Partnering with businesses

mscott2097

when two businesses partner with each other, what exactly does that mean  ? I know its a stupid question but im looking to increase revenue and there is another business that i know that  we can mutually help one another but im not sure if im supposed to expect compensation or if they want compensation. etc..

drvag

I assume this is not a competitor, because there are anti-trust laws that frown on that.  So I also assume it`s a business that compliments yours and vice-versa.  I have never heard of one paying the other, but I guess you could in some compensation.
One company that I had was a manufacturer of accessories for vinyl siding for your house.  So, I aligned myself with one of the larger siding manufacturers out there.   As we got to know each other, we traded new leads, shared many of the sales reps, sometimes we shared tradeshow booths, (because of the common reps), etc.  We refered them and they refered us.  They ultimately struck a deal with Georgia Pacific, whose primary account back then was Lowes.  As their vinyl siding sales grew exponetially, ours did too.  Right place at the right time.
The type partnership you are asking, I also assume is still two totally seperate tax entities.  Not a partnership that files a single tax return.
You could also do other things, I guess.  Maybe share employees.  One manager could run both places if close.  Of fill in with help when shorthanded.
Offer discount programs for each other products.
Just a few.
 
 

mscott2097

so its more like sharing resources that generate revenue for both companies. right?

SteffanPerry

Partnering with business`s is one of the best ways to basically get free advertising.For example we are in the process of partnering with a company that provides a internet shopping cart. Why? because we provide a product (internet merchant account) which basically requires a internet shopping cart. Vise versa, an internet shopping cart requires a internet merchant account in order to accept credit card payments from your customers. For most people, they buy internet shopping carts the same time as they do merchant accounts. this is going to cost both of our companies absolutely nothing however for every potential client they advertise their products to, they are also advertising us along with them and vise versa.

patentandtrademark

Partnering with another business is a great way to increase liability.  Partners are liable for the mistakes of each other - kind of like a husband/wife.  One way around this is to be a limited partner.