vital and popular in today’s competitive business world.
The most dynamic and successful partnerships enhance one another’s existing resources and capabilities. One company’s strength may be its brand and customer base, and its weakness may be a lack of technological infrastructure. Meanwhile another company may have a powerful IT team, but doesn’t have brand recognition or a large market presence and distribution channel. They can team-up and solve problems for each other in an intelligent, efficient way.
Partnerships are a kind of marriage. Choose haphazardly and they can wind up in an expensive divorce. But select an ideal partner and it can be a game-changing relationship that continues to grow and scale-up and remain increasingly valuable and sustainable. Think of it as a form of cross-pollination of both ideas and practical resources.
Harvard Business Review has analyzed and categorized the most important B2B “elements of value.” While the elements were researched primarily to guide product design, they can also serve as insightful criteria when evaluating any B2B partnership. Traits from the list include stability, expertise, flexibility, and regulatory compliance – as well as time, cost, and labor reduction. Shared vision and a sense of mutual responsibility and accountability are also key. Partners who bring those kinds of benefits to the table are definitely high-value teammates worth cultivating.
Some companies use a written proposal, similar to an RFP, to clearly outline the goals of the partnership. What exactly will be shared? How does the partnership ensure that the partners are not in competition with one another? Are there effective strategies that can be outlined to guide the progress and performance of the cooperative relationship? These are the kinds of objectives and offerings that can be clarified in a transparent written document.
It’s also very important to maintain a keen focus on the customer. Identify ways that the clients and customers of each partner will benefit from the alliance. Maybe that’s through technology, lower overhead that translates into customer savings, or a more streamlined supply chain. Collaborations to enhance services and co-development of products that consumers want can be powerfully innovative, thanks to synergistic partnerships.