In a collaborative arrangement, two companies collaborate in a certain area, such as advertising, inventory, combination, innovation, accountancy, or a mix of these.
Examples of collaborative efforts could include a digital marketing company and a graphic designer, a web designer and a data administration business, or an Internet Service Supplier (ISP) and an e-mail service.
It could be worthwhile for both a startup and an established company to enter into a strategic alliance agreement.
The minimum that could be expected from a strategic alliance is enhancing the worth of your product or service by enlarging what is accessible.
A relationship between two groups can be perfect if they possess complementary traits.
We’re going to take a look at five common types of strategic partnerships, as well as what goes into a typical strategic partnership agreement, but first:
Why a strategic partnership?
Let’s look at the advantages of entering into a strategic alliance.
A cooperative relationship that is advantageous to both parties is established between two distinct organizations that do not vie for the same customers.
Businesses have been forming strategic alliances for a long time to improve their offerings and reduce expenses.
It is believed that having two is preferable to having one, and by joining forces, the businesses involved can reap benefits beyond what they would have had independently while the partnership is in effect.
What are the different types of strategic alliances?
Legal strategic alliances are partnerships between businesses that involve forming a legal agreement so as to reap a multitude of advantages, such as expanded resources, increased personnel, and greater brand renown.
There are three main types of strategic alliances:
1. Joint venture
A joint venture is formed when two or more businesses come together to create a new, distinct entity. Partners have the option to go with either a 50/50 joint venture, where both of the original organizations have the same size stake in the new company or a venture where the majority of the ownership is held by one of the parent companies.
In a majority-owned enterprise, one venture partner can possess 80 percent of the subsidiary corporation, with the other partner taking up the other 20 percent, for instance.
2. Equity alliance
An equity alliance will take place when one firm buys a certain fraction of the ownership of another company.
3. Non-equity alliance
Two companies mutually come to an agreement where certain resources, such as intellectual property, assets, or any other necessary items are shared among them under the terms of a contractual arrangement.
A lot of the prior strategic alliances are also thought of as non-equity collaborations.
What’s in a strategic partnership agreement?
Once you have assembled a plan for partnering up and have chosen a suitable ally to collaborate with, you should generate and ratify a suggestion or contract for partnership.
The complexity of this document can vary widely depending on the range of the partnership, the clauses stated in the contract, and the size of the organizations taking part.
In all cases, a basic strategic partnership agreement should include the following:
- The parties involved in the agreement;
- The services to be performed by each partner;
- The terms of the agreement (percentages of profit, method of billing, etc.);
- The reporting structure, a person of contact, etc.;
- The duration of the agreement, including the effective date and any details of severability or end date;
- The signatures of company officers or their designees.
In a strategic partnership agreement, complexities may arise, but you will always find some form of these components.
Thankfully, PandaDoc’s partnership agreement forms are structured in such a way that you will always have everything you need.
They’re pre-built with all standard sections covered.
It is a breeze to simplify the contract process with PandaDoc, from beginning to end.
You want to make sure that all tasks are clearly written down so that no one has any doubts about who is responsible for what.
Firms often decide to incorporate quality control and auditing stipulations into their alliance contracts to uphold the excellence of the outputs or services produced by the relationship. This could be worth taking into account while forming your own accord.
What makes a good strategic partnership?
In the perfect world, you would only be in the most advantageous alliances, but what does that look like?
The following factors play a crucial role in marking out strong strategic relationships:
1. Enhanced strengths
Those you collaborate with should bring out the best in you and be sure to give you the opportunity to take full advantage of your abilities. Put another way, it is important to identify collaborations that will enable everyone to operate optimally. If you and your partner are preventing each other from progressing, it’s not a beneficial relationship.
In contrast, if you are supporting and boosting each other’s advancement, it is perfect.
2. Mutual values
We tend to have a better relationship with those who have similar values to our own. The same applies here. It is significantly more straightforward to collaborate with others who regard the same ideals as you and ascribe to the same company principles. Let’s look at an example.
It could be that your business puts a great deal of importance on looking after the welfare of its workers. Teaming up with a company that also values well-being will enable you to go directly to exchanging tips for enhancing it, without first having to go into the reasons why it is important. They already agree! It’s not just day-to-day values, either.
If a business values moral consideration and has firm beliefs when it comes to climate change, human rights, and nuclear arms control, any collaboration with a company that has divergent perspectives would generate damaging publicity.
Operating independently has its advantages, but it is usually much better to function as a unified whole. Obviously, that doesn’t mean all the people employed in your organization should start to toil for your ally at once. Instead of having two sides work independently, it is better to form a joint team so that everyone is part of one collective whole.
This enables you to increase efficiency, improve collaboration, and guarantee that the completed assignment is something everyone can be satisfied with.
How Can Partnership Marketing Grow Your Fitness Studio?
Collaborating with other companies to mutually advertise one another’s products and services has many advantages. Co-marketing lets you pool talent, time, and finances. This renders the task of gathering a group of individuals who hold an affinity for your brand significantly easier. Here are the main benefits:
It Saves Time & Money
Partnerships between fitness studio owners can be extremely advantageous in terms of marketing because it doesn’t leave all of the work on one person’s shoulders. By teaming up, both parties can work together to not only make the workload but cut down on costs as well, resulting in faster growth for everyone.
In contrast to other marketing strategies such as print advertisements or radio ads, partnership marketing carries a comparatively low level of risk. You are not investing large amounts of money for a single advertisement with no assurance of a benefit. But instead of just taking, you’re creating a relationship that will add value to your fitness business, as well as your partners’ ventures.
Broadens Your Reach
There are numerous potential customers who would be interested in signing up with your studio, but they are unaware of it. Partnering with another company helps increase the visibility of a brand by introducing it to the existing customer base of the partner. You may discover that you receive a great deal of sudden recognition suddenly.
Given that the majority of business owners cite bringing in more traffic and leads as their number one marketing issue, joining forces with another company through partnership marketing is a simple and dependable way to expand your reach and continually draw in new prospects.
Leverages Your Partner’s Reputation
You can give your studio more positive visibility by forming beneficial alliances with respected and reliable companies. In the same way, your partner will gain from utilizing your credibility as well. Both of you are going to be able to connect with new clients who have expressed curiosity about your product or service and have already demonstrated their loyalty.
5 Steps to Building Partnerships
Forming partnerships can lead to a profitable business, though they can be difficult to initiate. To help prevent some of the most typical mistakes, this is a basic, step-by-step guide to get you off and running.
1. Locate a Suitable Partner
One of the main obstacles to forming a successful connection is discovering an individual who holds similar views in your field. It would be a waste of time to collaborate with an organization whose clients don’t need your offerings. Getting involved in a collaboration with a business provides little to no publicity.
So, when forming a list of suitable partners, keep your eyes peeled for the following characteristics:
- Similar brand values
- They have a similarly sized business (or better if theirs is slightly bigger)
- They have a large and engaged customer base
- Not a direct competitor
Possible good matches for gyms and fitness centers could be corporations like supplement sellers, equipment makers, physical exercise podcasters, physical exercise YouTube channels, Instagram individuals with high numbers of followers, and local organizations like cafes, health food stores, and physical therapists.
Connecting with potential associates tends to rely on traditional methods of communication. You can often get a relationship underway much more easily by using those people you’ve already been in contact with whom you have a good relationship.
2. Reach out to Your Potential Partners
There are various methods of reaching out to someone; while email may be the conventional choice, it isn’t inappropriate to contact someone on LinkedIn or send them a direct message on Instagram if that is where they spend a lot of time online.
Take a moment before you press the “send” button to think of offers to present to the recipient, clearly pointing out the advantages for them. The way to build an alliance is by providing your partner with an appealing offer.
3. Develop Your Proposal
Arrange an appointment either face-to-face or by means of a video call and discuss the details of your emerging agreement. Discuss the advantages that both parties will have from the relationship – since if only one person realizes a benefit then the association won’t endure.
Nail down exactly how you’re going to work together – if you’re stuck, here are some simple examples to get your creative juices flowing:
- Mention each other in your emails or social media channels
- Share complementary skills (e.g. a 12-week yoga and vegetarian cookery course)
- Guest post/interview on each other’s blog/podcast/youtube channel
- Host monthly workout & coffee mornings at your local cafe
- Offer membership discounts: Physical therapy, nutritional consulting, supplements, etc
- Develop co-branded physical products like water bottles or apparel
Come to an agreement on who will be responsible for what from the beginning of any kind of partnership. Establish objectives to evaluate improvement, modify strategies as needed, and determine the financial reward of your efforts.
4. Trial the Relationship
It is desired that your new alliance will provide great success for both parties in the foreseeable future. However, life isn’t always perfect. Therefore, it is perfectly alright to give a relationship a try for a while, whether it’s a few weeks or months, and end it if it doesn’t pan out.
It is possible that your clients are not captivated by your new proposition. In certain occasions, you may need to start over and sort out some particulars, and in others, it might be wise to dedicate your energy elsewhere.
You can never tell what response your members will have, therefore there is no reason to be embarrassed about devising another course of action if your affiliation isn’t advantageous.
Take heed to ensure you are devoted to the collaboration and fulfilling your share of the workload as well – everyone needs to give them all so that everyone can gain.
5. Continue to Look for New Marketing Partnerships
There’s an endless stream of partnerships out there. A lot of these can help escalate your company to higher levels. It is critical to be ready to take advantage of fresh possibilities when they present themselves.
The top-performing companies strive to pair up with other noteworthy organizations in order to gain mutual advantages. They comprehend that creating beneficial alliances is a talent that might require numerous trials to accomplish. It’s likened to a numbers game – the more attempts you make to construct advantageous relationships, the higher your chances of accomplishment. With some dedication and a suitable strategy, you can create a set of close-knit associates who will be able to foster each other’s progress in the long run.
Partnering with other brands is a great method for increasing the number of people who are aware of your studio, due to the impact of the other business’s followers and their esteem.
Partnering with another organization can be a smart and inexpensive way to advertise your studio. This could range from merely raising awareness of each other to actually collaborating and creating something together.
By investing the effort to choose a partner who shares the same outlook and teaming up to come up with a concrete plan, you will be able to expand your customer base, promote membership sales, and strengthen the benefit of your studio.