Strategic partnerships can be invaluable to a business when created with thought and intention. There are various definitions of strategic partnerships. The definition I think is most valuable to small businesses is this: a relationship with a company that sells a complementary product or service to your target market where you both refer each other. In this relationship there is intentional attention to referring the partners to clients, prospects, and associates.
There are a couple of reasons to build a pool of strategic partners. The first is that it’s better to offer options to your prospects or clients. This way they can select the right provider. The bigger the pool, the easier it will be to provide a variety of options. This keeps the decision making in the hands of your client.
The other reason is that more partners means more opportunities for you to receive referrals. If you have three companies per industry that you know well and have entered into strategic partnership relationships, you have a minimum of three companies referring you to their prospects and clients.
Developing strategic partnerships is a process and it takes time. The first step is to think about your target market, or markets. Narrow your focus to one target or two. Now ask yourself what other services and products your target needs. What are other things are they buying? Now that you know which industries, and potentially which companies are calling on your prospects, think about which ones are most likely to understand the value of your offering. This is usually an industry that is tangential to yours. Some examples are: carpenters, general contractors, or realtors.
Remembering the value of a pool of partners, select up to three industries to explore. Before you engage in outreach, determine the characteristics you are looking for. Trustworthiness, honesty, and reliability are just a few. You also want to ensure they appreciate the value of strategic partnering, and are interested in taking the time and energy to learn about you and your business. Confirm that they are indeed selling to the same targets.
A sustainable strategic partnership requires commitment from both parties. It isn’t good enough for you to learn about them. They have to understand the importance of knowing and trusting you as well. That’s not something that happens overnight. Everyone has to participate in discovery.
Now that you know what you are looking for, start in your own community. Who do you know in those industries? Simply knowing them doesn’t mean they will be good partners, but it is still the best place to start. Don’t assume they want to enter into this type of relationship or that they even understand what it means to be a strategic partner. The conversation looks like this: “We both sell to the same target. I’m thinking it might make sense for us to learn more about each other’s businesses so we can refer each other when we hear of a need. Do you think it makes sense to explore a strategic partnership?”
You also want to look for other possible partners. LinkedIn is a great place to make connections and start the process. You can also explore where you are networking. Your goal is to learn about their business and about them before even bringing up the idea. You may learn that you don’t want to pursue a partnership with them. Or you could scare them away! So, don’t rush into anything. As you do this outreach, you could say something like, “I like to learn about businesses that sell complementary products or services to my target. That way I can provide my clients with resources if the need arises. Would you be open to a conversation so I can learn more?” If they say yes, your goal is to learn.
Remember, you want to get a feel for whether they are interested in learning about your business as well. You don’t do that by telling them about your business. Rather, listen for when, or if, they ask you questions.
I mentioned earlier that this is a process. Fast-tracking can cause damage to your reputation and your relationships. Consider a situation where you jump into a strategic partnership with a company you don’t really know well. You refer them to one of your customers. Unfortunately, they don’t deliver as promised. Imagine what your customer is thinking. Can they trust your judgment? Do you really have their best interest in mind? I submit the last thing you want to do is weaken the level of trust you’ve developed with your clients. Sending them a bad resource can do just that.
At the same time, associating your business with another company that has a less than stellar reputation can create guilt by association. People will question your business practices. And lastly, if the company’s business practices are suspect, do you really want to be referred by them? I wouldn’t!
Having a strategy or structure will help you get this done. Take a moment to select an industry you will explore. Then decide how you are going to engage. Know what you are looking for in a partner and what you want to learn in that first conversation. Keep nurturing the relationships that feel mutually respectful and engaged. After you’ve both had a chance to really get to know each other’s businesses, then have a conversation about what that partnership would look like.
Ideally it will become a natural strategic partnership where you will automatically think of them as you are doing discovery with prospects, clients, and associates. They will be doing the same thing. Your relationships with your clients will be deeper, and more meaningful. Your loyalty to them through providing resources to help them problem solve will be returned.
About the author: Diane Helbig is an international business and leadership change agent, author, award-winning speaker, podcast host and web TV channel host. As president of Helbig Enterprises (helbigenterprises.com) based in Cleveland, she helps businesses and organizations operate more constructively and profitably. She can be reached via email at firstname.lastname@example.org.