The Advantages of Joint Ventures

Joint Ventures have their advantages and disadvantages, but no matter how many different advantages or disadvantages you search and read about, what really matters is how you play the game. Knowing is always a key part or the game, but the play itself matters most.

First thing is partnering with a company that will compliment you well. Like getting married, you need someone who can be your better half, having similarities is great but if everything you bring to the table is exactly the same then where can you go from there?

What you want form a joint venture is to have opportunities to gain capacity and expertise. You should be able to gain as much from the other company as they can from you. That is what will make a great joint venture. You should look at how you can enter related businesses or new geographic markets or gain new technological knowledge. If you plan on entering into international joint ventures, explore access to greater resources and international specialized staff and technology. These are all possible advantages if you play your cards right.

Another advantage of a joint venture is that any risk involved is shared, so less pressure on you. Also the flexibility in a joint venture can make your life a lot easier. The life span of the agreement can be just enough to cover what you want as a joint venture is not a life time partnership. You have to remember that a partnership is like joint custody over kids. A joint venture is joining forces for one particular project and not putting two companies together forever and ever. 80% of all joint ventures actually end with one party selling out to the other.

Of course with all advantages there are disadvantages. Firstly, the steps it takes to get to a joint venture is hard. It takes time and effort to build a relationship with another company before getting to the joint venture stage. When you get there, then there’s the agreement process. Since two brains will be running one body, you need to know where your place is, who has more say in what area, expertise need to be balanced, effort should be equal etc. If the objectives of the joint venture are not clear in the beginning then it will definitely cause problems in the future.

For international joint venture, things may be a little harder as different cultures, styles and ways of managing are different. The two company heads are not the only two people who will be interacting and other people should be able to communicate with each other properly, not clashing of heads involved.

Good thing all disadvantages have solutions, and that’s the agreement process. If everything is agreed upon in the beginning and it’s on paper, then you have less chances of messing up.

Here's to your Success!

Rivers

Award Winning Global Entrepreneur, Rivers Corbett offers entrepreneurs an insight into what prevents most entrepreneurs from experiencing success. Rivers series 13 Fears of an Entrepreneur is must knowledge for any entrepreneur wanting to succeed at any level in business. Click on http://myinternetbiz.ca for more information and also receive his FREE gift of what started him on his global entrepreneurial journey.