I’m not going to sugar coat things. While there are plenty of advantages to forming a joint venture, there are also a number of disadvantages. I believe that the pros outweight the cons, but you should also be aware of the disadvantages so that you can watch out for any red flags as you work to build your business.

So when might a joint venture go sour?

A joint venture won’t work if both parties aren’t willing to work together to build a solid working relationship. It takes time to get to know a business partner and you shouldn’t be willing to give up after only a short period of time. There are a few signs that your joint venture is going to end up going down the tubes, though.

• You aren’t able to identify clear objectives. Both partners should be on the same page concerning the vision and goals of the joint venture. A lack of communication in this area is a terrible thing, and will ultimately result in both of you focusing on different projects instead of one common goal.

• Make sure your joint venture is evenly balanced. What I mean is that you need to make sure you have experts in every area. The workload can’t be evenly distributed if one person has too much expertise and others have very little. Besides, if something happens to the “expert” and no one else knows what is going on your project will come to a grinding halt.

• Before embarking on a joint venture determine if you and your potential partner have similar management styles. If you don’t, you’ll have a difficult time integrating the different parts of the project when they’re completed.

• In many cases, one partner ends up depending on the other to provide leadership to the teams. This may lead to burnout if you’re the one stuck with all the work.

Of course, these are disadvantages only if you jump into the joint venture without doing your research first. I firmly believe every single problem listed above can be avoided by making a clear plan before you sign a binding agreement. A properly formed joint venture can be very rewarding, so make sure you’re taking the time to double check your work!

Sean

Sean McPheat

Marketing Consultant - Internet Marketing Consultant - Sales Expert

The Advantages of a Joint Venture

By this point you may be thinking that a joint venture sounds great, but you are probably questioning whether or not there is really any distinct advantage to participating in one. I asked the same questions of myself when I first started out and I quickly realised that joint ventures have more to offer than convenience.

Joint ventures are financially beneficial to both parties because neither has to put up 100% of the upfront costs alone. You’ll discuss the percentage of cost each will pay in the beginning, and the profits will be split at an agreed upon rate as well. Forming any sort of new business can be expensive and joint ventures are one way of alleviating the burden of start-up costs.

Starting a joint venture will give you access to a broader client base. You may already have a list of clients interested in your product, and chances are your joint venture partner has a list of clients as well. Put those lists together and you’re list has doubled, like magic. “What if I don’t already have a list?” you ask? Perhaps a client list is part of what your joint venture partner is bringing to the table. In that case, you get to benefit from an established list without the work of forming one yourself.

Joint ventures increase your ability to access or share valuable resources. Let’s say, for example, you have written an incredible e-book on credit repair but you have no advertising or marketing skills. You might find a joint venture partner who is experience in marketing but is still looking for the perfect product. You would each give the other access to a skill or product from which you could both benefit in the end.

Joint ventures are flexible. Joint ventures aren’t usually permanent business arrangements, giving you the opportunity to move on to another project after a given period of time.

You can eventually sell your end of the business. Many joint ventures end with one partner selling to the other. You may have recouped your costs and made a decent profit and perhaps feel that now it will be more beneficial to move on to another niche. Whatever your reason, it is not uncommon or difficult to sever a joint venture relationship after you have both fulfilled your obligations.

I truly believe that the advantages of a joint venture far outweigh the disadvantages. You stand to profit more from a joint venture than from attempting a project on your own, especially if you don’t have all of the technical skills that are necessary to get started.

Happy Hunting!

Sean

Sean McPheat

Marketing Consultant - Internet Marketing Consultant - Sales Expert

What is a Joint Venture?

Joint ventures are more common than ever before. When I first broke into the field of marketing I thought I could do everything on my own, but I soon realized that having a partner, at least on certain projects, could be far more beneficial than working alone.

A joint venture is a partnership. Two or more individuals with different skill sets come together to collaborate on one project. Their unique blend of talents makes it easier to get the job done while at the same time minimizing the financial risk incurred by each of the involved parties.

More often than not you will hear of large corporations coming together to work on a project, but joint ventures are becoming more and more common amongst small business owners and independent contractors as well. Internet marketers, salespersons, non-profit groups and many others can gain great benefits from joint ventures.

Joint Ventures are great for a number of reasons. First, if you’re new to the business world it may be hard to gain the exposure you wish you had even though you have an incredible product or service to offer. Finding a partner with excellent marketing skills will allow you to advertise your product while your partner will benefit financially from the sales, depending on how your agreement is set up.

Never jump into a joint venture without doing plenty of research first. Consider the partner you’re getting ready to do business with, and determine whether or not you have a similar set of morals when it comes to business and ethics. It would be detrimental to your career to start a project only to have to cancel it mid-way through because of irreparable conflicts of interest.

Assess your communication skills against those of your potential joint venture partner as well. Your project will surely fail if one of you isn’t able to communicate effectively with the other as valuable information is likely to be lost during the process.

One of my favorite aspects of a joint venture is the fact that it gives me the flexibility of working with someone new without the burden of a full-time employment relationship. We can each focus on our strongest skills while working towards the same ultimate goal. If only every team I ever formed was as simple to deal with!

With the right business partner, anything is possible. Have you ever participated in a joint venture? If so, leave a comment and tell us about your experiences!

Happy Hunting!

Sean

Sean McPheat

Marketing Consultant - Internet Marketing Consultant - Sales Expert

How to Ask for a Joint Venture

It’s time for you to get out there and find a partner for your first joint venture. I assume you have a product you want to sell, but you can’t simply begin approaching people and asking them to market your product. So what will you do about finding a partner and formalising the venture?

Start by doing some research upfront. Understand the strengths and weaknesses of each person you are considering for your joint venture, and determine exactly why you want each one to participate. Have they participated in joint ventures in the past; were they successful? Simply stating that he or she is a great salesperson is not good enough, for them or for you. What skills will this person bring to the table?

Take a look at the people you already know. It’s much easier to form a joint venture partnership with someone who is already a friend or acquaintance than with a total stranger. If you have a partner in mind but don’t know him already, try to determine if you are friends with someone else who is. Can that person provide a recommendation on your behalf?

Put together a detailed plan. Don’t approach someone out of the blue with a half-brained idea and expect him to jump up and down with excitement. It isn’t going to happen. Write out a detailed plan describing exactly what you want to sell, how you want to sell it, what you hope each participant can bring to the table, and how the profits will be split.

Communication is essential to a successful joint venture. Once you’ve opened the lines of communication, keep them open. Honestly answer any question your potential partner asks and do not get discouraged if your first choice decides your project isn’t right for him. Don’t badmouth him to others, either – a business decision is a business decision. Besides, one of you may think of the other for a more suitable joint venture at another point in time.

Finalise the details of the actual project. Your initial plan may not have had a firm marketing strategy or pricing structure. These things will need to be finalised along with details regarding which partner will collect payments, how the other will be paid, how sales will be tracked, or who will be responsible for paying which costs.

Sign on the dotted line. Once you’ve finalised all of the details, make sure you formalise a contract for each of you to sign. It’s best to seek legal guidance when it comes to drawing up a contract, but you shouldn’t take offense to signing one at all. A contract is simply meant to protect both you and your business interests.

Finding a person to approach about a joint venture may be a difficult task, but getting up the nerve to actually ask that person for a joint venture is even worse. Remain professional and confident at all times and you’ll be amazed at what you can achieve. Maybe you’ll even find a long-term business partner in the process.

Happy Hunting!

Sean

Sean McPheat

Marketing Consultant - Internet Marketing Consultant - Sales Expert