Joint ventures are strategic alliances designed to boost the profits of two or more related companies by building a bigger target market base. The agreements can be as simple or complex as the JV partners want to make it, but most small business owners opt for the simplest model possible that can effectively help them achieve their goals.
This article will provide a list of the most common players involved in any joint venture to help you assemble your own cast for success.
The Endorsee
This business owner is typically the smaller company looking to ride the coattails of a larger, more established company. This player typically offers a portion of his profits, or another equally enticing bone, to attract larger companies to partner with him. Endorsees are primarily looking to boost consumer confidence quickly and effectively through endorsements and drive more traffic to his website through online marketing and assistance from his JV partner.
The Endorser
The larger company usually agrees to the partnership to gain a portion of the other company’s profits. In many cases, this bigger business also enjoys the satisfaction of knowing it is helping a smaller business make a name for itself. Perhaps the larger company likes the product offered by the smaller business or simply wants to act as a mentor. They also enjoy the benefits of free market research by discovering which of their products and services are most popular with customers from their JV partner business.
The Broker
In some cases, endorsers and endorsees might have difficulty finding one another, which is where a broker comes into play. JV brokers provide a service to potential partners by matching them with companies that could offer the greatest benefit in a JV partnership. Brokers typically provide their services in exchange for a set fee or a portion of the profits generated by the venture. Some business owners that have seen success become brokers to help other businesses achieve the same benefits.
Accountants
In some cases, the accounting required can be somewhat complex, so an accountant who specializes in such ventures offers a valuable service. This professional can counsel partners on the most efficient ways to keep the books for and offer advice on setting up accounts and reporting taxes. If you are unsure of how to set up the financial end of a joint venture, an accountant who specializes in these agreements is a must.
Lawyers
No joint venture is complete without a formal agreement that makes the partnership legal and binding. If you are uncomfortable drawing up a contract on your own, a lawyer can be helpful in drawing it up for you. This professional will ensure that everyone’s interests are equally protected throughout the partnership.
There are many players that might go into the establishment of a successful joint venture. With these professionals in your court, you can rest assured your joint venture will offer minimal risk and maximum potential for success.
Christian Fea is CEO of Synertegic, Inc. A Joint Venture Marketing firm. He exemplifies how to profit from Joint Venture relationships by creating profit centers with minimal risk and maximum profitability.
To discover more Joint Venture Marketing Strategies join his free report on Joint Venture Marketing.