No doubt you’re exploring clever ways to accelerate the growth of your start-up. You could work more hours, raise capital from outside investors to fuel growth, or open new locations – all of which are tried and true methods. However, one of the best ways to grow your business when you’re starting up lean is forming a strategic partnership. A strategic partnership or alliance with a like-minded company or industry group can provide an array of benefits for your business, such as the opportunity to access new resources, expertise or market segment. This can help boost your competitive advantage. For an alliance to be strategic and successful, it has to be mutually beneficial. Here are some considerations: Let’s be friends Strategic partnerships are effective when both companies complement each other (not adversaries). The potential partner could be in the same market as you but offers a different product or service that supplements your own offerings e.g. if you’re in the business of selling shoes, consider partnering with a fashion accessories provider (belts, jewellery, scarves and the likes). So think about where your customers go before they buy your product/service, and where they go after they make a purchase. The potential partner could also embody similar company values and modus operandi, making them complementary. Therefore, each partner can focus on its strengths, while the other can cover the areas outside your expertise. Do your homework When you have a short list of potential strategic partners, carefully study their product line before approaching them to ensure that your product is complementary. Check out the distribution reach of the company to ensure they do have the type of distribution into markets that are right for your own product. Verify the financial standing of the company and the relationship with its customers is in good shape. The last thing you want to do is to partner with a company that is going to reflect negatively on you, your product, or your business. Be realistic It’s important to know what you can and what you’re prepared to deliver, as well as your expectations from the potential partner before you start exploring opportunities. Approaching a partner without a clear understanding of your objectives can result in their loss of interest before negotiations have even begun (and vice versa). It helps to ask the potential partner what they’re looking to achieve right up front, and see if it aligns with your objectives. Remember, the value your business brings to a partnership isn’t limited to just your products or services – knowledge is power so the opportunity to share your expertise and experience with them and their clients can be just as valuable. It takes two to tango The level of commitment from each partner should be openly discussed as per any relationship. The nature of your business and theirs – including different working tempos, styles and bureaucracies – will likely determine what activities each partner will commit to, to ensure the alliance is effective. It’s best to be flexible and adaptive, again focusing on the desired outcomes. In addition, the extent to which you share resources and expertise in the partnership will need to be considered so there’s a balance between collaboration and achieving your own business objectives. One good example of a strategic partnership is Alex Perry and Collette Dinnigan each designing their own range of glasses exclusively for Specsavers. Both are leading Australian fashion designers who wear glasses themselves. The partnership allows the designers to reach a broader customer base via Specsavers, while Specsavers are able to appeal to fans of Alex Perry and Collette Dinnigan. Finally, remember that a strategic partnership is an alliance (and not a merger), so the terms of engagement should be mutually beneficial, and one that will open more doors for your business, and theirs. Angely Grecia is a consultant at MYOB.
Small business leaders around Australia are concerned the appointment of Gary Gray as the sixth small business minister under the current government creates further uncertainty about the direction of small business policy in Australia. Given Gray has also been handed responsibility of the resources, energy and tourism portfolios, SME advocates believe he will not be able to adequately dedicate his time to understanding the needs of small business. Council of Small Businesses of Australia executive director Peter Strong told SmartCompany he’s disappointed by the rate of turnover in the position. “We run on confidence, but it’s hard to be confident when we’re unsure of the future. There have been a lot of surveys done and uncertainty is the biggest problem,” he says. “I don’t know how much he understands, we’ll have to see if he understands the issues facing small business about competition law and consumer problems.” “He needs to sit down and give the industry confidence and set some policies.” Prior to his position in government, Gray worked with companies such as BHP Steelworks, Wesfarmers and as an advisor to Woodside Petroleum. Strong says when it comes to the small business minister, background is important. “If you have a background like [Opposition Small Business Spokesman] Bruce Billson does in small business, then you are more likely to understand the problems businesses face.” Without that, Strong says it comes down to the attitude Gray has and if he has the capacity to understand the fact we’re not just business we’re people,” he says. SmartCompany contacted Gray for comment but received no response prior to publication. Australian Retailers Association executive director Russel Zimmerman told SmartCompany Gray won’t have the time to develop an understanding of small businesses prior to the September election. “It would be nice to see a person allocated the role stay in it long enough to be able to get to understand small businesses.” “It’s going to be hard for him to get a grasp on the portfolio. If they are returned again, we hope they’ll bring some stability,” he says. Zimmerman says an election needs to be held because the government has recently become a “farce”. “I think there was a good reason for the government to go to the people because it’s become a farce,” he says. Zimmerman says he’s also concerned with the number of responsibilities Gray is taking on board. “Tourism and small business go hand and hand, but certainly his other role will not be necessarily associated with small business,” he says. Gray is yet to communicate with Zimmerman or Strong, but both industry representatives say they hope he will do so soon. Accounting group MYOB released a new report today which found SME dissatisfaction with the federal government remains high at 54%. MYOB chief executive Tim Reed told SmartCompany the number of recent small business ministers is “appalling”. “It’s a message which says government policies have not been well explained to small business owners,” he says. This story first appeared on SmartCompany.
Reckon is aiming to shake up the Australian accounting software market when it launches its first cloud-based product Reckon One in the next quarter.
MYOB chief Tim Reed has joined the board of digital health platform Healthshare, which has announced the successful closing of its capital raising, although the amount is undisclosed.
MYOB has outlined seven steps start-ups should take to boost their business in 2013, after revealing more than half of small businesses hope to improve systems and processes this year.
The business outlook is brighter for SMEs in 2013, according to the latest MYOB research findings, but micro businesses will continue to do it tough and have been urged to plan ahead.
Online retailers will experience their highest volume of Christmas sales from December 7-10, according to a new survey, while sales for offline retailers will peak closer to Christmas Day.
Cloud computing has been a buzz term for businesses for a little while now, but it appears that Australians SMEs just aren’t that keen on jumping on the bandwagon.
Compliance with government regulation continues to stifle business operations, according to a new report, which shows more than 80% of the businesses surveyed are struggling with red tape.
Almost one-fifth of entrepreneurs start their business as an investment strategy for the future, according to the latest MYOB research, while 18% start up because they want a seachange.
More than 40% of business owners say starting their own business made them “very proud”, new research reveals, but business milestones are outshone by personal achievements.
Almost half of Australian business operators borrowed money to stay afloat in the last 12 months, with just a quarter of them borrowing money to spend on their business, new MYOB research shows.
The carbon tax has been a contentious issue in the Australian business community since the Federal Government announced shortly after the last election that it will come into effect on July 1 this year.
Small business owners will be among the more nervous observers of today’s interest rate decision, with new research showing that more than a quarter of Australian SMEs use their mortgage to finance their business.
Start-ups are slightly more likely to have their own website than established small businesses, according to a new MYOB report, which shows 64% of Australian SMEs still don’t have their own online operation.
Small business owners have a worryingly poor knowledge of a number of regulatory changes set to start in the new financial year, such as amendments to superannuation and the tax-free threshold, according to new research.
The reputation of the Federal Labor Government among businesses continues to falter, new figures show, as Prime Minister Julia Gillard attempts to cuts her losses over the Craig Thomson and Peter Slipper controversies.
In an attempt to keep costs down, almost one-third of small business owners haven’t taken a holiday since they started their business, according to a new MYOB report.
More than 50% of Australian small businesses now have a website, according to new Google research, with one in three saying their website has resulted in more customers and sales.
Accountancy software company Xero has raised $15 million to fund global growth and has made its first acquisition for the year, snapping up Max Solutions in a deal worth almost $5 million.